Every delivery from the producer to the distribution center of the large-scale organized retail (GDO) carries with it a flow of information: what has been ordered, what travels on each pallet, which batches and which expiration dates. When this data does not match, or must be copied by hand, delays, checks, corrections and rejections arise. The GS1 standards offer producers, distributors and logistics operators a common language to identify goods and locations and to exchange data without ambiguity.
The research The hidden costs of the consumer goods supply chain presented by GS1 Italy analyzes the burdens of informational collaboration deficiencies between industry and distribution and points to shared standards as a lever to reduce it (GS1 Italy, 2026a; 2026b).
The ECR Italy research on relationship costs
The study was promoted by ECR Italy (Efficient Consumer Response, the GS1 Italy business community dedicated to supply chain collaboration) and conducted by Fabrizio Dallari, LIUC Università Cattaneo, and Marco Melacini, Politecnico di Milano. It analyzed 48 business case real, half in fresh and half in dry. Eight producers and eight large-scale retail chains each indicated three counterparts: the best, an intermediate, and the worst. The examination concerned the management of about 17 million packages, delivered or received (GS1 Italy, 2026b, pp. 22-28).
I costs have been reconstructed in euros per package from both sides of the relationship:
- The Cost-to-Serve includes order management, preparation, and transportation borne by the producer;
- The Cost-to-Receive includes order issuance and goods receipt borne by the large-scale retail chain (GDO) (GS1 Italy, 2026b, pp. 20 and 30).
The fresh segment includes cured meats, dairy products, and gastronomy. Here, the receiving cost borne by the GDO increases on average by 38% when moving from the best to the worst relationship. Producers’ service cost increases by 77% (GS1 Italy, 2026b, pp. 53 and 57). In the dry segment, the GDO receiving cost varies on average by 122%, with values ranging between 119% and 127% across all four distribution centers examined (GS1 Italy, 2026b, p. 64).
Overall, the extra costs of lack of collaboration amount on average to almost 15% of logistic costs in the fresh segment and approach 20% in the dry segment. In some cases, they exceed double the average values of the sample (GS1 Italy, 2026b, p. 12).
The two measures quantify different phenomena. The 122% expresses the distance between the best and worst relationship; the 20% is the average share of extra costs on the sector’s logistic costs. Neither relates to the consumer price. The authors present the results, based on a limited sample, as an interpretive key to variability factors and as a basis for identifying improvement levers (GS1 Italy, 2026b, pp. 52 and 63).
Where extra costs arise
On the producers’ side, the main factors are:
- deliveries rejected due to reorder errors;
- penalties for transporter waiting times at distribution centers;
- discarded pallets upon entry and re-palletizations charged back;
- revisions of already issued orders and failure to meet agreed cutoff times.
On the GDO side, delays emerge instead with respect to dates and time slots, non-conformities on quantities and remaining commercial life, manual data entry, and administrative activities to reconcile ordered and delivered (GS1 Italy, 2026b, pp. 12-13).
A significant part of these inefficiencies concerns precisely identification and data. In fresh products, relabeling packages without EAN codes or with incomplete information, together with verification weighings and repalletizations, can account for up to 10% of GDO receiving costs (GS1 Italy, 2026b, p. 55). The research also reports transport documents without standardized article codes, which prolong data entry and reconciliation times (p. 33).
The low percentage of orders transmitted via EDI (Electronic Data Interchange), that is the electronic exchange of commercial documents in a structured format directly between company information systems, is among the critical issues in the supply chain (p. 15). Among virtuous relationships, on the contrary, the authors cite the complete digitalization of information exchange with GS1 logistic labels and EDI data (p. 16).
GS1 standards, beyond the barcode
GS1 is the organization non profit that develops the most widely used standards in the world for product identification. It brings together 120 national organizations and over 2 million companies, of which 42 thousand are in Italy. Its goal is to facilitate automated and reliable data sharing between companies (GS1 Italy, 2026b, p. 5). The system goes far beyond the barcode that made the acronym famous, as it includes identifiers, reading supports, and exchange standards that operate in synergy.
| Component | Function | Application |
| GTIN (Global Trade Item Number) | Identifies the commercial item | Orders, catalogs, cases |
| GLN (Global Location Number) | Identifies parts and places | Plants, warehouses, recipients |
| Serial Shipping Container CodeSerial Shipping Container Code) | Identifies the logistic unit | Pallets and shipments |
| Application Identifier | Defines the meaning of the data | Batch, expiry, quantity |
| GS1 EDI (Electronic Data Interchange) | Standardizes commercial messages | Order, shipping notice, receipt |
| GDSN (Global Data Synchronisation Network) | Synchronizes product master data | Logistic data and updated datasheets |
| EPCIS (Electronic Product Code Information Services) | Shares supply chain events | Shipments, receipts, transformations |
| GS1 Digital Link | Links identifiers to the web | Information for operators and consumers |
Sources: GS1 (2026; 2022); GS1 Italy (n.d.-a; n.d.-b); GS1 Italy Services (n.d.).
The GTIN identifies the item; EAN-13 is one of the barcodes that represent it. Batch and expiry are added through Application Identifier (GS1, 2026). The company prefix assigned by GS1 does not indicate the country of production, considering that a company can produce in several countries (GS1, n.d.).
SSCC and shipping notice: the pallet speaks to the warehouse
The application closest to the issues studied in the research is the combination of SSCC, which uniquely identifies each pallet, e DESADV (Despatch Advice), the electronic shipping notice. The notice communicates the delivery content in advance. Upon receipt, reading the logistic label links the physical pallet to the data already present in the recipient's system. According to the bluebook, standards such as EDI and DESADV can enable the ‘full digitalization of the order-delivery cycle‘, with a significant reduction in disputes (GS1 Italy, 2026b, p. 33). The study also dedicates a specific study to the benefit of digitalisation on reception times (p. 67).
An example process: a canned food producer assembles pallets, assigns each an SSCC, and sends the notice before departure. The distribution center reads the label, finds the declared information, and compares it with the order. Only differences are recorded as exceptions. The benefit depends on the timeliness of the notice and its correspondence with the actual goods.
Master data aligned with EDI and GDSN
With theEDI, orders, shipping notices and invoices pass from one information system to another without being copied from emails or paper documents. GS1 EDI is based on the EANCOM standard. In Italy, GS1 Italy also provides Euritmo, a web-EDI solution accessible to smaller businesses (GS1 Italy, n.d.-a).
The electronic message only works if the parties share the same master data. The research cites the case of the ‘packaging sizes‘: a supplier modifies the size or content of the package without notice, and distribution must adjust sales and shipments (GS1 Italy, 2026b, p. 33). The GDSN solves this problem at the root: it synchronizes product information between business partners through a network of data pools certified. In Italy the GDSN-based service is Align by GS1 Italy Servizi, which guarantees real-time information exchange between parties (GS1 Italy Servizi, n.d.).
Traceability: products, batches and related events
The General Food Law requires operators to identify direct suppliers and customers and to make this information available to authorities (Reg. EC 178/2002, art. 18.2 and 18.3). Violation of these requirements is now subject in Italy to penalties up to 3% of turnover, as noted, up to 150,000 euros (Dongo, 2026). GS1 standards offer tools to do this interoperably.
The GS1 Global Traceability Standard defines the process and system requirements for supply chain traceability (GS1, 2017). EPCIS 2.0, ratified in 2022, allows different applications to record and share events: shipments, receipts, transformations. It also includes structures for sensor data, useful for example to associate temperature readings with individual batches in the cold chain (GS1, 2022).
The value lies in the links. A pallet can contain multiple batches and a batch can be distributed across multiple pallets. With GTIN, batch and SSCC recorded at each step, a recall can be limited to only the affected units, making a quantum leap in efficiency in managing food safety crises and quality non-conformities.
Digital Link and 2D codes towards 2027
GS1 Digital Link It is a web address with a standard structure that incorporates a GS1 identifier, such as the GTIN, and links the product to all kinds of online information (GS1 Italy, n.d.-b). One single QR code can thus serve the warehouse, the point of sale, and the consumer. GIFT and Food Times have followed the evolution of the standard since its introduction and its first large-scale Italian application in wine with Brindo, the service of GS1 Italy Services for digital labeling (Dongo and De Nobili, 2020; Dongo, 2023a; Dongo, 2023b).
Theindustry has set a precise goal, known as Ambition 2027. By the end of 2027, all cash register systems retail will have to be able to read and process a defined set of 2D codes with GS1 standard, alongside linear codes (GS1, n.d.). This is an industrial milestone, not a regulatory obligation: EAN codes remain in use. However, brand owners can already choose the 2D code most suited to their use cases and verify printing, size, and readability along the entire chain.
Digital labels and European Union rules
The QR code expands the information but does not replace the label. For prepacked foods, the mandatory information must appear on the packaging or on a label affixed to it (EU Reg. 1169/2011, art. 12.2). In distance selling, the same information must be made available before the conclusion of the purchase, except for the minimum durability date or the expiration date, and all at the time of delivery (EU Reg. 1169/2011, art. 14.1, lett. ‘a’ and ‘b’).
For wines, regulation (EU) 2021/2117 has allowed the provision via electronic label the nutritional declaration and the list of ingredients. The condition is that the page does not contain commercial information and does not collect or track user data (EU Reg. 2021/2117, art. 1). This is the area in which Brindo has demonstrated how a GS1 standard can make compliance simple and uniform for wineries.
How to start a project with your partners
Research shows that savings are born in the relationship. An effective project therefore involves both parties and can be divided into five steps:
- Measure the current process, detecting times, rework, errors and costs on comparable orders and deliveries;
- Align the master data, verifying items, recipients, units of measure and packaging hierarchies, also through the GDSN;
- Connect physical and digital flow, introducing SSCC and shipping notice on a defined set of relationships and references;
- Agree the operating rules on order cut-off times, delivery windows, load requirements, and remaining commercial life;
- Compare the results for both actors, including investments, maintenance, and training.
The useful indicators are the share of deliveries with consistent SSCC and notice, receipt times, manual corrections, punctuality, completeness, and the cost of anomalies. The explicit comparison between investments and benefits makes the project sustainable even for small businesses.
A relationship investment
The research by GS1 Italy and ECR Italy makes visible and measurable a cost that so far remained dispersed among order offices, docks, and administration. GS1 standards offer tools to reduce it: correctly identifying goods and locations, synchronizing master data, exchanging structured documents, and linking supply chain events.
The CEO of GS1 Italy, Bruno Aceto, points out the need for 'integrated relationships, common standards, and data transparency' (Tendenze Editorial Staff, 2026). For Italian agri-food companies, and especially for those serving large-scale retail trade (GDO), adopting standards is an investment that pays off concretely in customer relationships.
Dario Dongo
References
GS1 Italy research and documentation
GS1 Italy. (2026a, May 28). The hidden costs of the supply chain [Conference, Milan]. https://gs1it.org/chi-siamo/eventi/20260528-convegno-i-costi-nascosti-della-filiera/
GS1 Italy. (2026b). The hidden costs of the fast-moving consumer goods supply chain. Analysis of logistics costs in the producer-GDO relationship [Bluebook ECR Italy; research conducted by Fabrizio Dallari, LIUC Università Cattaneo, and Marco Melacini, Politecnico di Milano]. https://gs1it.org/files/sharing/1779208609/4011/gs1-italy-analisi-costi-logistici.pdf
GS1 Italy. (n.d.-a). Exchange digital and error-free documents with GS1 EDI and Euritmo. Accessed October 14, 2026. https://gs1it.org/migliorare-processi/gs1-edi-euritmo-scambio-documenti-digitali-senza-errori/
GS1 Italy. (n.d.-b). GS1 Digital Link. Accessed October 14, 2026. https://gs1it.org/migliorare-processi/migliorare-servizio-consumatore/gs1-digital-link/
GS1 Italy Services. (n.d.). Align. Accessed October 14, 2026. https://servizi.gs1it.org/servizi/allineo/
Trends Editorial Staff. (2026, June 3). The lever to reduce costs in logistics. Trends, GS1 Italy. https://tendenzeonline.info/articoli/2026/06/03/la-leva-per-ridurre-i-costi-nella-logistica/
GS1 standards
GS1. (2017, August). GS1 Global Traceability Standard. The Business Process and System Requirements for Full Chain Traceability (Release 2.0). https://www.gs1.org/standards/traceability/traceability/2-0
GS1. (2022, June). EPCIS Standard (Release 2.0; repository EPCIS/CBV 2.0.1). https://ref.gs1.org/standards/epcis/2.0.1/
GS1. (2026, January). GS1 General Specifications Standard (Release 26.0). https://ref.gs1.org/standards/genspecs/26.0.0/
GS1. (n.d.). GS1 Company Prefix. Accessed October 14, 2026. https://www.gs1.org/standards/id-keys/company-prefix
GS1. (n.d.). What is Ambition 2027 in Retail? GS1 GO Customer Service Portal. Consulted on October 14, 2026. https://support.gs1.org/support/solutions/articles/43000743530-what-is-ambition-2027-in-retail-
European Union regulatory sources
Regulation (EC) No 178/2002 of the European Parliament and of the Council of 28 January 2002 laying down the general principles and requirements of food law, establishing the European Food Safety Authority and laying down procedures in matters of food safety. Consolidated text: 01/01/2026. http://data.europa.eu/eli/reg/2002/178/2026-01-01
Regulation (EU) No 1169/2011 of the European Parliament and of the Council of 25 October 2011 on the provision of food information to consumers. Consolidated text: 01/04/2025. http://data.europa.eu/eli/reg/2011/1169/2025-04-01
Regulation (EU) 2021/2117 of the European Parliament and of the Council of 2 December 2021 amending Regulations (EU) No 1308/2013, (EU) No 1151/2012, (EU) No 251/2014 and (EU) No 228/2013. OJ L 435, 6.12.2021, pp. 262-314. http://data.europa.eu/eli/reg/2021/2117/oj
Insights on GIFT, Food Times and FARE (Food and Agriculture Requirements)
Dongo, D., Roveta, M. (2026, ). Traceability, criteria for calculating penalties. FARE (Food and Agriculture Requirements). https://fareagrifood.com/2026/09/23/calcolo-sanzioni-rintracciabilita-alimentare/
Dongo, D. (2023a, December 8). Brindo, the GS1-Italy QR code Services for wine labeling. Food Times. https://www.foodtimes.eu/it/consumatori-e-salute/brindo-il-qr-code-di-gs1-italy-servizi-per-letichettatura-dei-vini/
Dongo, D. (2023b, February 24). EAN, QR Code, RFID, NFC. ABC of global standards. GIFT (Great Italian Food Trade). https://www.greatitalianfoodtrade.it/notizie/ean-qr-code-rfid-nfc-abc-degli-standard-globali/
Dongo, D., De Nobili, M. (2020, July 11). IoT Technology and food labels, the new GS1 Digital Link standard. Food Times. https://www.foodtimes.eu/it/sistemi-alimentari/tecnologia-iot-ed-etichette-alimentari-il-nuovo-standard-gs1-digital-link/
Dario Dongo, lawyer and journalist, PhD in international food law, founder of WIISE (FARE - GIFT – Food Times) and Égalité.
