PTI Compliance What every Grower Shipper Should Know

1. PTI ComplianceWhat every Grower Shipper Should Know March 23, 2011 Todd Baggett CEO RedLine Solutions, Inc. www.redlineforproduce.com tbaggett@redlineforproduce.com

2. Today’s Agenda • RedLine Solutions Introduction • PTI Compliance – What Every Grower Shipper Should Know • Question and Answer Time

3. RedLine Solutions: Background • Established in 1997 • Headquarters – Santa Clara, California • Central Valley Office – Fresno, CA • Southern California – Orange County, CA • RedLine provides complete Whole Chain Traceability Solutions • Hardware, software, professional services, support, and labels • We have automated over 100 fresh produce and fruit facilities • We have production customers doing PTI labeling for field packed items • Over 500 wireless network and mobile computer installations worldwide • North America integration, support, and repairs

4. RedLine’s Whole Chain Traceability Suite • Managing inventory and traceability from harvest to shipment • Provide PTI compliant case labeling, lot tracking, with electronic records • Barcode driven, standards based • Uses mobile devices over Wi-Fi and Cellular to gather and transmit data • Complete audit log including date, time, action, user • Manages internal traceability and publishes data for external use • Open architecture allows integration with other systems

5. Partnerships and Associations

6. The Food Safety Modernization Act Mandatory compliance is coming • Most significant legislation since 1938 • We owe thanks to the growers, retailers and trade associations that had the vision to create and move on the PTI ahead ahead of this legislation • The focus on prevention means traceability will become a standard part of audits • Implementation will phase in over three years • Retailers will drive PTI adoption in 2011 / 2012 • The Tester Amendment will not have any effect on retailer requirements

7. The PTI Mission “Create an Action Plan for the produce industry to adopt an effective Whole Chain Traceability program by incorporating the use of technology and use of common standards to serve as linkages between internal traceability programs.”

8. The PTI is: Providing the FDA with timely access to necessary information when a food borne illness outbreak occurs Limiting the scope of recalls to specific “Grower Lots of Interest” instead of recalling entire commodity groups Using standard data structures across the entire supply chain Case-level traceability The PTI is not: A comment about your already existing traceability systems A centralized database run by or for the FDA with everyone’s traceability information The ability to use your current proprietary tracking numbers with your existing tracking system Item-level source tracking DataBar for item checkout in retail stores The Produce Traceability Initiative

9. The Produce Traceability Initiative The PTI is: Labeling the carton, bag, bin at time of packing About Farm to Store or Restaurant About Whole Chain Traceability and reducing the time to trace-back and trace forwards The Produce Industry leading the Government Reducing risk in your business Increasing consumer confidence in the produce the eat The PTI is not: Changing your systems to use the GTIN as your Item Number About Farm to Fork Not about Scanning at the Store or Restaurant Serialization of lot numbers Throwing away existing traceability systems

10. Whole Chain Traceability Source Tracking # Grower PTI GTIN and Lot # Retail Packer / Processor Distributor / Wholesaler Distribution Center GTIN and Lot # GTIN and Lot # GTIN and Lot # GTIN and Lot # Consumer Item Source Tracking

11. PTI Milestones 4, 5, & 6 #4 Show human-readable information on cases • Packers are responsible for providing human-readable information on each case. #5 Encode information in a barcode • Packers are responsible for encoding the GTIN, lot number. #6 Read and store information on inbound cases • Each subsequent handler of the case will have the systems and capability to read and store the GTIN and lot number from each case of produce received. These Milestones are scheduled to be completed in 2011

12. PTI is Much More than Putting a Label on a Box • Source lot traceability at the case level, must track co-mingling of lots by pallet (Hybrid Pallet) • Internal Traceability extends from the Field through the Packing Shed and Cooler to customer shipment • Whole Chain Traceability – The GTIN and lot ID are recorded on all inbound and outbound transactions of each supply chain member • Electronic records shared within 24 hours of a request • Correct label on the correct box.

13. PTI Compliance Requires Time and Planning • Field • Combining geography, item, and date information on a single label • Different types of harvests require different PTI processes • The harvest plan can change multiple times per day • Packing • Volume and span of packing operations • Source lot control • Multiple concurrent pack configurations per packer and\or packing line • Cooler • Tracking pallet consolidation of partials from the field or packing shed • Tracking consolidation \ building of mixed pallets for specific customer orders • Tracking of product through required processes • You will need to pilot process changes • A well trained staff using effective system does not lose productivity

14. Process Improvements • Traceability (and PTI compliance) will require closing the gaps in current processes • Source lot control at bin level • Ad hoc sourcing (Order Substitution) • Delays between action and entering information • Inventory is not accurate in the system • Misses In-process visibility • Audits will reveal weak process links

15. Leverage your investment in PTI to improve operations • Improve visibility • “Cut to Cool” and other valuable cycle times • Real Time View into Packing for Sales and Operations • Automate receipt at the Cooler • Eliminate data entry errors • Reduce the time required to check in and receive a field truck • Data Analysis and Reporting • Wealth of new data available to help you better manage your operations • Differences in harvested quantity to received quantity at the Cooler • “Lost Pallet” issue • Use Information to Better Manage • Harvest and Pack Operations • Treatments and Resources (cooling tunnels, Hydrovacs, ripening rooms) • People • Order fulfillment

16. Real Time Visibility of Harvest and Pack • Ability to see planned, labeled, packed and received product in real time • Ability to see details on what is being harvested / packed • Ability to anticipate arrival times for special orders • Ability to track the changes to harvest plans • Sales can provide better information to customers • Operations can better manage staffing and resources

17. One Size Does NOT Fit All • Effective solutions differ for different Companies • Commodities • Scope and Span of Operations • Fulfillment Model • Effective solutions differ for different areas of operation • Field • Packing Shed • Cooler

18. PTI Best Practices are Evolving • Approved by Working Groups • Case label standards are being updated • Clarity on dimensions and quality of bar codes • Hybrid pallet tags • Approved by Leadership Council • PTI voice pick code • Not Approved by Leadership Council • Base GTIN’s for traceability

19. What Should I be doing? Understand and take action on the PTI Milestones www.producetraceability.org Get started now Define products for testing Start small, test the new processes Talk with your customers to understand their expectations and timelines Talk to your peers who have already been testing Talk with traceability vendors to scope your needs Stay connected Customers Trade Associations Industry Events- National and Regional www.producetraceability.org

20. RedLine Solutions is Your Partner for PTI Compliance RedLine Solutions provides complete traceability solutions Hardware, software, professional services, support, and labels Field Harvest through the Packing Shed to the Cooler and customer shipment Print what you need, whenever and wherever you need it Capture and transmit key information for early visibility Create and manage electronic records for traceability Our Solutions are designed working with leading produce companies While others are talking about solutions, RedLine is delivering

21. Webinar Series Join Us on April 20, 2011, 11am PST “PTI Labeling in the Pack Shed- Insights from PTI Pilots” Register at www.redlineforproduce.com/events Come see us at Booth 1454 at United Fresh in New Orleans

22. Questions?Contact us atinfo@redlineforproduce.comor 888-801-2039 Questions and Answers

23. Thank you for attending!To register for other events:www.redlineforproduce.com/events RedLine Solutions for Produce