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The fundamental concept of traceability is tracking the measurements of a product to collect data about various factors, such as temperature, location, manufacturing data or history of the product. As a result of IoT, traceability systems have improved across industries since many applications can be used to collect data that would not otherwise be possible. Tracing gives advantage to every owner to have detailed information from sourcing the raw material and assembling, distribution and sales. The IoT tracking sensors locate the geolocation of products in real time with wireless technologies. This digitized method has boosted the traceability system to work globally in real time. The traceability system can be done downward and upward or internally and externally.

The Traceability system works with two key constituents to strengthen the system, in which first one is coding, and another is central recordkeeping. The coding process works with the specific tag for each product, batches, or production units. Here various kinds of tags are used like 2D barcodes, RFID tags or data matrix ID to reduce the manual work and error-prone situations. Furthermore, in central recordkeeping, from the starting manufacturing process the identification is given to the product and uploaded to a central database combined with the whole information captured in each workstation. At each transit stage, information is added to create a stronger history of the production. The traceability system assists in quality control and gives accurate information about each transit stage of the product.

The use of IoT technology with a traceability system has enabled the whole process to work more efficiently with limited human resources, while enhancing visibility and transparency. It also leads to cost saving for every manufacturing unit. Through wireless connections and RFID tags, the tracking system provides real-time information about the temperature, location, and evolution of the product. This system eliminates the need for any organization or manufacturer to recall the processes of any entity. Additionally, in quality control, the traceability system works effectively to acknowledge the temperature and location as in the food industry it is very essential to track the temperature to maintain the quality. Besides ensuring that the product is produced correctly, traceability also prevents any manufacturing steps from being missed.

Overall, the traceability system helps to collect data and facts of any product from the beginning stage of manufacturing through distribution till the end stage, which is sale of the product.