What is a Digital Product Passport (DPP) and How Does It Work?

A Digital Product Passport is like a digital identity card that encompasses all the information about a product throughout its lifecycle. It includes data ranging from raw material sourcing to production processes, carbon footprint, and recycling information. This information is often linked to a QR code or barcode placed on the physical product, making it easily accessible through smartphones or other devices. Thus, all stakeholders can instantly see all the relevant information about the product and be assured of its transparency.

Digital Product Passports allow for the digital tracking of a product from its inception, starting with raw material sourcing, through production processes, distribution, to reaching the end-user, and even recycling. Thanks to these passports, products can be transparently tracked throughout their lifecycle, and this information is continuously updated. This is highly valuable in minimizing the environmental impact of products and building consumer trust.

How DPPs Work

• Data Collection: To make DPPs functional, data from raw material suppliers, producers, logistics companies, retailers, and recycling centers must be collected throughout the entire product lifecycle. The data collected at each stage is thoroughly analyzed and documented, providing transparency on every environmental impact and improvement made during the production process.
• Data Storage and Access: This data is stored on a secure blockchain infrastructure, preventing the alteration or manipulation of information. Since blockchain is a decentralized system, it ensures the reliability and integrity of data. Additionally, the information stored on the blockchain is traceable and can be shared transparently with stakeholders.
• Accessibility: All this information is presented to the consumer via a QR code on the product. Scanning this code with a smartphone reveals detailed product information, from the production process to the recycling phase. This allows consumers to learn the story behind the products they purchase and make informed buying decisions.

The Digital Product Passport not only enhances supply chain efficiency but also greatly contributes to the achievement of sustainability goals. Tracking a product’s lifecycle helps increase recycling rates, minimize energy and resource usage, and plan the necessary steps for improvement.

Advantages of DPPs for Consumers and Businesses

Advantages for Consumers

Informed Purchase Decisions: Consumers can access information about the environmental impact of products, ethical production standards, and recycling options, enabling them to make more informed choices. This plays a crucial role in reducing consumption-based environmental impacts.

Trust and Transparency: DPPs allow consumers to verify the authenticity of the products they purchase, protecting them from counterfeits. They can also see the conditions under which the product was produced, the sources of raw materials used, and the environmental impacts of these processes.

Enhanced Product Experience: DPPs provide instant access to user manuals, maintenance instructions, and repair information, enhancing the product experience. Consumers can also obtain information about potential repairs and maintenance throughout the product’s lifespan, which contributes to extending the product’s life.

Personalized Product Information: Consumers can access more detailed and personalized information about products. For instance, for food products, details such as production date, expiration date, and the origin of the materials used can be accessed through DPPs.

Advantages for Businesses

Achieving Sustainability Goals: Businesses can monitor the environmental impacts of their products and take concrete steps to reduce them. DPPs help ensure the transparency and reporting of these processes. Thus, businesses can achieve their sustainability goals while also meeting regulatory requirements.

Supply Chain Efficiency: Every movement of a product within the supply chain can be tracked, allowing for optimized inventory management. This leads to reduced costs and more efficient production processes. Additionally, recycling processes can be managed more effectively.

New Business Models: DPPs enable the development of new business models, such as product-service systems, rental models, and recycling programs. For instance, using DPPs for rentable products provides information on the product’s usage history and condition. Such models help businesses build longer-term and ongoing relationships with customers.

Competitive Advantage: Companies that lead in sustainability and transparency gain consumer trust, enhance brand reputation, and stay ahead of competitors. The transparency and verification mechanisms offered by DPPs also help brands increase customer loyalty and satisfaction.

Marketing and Customer Engagement: By providing more information about products, businesses can enhance customer engagement through DPPs. This can be used as a marketing strategy that adds value to customers and strengthens brand reputation.

Compliance of DPPs with European Union (EU) Regulations

Ecodesign Regulation for Sustainable Products (ESPR)

The European Union’s Ecodesign Regulation for Sustainable Products mandates the design of products based on criteria such as energy efficiency, durability, recyclability, and environmental impact. DPPs document compliance with these criteria transparently, facilitating adherence to this regulation. Transparent reporting of criteria like reducing the carbon footprint from production processes, optimizing energy consumption, and increasing resource efficiency makes compliance easier.

Circular Economy Action Plan (CEAP)

The CEAP aims to extend the lifecycle of products, reduce waste generation, and use resources efficiently. DPPs contribute to achieving CEAP goals by tracking the recycling and reuse processes of products. Thus, even after products become waste, their traceability is maintained, enabling more effective management of recycling processes and promoting efficient resource use.

New Battery Regulation

The New Battery Regulation introduces specific rules to reduce the environmental impact of batteries and increase recycling rates. DPPs facilitate compliance with this regulation by providing detailed information about battery components, performance, and recycling information. Battery manufacturers can use DPPs to document the source of materials used in production and recycling options, sharing this information with consumers.

In Which Sectors Will DPPs Be Used?

The European Union plans to initially make DPPs mandatory in critical sectors such as batteries, vehicles, textiles, electronics, furniture, plastics, construction, and chemicals. However it is expected that DPP applications will also become widespread in other product categories like food, cosmetics, and pharmaceuticals. In the food sector, DPPs will provide consumers with greater confidence by tracking products through every stage, from farm to table. In the cosmetics and pharmaceutical sectors, DPPs will help provide more information on product formulation, the origin of ingredients used, and their impact on human health.

Strengthening DPPs with Blockchain Technology

Blockchain technology is a powerful tool for ensuring the data integrity and transparency of Digital Product Passports. Thanks to blockchain, all data within a Digital Product Passport DPP is stored in a distributed network, minimizing the risk of manipulation. This enhances stakeholder trust in the data and contributes to high-level traceability. In particular, blockchain-based DPP usage in supply chains offers significant advantages for companies prioritizing data integrity and transparency. Additionally, blockchain technology increases the security of data transfers, enabling faster and safer information flow among all stakeholders.

The use of blockchain infrastructure not only ensures data security but also makes this data accessible and verifiable by everyone. This is particularly advantageous for complex supply chains, as every link in the chain can monitor the product’s stage and processes it has gone through. This helps businesses enhance transparency throughout the supply chain, improve reliability, and build a more responsible brand image in the eyes of consumers.

Doruksistem's DPP Preparation Service

DORUKSISTEM offers a comprehensive service for preparing and managing Digital Product Passports (DPPs). This service gathers all the necessary information about products, stores it securely, and manages it effectively. Using blockchain technology, Doruksistem ensures the reliability of the data and helps you comply with regulatory requirements.

The DPP preparation services provided by Doruksistem include:

• Data Collection and Analysis: Gathering and analyzing all the necessary data throughout the product lifecycle. This includes raw material sourcing, production processes, logistics, and end-user stages, providing guidance to businesses by analyzing the collected data.
• Creating the Digital Product Passport: Preparing the Digital Product Passport, which contains all the product information, and storing this information appropriately. The digital product passport provides detailed information about every stage of the product, from production to recycling.
• Blockchain Integration: Using blockchain infrastructure for data reliability and traceability. Blockchain technology ensures data is protected against manipulation, building trust among all stakeholders.
• Regulatory Compliance and Reporting: Ensuring compliance with national and international regulations and providing necessary reporting. This helps businesses meet their legal obligations while also reporting their sustainability goals.

Doruksistem AS supports businesses in achieving their sustainability and transparency goals by providing expert assistance throughout the Digital Product Passport DPP processes. This way, you can gain consumer trust and strengthen your competitive advantage. Furthermore, ongoing updates and consultancy services provided by Doruksistem ensure continuous improvement in regulatory compliance and sustainability performance.