Digital Product Passport, Sustainability, & iPaaS
The circular route to sustainability with the Digital Product Passport
And the iPaaS: a future-proof solution to bypass the complexities of DPP creation!
Sustainability has long moved up from the footnotes of business plans to the headlines of core strategic goals for future-driven businesses. While by virtue, it is an urgent global recourse to push back the threat of climate change, enterprises are now seeing the business value of adopting a more sustainable approach. It is now being realized as a means to lower operational costs, reduce wastage, and increase ROI along with brand value. At the same time, there’s the mounting pressure from world governments imposing increasingly strict legislation on organizations to lower their environmental impact.
In its drive to push for a circular economy in this growing eco-conscious climate, the European Union (EU) has announced a new upcoming legislation that will require nearly all products sold to have a Digital Product Passport (DPP). These DPPs will require businesses to create and attach a digital document to every product (as a QR code, NFC chip, or RFID), which will detail the product lifecycle, supply chain, recyclability, and overall sustainability of a product. However, the pressing questions this raises for forward-thinking businesses are: what’s the best way to create these Digital Product Passports? What are the best tools to enable DPP creation? And how can businesses swiftly add and integrate all this new sustainability-related product data across their product management applications? That’s where the Alumio iPaaS (integration Platform as a Service) comes in!
After all, in order for manufacturers, suppliers, and retailers to track the sustainability of every product in a way that encompasses its origin, composition, and entire lifecycle, they will need to enable data integration across the entire Value Chain. Alumio is a next-gen middleware solution that helps simplify the integration of multiple systems, applications, and data sources, helps synchronize data in real-time across connected systems, and enables limitless workflow automation - fulfilling all the critical requirements to simplify DPP creation.
This white paper explores (1) sustainability as an enabler of future-proof businesses, (2) the Digital Product Passport as an enabler of sustainable business practices, and (3) the iPaaS as a key enabler and simplifying tool for Digital Product Passport creation. To extrapolate these ideas, the paper will delve into:
The need for sustainability and circular economy practices
Our economies are currently using earth’s resources 1.7 times faster than our planet’s biocapacity can regenerate every year. Annually, the world generates 2.2 billion tonnes of solid waste, and that’s expected to grow to 3.4 billion tonnes by 2050.
According to the World Economic Forum, about one-third of that waste is not managed properly. By volume, global waste includes 44% food and organics, 17% paper, and 12% plastic. We’re throwing away over 50 million tonnes of electronic and electric goods worth 63 billion dollars every year, including rare earth minerals, gold, and copper. The research shows that while the transition to renewable energy can only address 55% of emissions; the remaining 45% comes from producing cars, clothes, food, and everyday products. What’s more, we’re expected to throw away 148 million tonnes of clothing each year by 2030.
But, what if all this waste was in fact nothing but wasted profits? For instance, what if all that wasted clothing could be used to generate $500 billion worth of value, and what if all those wasted electronic and electric goods could be worth over $62 billion? The means and methods to achieve these profits while ensuring a more sustainable planet is a circular economy. It’s a revolutionary idea that eliminates the idea of waste altogether, and moves the world in a direction of reusing materials and resources.
Sustainable development is a fundamental break that’s going to reshuffle the entire deck. There are companies today that are going to dominate in the future simply because they understand that”.
What is a circular economy and how does it work?
A circular economy is a system aimed at eliminating waste and the continual use of resources. Unlike the traditional linear economy (take, make, dispose), a circular economy emphasizes reusing, repairing, refurbishing, and recycling existing materials and products. This approach reduces the need for raw material extraction, conserving natural resources, and minimizing environmental degradation. By designing products for longevity and ease of disassembly, manufacturers can significantly reduce waste, lower carbon emissions, and create sustainable production processes.
Circular manufacturing can also involve lean manufacturing processes, where the focus is on producing only what is necessary to meet demand. It is worth mentioning that businesses that have made significant improvements to manufacturing, service, and maintenance operations through lean techniques have reduced costs by up to 50%. Additionally, this can also include implementing recycling programs for packaging and repurposing waste materials.
Business models in the circular economy go beyond traditional production cycles. Digital technologies like the Internet of Things (IoT) and blockchain play a key role in enabling circular practices by allowing manufacturers to track product lifecycles, manage waste more effectively, and ensure products are returned for reuse. Additionally, artificial intelligence can help optimize production processes, further reducing waste. Product-as-a-service models and sharing platforms encourage consumers to rent or lease items, rather than own them. Additionally, take-back schemes incentivize businesses to retrieve their products for recycling or refurbishment, helping close the loop.
According to World Metrics, the circular economy market was valued at $582.12 billion in 2020. By 2025, the circular economy market for textiles is expected to reach $215 billion, the market for remanufactured goods in the circular economy is expected to reach $100 billion, and the market for circular electronic waste management is expected to reach $102.9 billion by 2025.
Most importantly, circular economy practices foster economic benefits by creating new business opportunities and jobs within realms of product repair, refurbishment, and recycling. Companies that adopt circular practices can achieve cost savings through reduced material expenses and waste management costs.
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Why is the European Union pushing for a circular economy and DPP?
The European Union, in particular, is particularly alarmed that 5 million tons of clothes are thrown away in in Europe every year, which is about 12 kg per person. At the same time, fast fashion is a big problem, as is the extent of fake claims about green action, known as greenwashing. In fact, 53% of green claims contain vague, misleading, or unsubstantiated information. Thus, as mentioned earlier, the EU is pushing for a circular economy and better sustainability tracking, and as a key part of this initiative - it is expected to pass legislation in 2025 that necessitates all products to have a Digital Product Passport (DPP).
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Digital Product Passport: definition, urgency, and how it works
A Digital Product Passport is a comprehensive digital record that is to be made available on products (via a QR code, barcode, or any other scannable technology), transparently detailing every aspect of a product’s lifecycle from raw materials to supply chain to end-of-life disposal. A DPP also quantifies the overall carbon footprint of a product and it can also include the environmental safety standards a product meets.
The objective of the DPP is to make consumers aware of the sustainability and recyclability of a product, while encouraging manufacturers, suppliers, and retailers to lower their environmental impact and embrace circular economy practices. At the same time, DPP creation necessitates finding more efficient ways to refine, integrate, and synchronize product lifecycle data across the Value Chain. While this can be done manually, an integration platform helps signficantly speed up and automate the processes involved.
In terms of business benefits, building Digital Product Passports helps streamline operations, improves supply chain efficiency, and adds a market differentiation to one’s brand. By ensuring that companies deeply analyze the environmental impact of their products, DPP creation also helps discover operational inefficiencies, savings on product material costs, areas for minimizing wastage, and supply chain efficiency improvements. Most importantly, at this stage, embracing the DPP can help organizations acquire the early adopter advantage and help significantly improve their brand value and customer loyalty.
The urgency to build Digital Product Passports
The EU is expected to pass legislation necessitating Digital Product Passports as soon as 2025, initially prioritizing compliance on particular industries such as batteries & vehicles, electronics & ICT, textiles, furniture, plastics, construction, and chemicals. However, it is expected that the DPP will eventually be made mandatory for all other industries by 2030. The AGEC law in France has already required manufacturers to provide extensive environmental information to consumers about their products, since 2023.
Brand manufacturers that create their own products are already in a position to transition their production processes and collect sustainability-related product data for DPP creation. On the other hand, retail customers will have to work with manufacturers that can provide them with the relevant sustainability data of products, in order to comply with the legislation. Businesses that have already gotten ahead of the curve and created their Digital Product Passports are now using it as effective marketing material and making it available on products to encourage eco-conscious customers to scan and buy.
Afterall, the primary motivation behind passing legislation that ensures businesses adopt practices such as Digital Product Passports (DPPs) is to help curb the escalating challenges of environmental degradation and resource scarcity across the globe. As such, governments, consumers, and investors are increasingly demanding improved sustainability, accountability, and transparency from products. DPPs are a means to provide this critical visibility that helps facilitate more informed and sustainable decision-making.
A First Insight report reveals that 62% of Gen Z shoppers prefer to buy from sustainable brands, and a staggering 73% are willing to pay more for sustainable products”
How to build a Digital Product Passport
While building a DPP can vary and span from several months to a year or more, it mainly depends on the complexity of the products and the readiness of the company's data infrastructure. While many businesses might find themselves in the early stages of planning and implementing DPPs, early adopters are already aligning internal processes to meet upcoming sustainability regulations like DPP to gain the competitive advantage. Also, businesses with a more diverse and complex range of products will take a significantly longer time to build Digital Product Passports.
On a basic level, the process of building a Digital Product Passport will undergo the following steps:
1. Identify relevant data points
Determine the critical sustainability-related data to include in the DPP, such as materials, production processes, environmental impact, and end-of-life considerations.
2. Data integration
All of this data then needs to be consolidated from various systems such a PLM, ERP, or PIM systems (we’ll explore these in detail below). This data then needs to be standardized and integrated manually within a central database, or ideally by using a cloud-native integration platform like Alumio.
3. Determine the DPP structure
The DPP needs to be designed by including necessary data fields, metadata, new attributes, and access permissions. It needs to be designed to be accessible to relevant stakeholders, such as manufacturers, retailers, consumers, and regulators, via QR codes, PDFs, or other mediums.
4. DPP creation and propagation
The DPP then needs to be created by compiling, enriching, and publishing the relevant data across relevant mediums such as product catalogs, websites, and marketing material, ensuring accuracy and completeness. This can be done manually or automated via PIM (Product Information Management) apps.
5. Product updates
Throughout the product's life, additional information, such as repair records or recycling processes, can be added to the digital passport, ensuring up-to-date transparency. An integration platform like Alumio helps automate the real-time data synchronization this requires, and provides access control to protect sensitive data and comply with privacy regulations.
As identified and indicated frequently throughout the Digital Product Passport creation process, it can be seen that the tedious manual work it involves can be significantly simplified with tools like PLM and PIM systems, and solutions like the Alumio integration platform. Let’s explore all the systems, applications, and tools businesses need to use in order to simplify Digital Product Passport creation.
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Essential tools and apps to enable Digital Product Passport creation
Creating a Digital Product Passport (DPP) requires a suite of tools and applications that facilitate product data collection, integration, management, and propagation. Here are some essential tools and applications needed to facilitate the creation of DPPs:
The need for a Product Lifecycle Management (PLM) system for DPP creation:
PLM software helps manufacturers centralize all product-related data, including design specifications, material compositions, compliance documents, and sustainability metrics, ensuring that every aspect of the product's lifecycle is meticulously documented. As such, leveraging PLM systems as a starting point in the DPP creation process ensures holistic and relevant product data, which can be used to track and trace the product across its entire lifecycle. Integrating a PLM system in the DPP creation process ensures real-time, up-to-date information, and it helps identify components or production processes that need to be changed or optimized to lower the environmental impact of a product (or to increase its sustainability).
The application of a Product Data Management (PDM) system for DPP creation:
Typically included as a key module in holistic PLM systems, Product Data Management (PDM) tools serves as a central hub for all product-related data. They help organize and manage a vast array of information generated during a product's development, including CAD models, engineering drawings, material specifications, and version histories. They can be effectively used by engineers to analyze material composition, manufacturing processes, and assembly techniques to identify areas for improvement. This data-driven approach in tandem with the tools of a PDM can be used to redesign products to lower their overall carbon footprint, in order to help build more promising Digital Product Passports.
The advantage of an Enterprise Resource Planning (ERP) system for DPP creation:
ERP systems provide a critical foundation for Digital Product Passports because they help integrate and manage core business and product management processes such as procurement, production, inventory, and sales within a single, unified platform. They offer insights into production processes, material consumption, energy usage, and supply chain information. This data is invaluable for creating comprehensive DPPs that accurately reflect a product's environmental impact. By integrating ERP data with other systems like PLM and PDM, organizations can build a holistic view of products, enabling data-driven decisions and improvements in sustainability practices.
The benefit of a Product Information Management (PIM) system for DPP creation:
Product Information Management (PIM) systems are another essential tool that enable Digital Product Passport creation. They play the crucial role of being the single source of truth for all product data. PIM systems centralizing product data and help enrich it with attributes, descriptions, images, specifications, and translations, ensuring that every piece of information is accurate, up-to-date, and consistent across all marketing and sales channels. In other words, apart from helping automate product data refinement, PIM systems allow companies to easily aggregate and distribute product data, which is critical for the creation of a comprehensive Digital Product Passport. Most importantly, PIM system helps translate and localize product data, enabling the DPP creation according to regional and market-specific needs.
While the creation of a robust Digital Product Passport (DPP) relies on the vital roles played by PLM, PDM, ERP, and PIM systems, the true potential of these application can only be unlocked and amplified through seamless integration. To ensure all these systems work together and exchange data in real-time, modern businesses can benefit most from implementing the Alumio iPaaS (integration Platform as a Service). Apart from synchronizing data between integrated systems, the Alumio iPaaS also offers the flexibility to connect more applications to existing integrations (that might be relevant to DPP creation), such as - e-commerce applications, business intelligence or AI apps, or any latest sustainability tracking and management software.
Simplifying Digital Product Passport creation with the iPaaS
The Alumio iPaaS (integration Platform as a Service) is a cloud-native, low-code middleware that helps connect two or multiple systems, apps, or data sources. As an API-driven solution, it helps develop, govern, and orchestrate integrations from one user-friendly interface. The iPaaS helps import, export, and synchronizes data between all connected systems. It also provides a wide range of tools and connectors to build faster integrations with popular ERP systems, PLM, PDM, and PIM applications, supply chain solutions, and manufacturing systems. All of the above is very crucial to facilitate Digital Product Passport creation.
Without the Alumio iPaaS, the integration of these complex systems would be cumbersome and prone to errors, compromising the accuracy and effectiveness of the Digital Product Passport. Thus, the iPaaS can be seen a shortcut or bypass to skip the complexities of successfully creating accurate Digital Product Passports. Enabling organizations to harness the full power of their digital ecosystems, the Alumio iPaaS simplifies DPP creation by ensuring all relevant product information is accurately captured, transformed, and synchronized across integrated apps. It also helps transform data and automate workflows to seamlessly move data between integrated systems, which is essential to automate the DPP creation process. Most importantly, it synchronizes real-time updates of new sustainability-related data across integrated systems to enrich DPPs.
The benefits of creating Digital Product Passports with the Alumio iPaaS
By leveraging the power and scalability of the iPaaS to create DPPs, organizations can create a robust digital ecosystem that not only meets regulatory requirements but also drives innovation and fosters consumer trust. As such, some of the many benefits of using the iPaaS in DPP creation include:
The Alumio iPaaS automates many of the manual processes involved in DPP creation, such as data aggregation, validation, and reporting. This reduces the time and resources required to create DPPs.
The Alumio iPaaS provides robust traceability features to ensure all data integrated into the DPP adheres to regulatory requirements. It reduces the risk of non-compliance with safety and sustainability regulations.
The Alumio iPaaS is inherently scalable, allowing organizations to easily expand DPP creation capabilities. Whether adding new products, integrating additional systems, or adapting to changing regulations, the iPaaS provides the flexibility to scale without loss of data integrity.
By centralizing and integrating data from multiple sources, the iPaaS fosters better collaboration across departments and with external partners. All stakeholders can contribute to the DPP via the iPaaS, improving communication, reducing errors, and ensuring everyone works with accurate data.
The iPaaS accelerates the DPP creation process by enabling quicker data integration, validation, and reporting. This speed allows companies to bring products to market faster with fully prepared DPPs.
The iPaaS ensures that data flowing into the DPP creation process is consistent, accurate, and up-to-date. By automating data validation and reducing manual entry, it minimizes errors and ensures the integrity of the product information within the DPP.
Case study for Digital Product Passport creation: XSARUS & Vogels
We recently interviewed Alumio integration partner, XSARUS, which is one of the biggest digital commerce agencies in The Netherlands, to acquire their industry prspective in already helping customers build Digital Product Passports. They gave us insight into their case study where they helped build DPPs for Vogels, a leading developer of high-quality TV brackets, monitor mounts, and LED suspension systems for consumer and business markets.
Looking to reduce their environmental impact, Vogels partnered with a brand called Ecochain in order to use their Mobius software solution, which helps map the carbon footprint of products in detail. They spent around a year having Mobius analyze all the components and production details of all their products, which was stored in their product data management solution (PDM) called SolidWorks. This made it possible for Mobius to create a detailed calculation of the GWO (Global Warming Potential) of their products. Apart from acquiring the data they needed to build their DPPs, the entire process also yielded valuable data that can be used to reduce the environmental impact of their components, processes, packaging, and more.
XSARUS helped use all the sustainability-related product data that Mobius generated to create detailed, marketing eco-sheets about the environmental impact of all Vogels products. Using the PIM system inriver, they created 54 new product attributes to accommodate the new DPP-related product data. These attributes help automate the creation of eco-sheets that are then made visible online on the product details page. This whole process is integrated with Vogels' Bynder DAM system, where the PDFs are automatically placed and provided with metadata.
In conclusion
The urgency for sustainable economies has never been greater, with the manufacturing industry and other sectors recognizing their roles in driving environmental impact. The transition to a circular economy—where products, materials, and resources are kept in use for as long as possible—is not just a necessary goal but a business imperative for future-proofing organizations. The Digital Product Passport (DPP) emerges as a crucial legislative tool in this transformation, enabling transparency, traceability, and accountability across the entire product lifecycle. By documenting every aspect of a product's journey, from raw material sourcing to end-of-life management, DPPs will empower businesses to meet stringent sustainability targets, comply with global regulations, and foster consumer trust in a new era of sustainable commerce.
However, the creation and management of DPPs demand seamless integration of various business systems, such as PLM, PDM, ERP, and PIM. This is where Alumio iPaaS (Integration Platform as a Service) plays an indispensable role. The iPaaS simplifies the complex process of connecting these systems, ensuring that accurate, real-time data is aggregated into the DPP with minimal manual intervention. By streamlining workflows, enhancing collaboration, and automating compliance, the iPaaS not only makes DPPs more accessible but also drives operational efficiency. Businesses must recognize that adopting iPaaS is not just about technical integration—it's about laying the foundation for a sustainable future, where digital innovation meets environmental responsibility. The takeaway for future-focused businesses is clear: embrace DPPs, integrated data ecosystems via the iPaaS, and most importantly, sustainability.
