Is your manufacturing firm ready for DPP?

Forterro has taken another look at the data from its “The Digital Future of the European Industrial Midmarket” report. For an overall analysis of the findings Enterprise Times took a look back in November when the report was published.

Forterro has now examined the findings relating to the EU’s Digital Product Passport. The press release notes the lack of awareness among UK Manufacturers and wholesalers of its introduction, with only 47% of UK firms aware of it. Surprisingly, though, only 49% of similar organisations are aware of it. Furthermore, 19% are unsure whether DPP will affect them.

More worryingly, perhaps, is that only 43% are ready for the legislation, which is set to come into force within two years and be fully in force by 2030. Only 1% of respondents believed that DPP readiness is applicable to their business.

The report highlights that the main barriers to DPP readiness for UK manufacturers are:

• The complexity of requirements (47%)
• Insufficient internal compliance resources (42%)
• Lack of guidance (37%)
• A lack of suitable technology to manage compliance (35%)
• Cost (28%)

The cost, while ranked 5^th highest, might actually be a bigger barrier, with respondents estimating that the implementation cost would average £28,000.00. This is not a small figure, and the report lacked a qualitative element to break it down.

The main barriers to DPP readiness identified by UK industrial midmarket companies include: On average, UK firms expect to spend £28,000 on managing their DPP obligations over the next few years.

Claudia Schmidhäuser, Senior Principal, Product Management, Forterro, commented, “The Digital Product Passport will be to product manufacturing what GDPR was to data — it is that impactful. But it’s much more than a compliance issue; it’s an opportunity for greater transparency, sustainability and customer trust.

“We saw what happened when companies weren’t ready for GDPR, and too many UK midmarket firms are still unaware or underprepared. DPP requirements are approaching fast, so companies must act now to ensure their systems and data are ready.” 

What happens next

A DPP is a structured digital record that stores essential details, including a unique product identifier, compliance documentation, and information on material sourcing. It will provide comprehensive information about each product’s origin, materials, environmental impact, and disposal recommendations.

The passport will also contain user manuals, safety instructions, and guidance on product disposal. It aims to advance transparency and sustainability across products sold in the EU.

The DPP includes three categories of “Products”: new products, intermediate products, and horizontal products. For manufacturers, it is the intermediate products that are of most interest, with an estimated timeline for adoption for different products as follows:

• ICT products and Electronics – 2026/7
• Batteries – 2027
• Textiles/Apparel – 2027
• Furniture – 2028
• Mattresses – 2029

Intermediate products may affect some firms, including Iron & Steel (2026) and Aluminium (2027). Finally, horizontal products include:

• Repairability (including scoring) – 2027
• Recycled content and recyclability of electrical and electronic equipment – 2029

For organisations looking to manufacture or ship products into the EU, each product will need a digital product passport. There are penalties for non-compliance. Member states will set the exact financial penalty for failure to comply, but it is expected to be up to 5% of each member state’s annual EU turnover.

Challenges

DPP is just one of the environment regulations that will come into force over the next few years that could affect manufacturers. Compliance is seen as one of the biggest challenges facing European manufacturers (38%), alongside Data privacy and data protection (38%). 45% of respondents said that compliance influences their operational and technology purchasing decisions.

Organisations must remain compliant to avoid penalties and remain competitive. However, the good news is that 51% see compliance as a competitive differentiator.

The biggest concern for UK manufacturers is export costs in light of US tariffs (32%), compared to European Manufacturers (26%). The challenge with the US tariff is the volatility. However, with Starmer on a visit to China this week, is there a possibility of opening new supply and trade routes in a market already larger than the US?

Claudia Schmidhäuser, Forterro, added, “It’s a complex world to navigate for midmarket firms that might lack the expertise enjoyed by some of their larger counterparts. But it’s true that compliance and competitiveness now go hand in hand.

“Whether it’s DPP, environmental reporting, data protection or staying on top of rapidly changing tariffs, the companies that modernise their systems first will gain an advantage in efficiency, visibility and customer confidence. It can take a while to be ready for any new legislation, especially during the preparatory phase, so UK companies should begin now.”

Enterprise Times: What does this mean?

Forterro has highlighted key evidence on the UK manufacturing sector’s preparedness. What it fails to do is indicate how its technology can help those seeking compliance.

However, in a recent article in Logistics Business Magazine, Forterro’s Carrie Tallett does just that. She notes, “Traditionally, ERP has been seen as an operational tool for managing stock, production schedules and orders. But today, ERP is becoming the compliance backbone of the modern industrial business. The same system that drives daily operations is now central to ensuring transparency and regulatory alignment.”

What would be an interesting follow-up is for Forterro to explore the costs involved in the exercise. There is some interesting material available elsewhere, including a Tylko Advisors in-depth article on LinkedIn that identifies the reasons why most manufacturers are not ready for DPP. It provides four reasons, then delivers a five-step plan for achieving compliance.

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