The Future of Supply Chain and Logistics With Blockchain

Blockchain has already proved to be of great advantage in high-resource fields, such as mining where precious metals and precious gems need to be systematically tracked and sourced. Over some time, it’s likely that Blockchain technology will be integrated into the various other supply chain solutions across the globe.

To help you understand how blockchain can create a revolution in the existing logistics and supply chain industry, here are a few solutions we feel are ideal for it.

SUPPLY CHAIN

Building a Global Reach is Easier – Supply chains must now work seamlessly around the world. By employing the use of a decentralized database that enhances the tracking of all transactions, blockchain will make supply chain management more visible and consistent across the globe. To state simply, anyone from anywhere at any time can access the series of transactions being executed.

Improved Transparency Among Partners – By transparency, I mean that anyone can view the transactions on the blockchain’s ledger at any time. In the supply chain, this will help vendors and suppliers see transactions simultaneously and resolve issues, in case something arises. Such a factor makes it possible for them to securely conduct valuable transactions. Further, when used for shipping and logistics, blockchain promotes ease of tracking large-scale shipments and even works great for individual packages.

Improves the Sourcing Visibility – As in the blockchain, all transactions are visible, it could be of great help with tracking commodities. For eg, in the food industry, it can be used to denote where food has been sourced, and by whom it was sourced initially.

Let’s take another example of the diamond industry. Here, blockchain could be used to register and validate specific gems. Also, not to forget, it can be used to ensure that products are ethically sourced and that they have been acquired from safe, certified sources by sellers.

Better sustainability – Blockchain technology is scalable. This makes it possible to run extensive logistics and supply chain operations on it. More importantly, blockchain naturally supports environmentally-friendly, eco-conscious globalization.

LOGISTICS

First off, this industry is the backbone of just about every business across the globe. But unfortunately, managing the many links to the creation and distribution of goods is incredibly complex. For the most part, today’s supply chain can go through numerous stages, span over several different geographical locations and a boatload of payments and invoices. What’s more, the process involves several entities, most of whom may turn out to be less trustworthy than expected. In a nutshell; today’s supply chains are heavy with their own complexity and broken in more ways than one.

Blockchain technology can boost the efficiency and transparency of supply chains, banish inaccuracies, prevent frauds, and reduce expenses just to name a few. In a nutshell; the very things that are needed for the integrity, reliability and transparency in a supply chain lies in the blockchain.

Better Freight Tracking

Using blockchain in logistics systems and supply chain can help you track down freight more easily. At present, same-day deliveries and on-demand deliveries are increasing. So, it can quickly become a burden for logistics companies as they don’t have the infrastructure to meet up with the needs for these overwhelming demands. Many trucking companies are trying to invest in good tracking technology, but these technologies’ security is questionable.

Also, these technologies don’t have a secured authentication process. Therefore, cybercriminals or bad persons always take advantage of the network’s information. Blockchain can really change the scenario here. As blockchain offers a proper authentication channel with verification, no one can tamper with the data. Also, as you can keep track of all your deliveries and track the deliveries in real-time, it can really ensure a better consumer experience for the logistics industry.

Improved Shipping Process Efficiency

With blockchain, the first thing that will improve logistics is shipping and freight. In short, it can be used to improve the delivery process internationally and locally. It will also make them improve their goods capacity and improve their process efficiency.

Maersk already knows the importance of blockchain and has already incorporated blockchain into its processes and operations. They are one of the largest shipping container operators. The end goal is to track the shipment in the best possible way by working with other authorities. IBM is also working with Maersk to improve the global trade infrastructure. The blockchain in the supply chain will surely help save millions of dollars.

Inventory Tracking

Inventory tracking is complex. Companies spend a lot of money to make it perfect and efficient. And, even then, it offers a lot of problems. That’s why inventory tracking is one of the main focuses of the industries out there. To manage it, companies spend millions of dollars. Blockchain technology can help solve the problem by offering the ability to companies to not only manage their products at the macro level but also micro-level. For example, companies can keep full track of the logistics by monitoring it in a highly efficient manner.

Better Transparency

As mentioned earlier, blockchain technology can help improve supply chain transparency and of course, tackle the issue of integrity and credibility. At this point, our focus is on the challenge of knowing if the business information is “actually” trustworthy and reliable. And yes, this is a pretty big issue plaguing today’s supply chains.

Perhaps the biggest advantage of this revolutionary technology for transparency is that it’ll help build trust between companies. For the most part, B2B logistics will get to enjoy improved visibility and credibility, both of which are great for business. What’s more, blockchain systems will minimize invoice disputes, cut auditing costs and most importantly, prevent the exploitation of workers at ground level.

Any company implementing blockchain technology in this regard? Well, of course, there is! For the most part, Provenance has conducted several case studies with regards to supply chains based on the blockchain. The company teamed up with an international brand that had an interest in importing coconuts from Indonesia. For the most part, Provenance developed a system that made sure farmers got fair compensation for their efforts. What’s more, the system holds companies responsible for their claims and ensures that consumers are not left in the dark whatsoever. All in all, provenance is using blockchain systems to make logistics to be as transparent as can be.

Invoicing and Payments

Yes, this is yet another challenge in today’s logistics industry — in fact, it’s a pretty big one. Today, many companies find it hard to develop efficient and secure systems for invoicing and payments. But of course, the good news is, blockchain technology can provide a solution to the problem. And yes, we’re talking about processing payments via smart contracts — super efficient, transparent and error-free.

Moving forward, Tallysticks (an international trade solution) has built a blockchain-based platform that can process invoicing and payments for logistics and other businesses. As you probably guessed, the platform uses smart contracts to approve a payment that corresponds to an invoice. It’s also good to mention that the Global credit card giant Visa has also launched its blockchain-based B2B payments service. Yes, blockchain is truly the wave of the future!

Settling Disputes

Let’s face it; dispute resolution is one of the biggest challenges in cargo transportation. Of course, at this point, our core focus is on delayed or misplaced goods. As most of us know, this problem can take a heavy toll on companies. And most times, they may actually need to seek external help to iron things out.

Well, the good news is, the American multinational courier delivery service FedEx has implemented a solution that’s geared towards using blockchain to settle customer disputes. For the most part, FedEx will keep all parties in the know so as to ensure easier dispute resolution. In essence, the sender and receiver will be aware of the process before pickup and after delivery. And should any dispute arise, the third party or better still, independent auditors will no longer be called for resolution. FedEx’s blockchain-based ledger is enough to fix things!