Businesses aim for transparency, fair trade, and long-term sustainability in their buying choices at different levels. Complex and non-integrated supply chain networks, on the other hand, make it difficult to put these concepts into practice.
To make these procedures more transparent and coordinated, a huge number of companies have begun to use blockchain supply chain management. According to Statista, 55.3 percent of logistics service companies have invested in Blockchain technology.
This article discusses the real-world applications of Blockchain technology in supply chain management.
Additional expenditures incurred as a result of product fraud or duplication
Real-time monitoring of commodities is possible with blockchain, which lowers the total cost of transporting items in the supply chain. Companies can identify the problem in cases like product recalls or quality concerns by improving traceability, lowering the expense of determining the fundamental cause.
Supply chain management using blockchain devices
Traceability and accurate tracking
The status of a product is often recorded using blockchain technology at every step of its life cycle. This makes it easier to keep track of procedures right from the start. For example, Walmart, the world’s largest retailer, is aggressively employing this technology to track meat sales in China. Yes, this applies to each and every piece of meat.
The system identifies where the meat originates from, processes each step along the route to the customer, and keeps track of everything that happens in the supply chain up to the point of sale. The corporation has access to information regarding who sold the meat and who purchased it at any moment, which may be valuable in unusual circumstances.
Smart contract creation
A smart contract is a software that executes an agreement using Blockchain. Smart contracts may be integrated into your supply chain management system to avoid fraud and other forms of interference. It’s a software that leverages blockchain to carry out a contract. Because the software is kept on the blockchain, a smart contract can only function as intended. A smart contract is a computer software that can autonomously activate events based on its programming. A payment may be initiated by a product delivery logged on the blockchain, for example.
Developing a sense of trust
Establishing confidence among all parties involved is critical to the supply chain’s smooth operation. Each participant in the blockchain has a copy of the ledger and is aware of the origins of each piece. Everyone has access to information regarding who owned it before them and when they did.
Consensus and decision-making
For each product, blockchain is sometimes referred to as “one version of the truth.” It’s a record-keeping system that collects proof of monetary transactions like bills of lading and cash transactions.
It covers every step of the supply chain, from serialization to delivery to reception and installation, and it keeps track of everything. This approach is based entirely on the concepts of trust, openness, and comprehension.
The same information is available to all participants. If one of the participants attempts to defraud the system, he loses synchronization with it and is flagged as a danger. It acts as a strong disincentive to malware activity.
Transactions that are transparent
There is no need to utilize conventional banking since all transactions can now be as transparent as possible wherever in the globe. Money transfers between the payer and the beneficiary may be completed in a matter of minutes. You no longer have to wait a few days since everything is considerably quicker and secure with a blockchain-based system.
Monitoring the condition of the product
Certain foods, such as food and medication, are delicate and need specific attention. Sensors may detect and record information about product storage conditions such as temperature, humidity, and vibration. If one of the metrics deviates from the usual, the Blockchain participants will be notified promptly. In this situation, the smart contract can address the issue by doing the appropriate measures automatically.
In the supply chain, blockchain is gaining popularity
Many businesses are confronted with the difficulty of excessively complicated supply chain management, which wreaks havoc on other internal systems. Blockchain technology, on the other hand, has the potential to address severe monitoring and surveillance difficulties across the whole chain. It improves the efficiency of all processes involving the flow of goods, the storage and transportation of raw materials, the transfer of completed items from one location to another, and so on. As a consequence, there’s greater cooperation, inventory management, asset usage, and more.
