After the sudden fame of bitcoin and cryptocurrencies, people started realizing the use and power of the blockchain technology behind it. One of the first application ideas was blockchain improving supply chain process and saving millions of dollar. Blockchain holds many benefits that fit perfectly on the needs that are required by the current supply chain industry.
Current supply chain and its defects
Today the management of chain, which involves the creations and distribution of goods is an extraordinarily complex task. The supply chain is spread across multiple geographical locations, hundreds of stages, payments and invoices, involve hundreds of people, entities and this number keeps increasing with each passing month. This increasing level of complexity and absence of transparency gives rise to the need of involving blockchain technology to come to the rescue. Blockchain improving supply chain can be the only solution out of it.
Our supply chains became more complex due to several shifts such as commerce gradually shifting from local to across the borders, emergence of personal computers in 1980s or the usage of trucks rather than rails to haul freight. Manufacturing has also been globalized with majority of it being carried out in China. It’s highly difficult for consumers to know about the true quality and value of the product due to lack of transparency. Similarly, it is also difficult to investigate supply chains if suspicion of illegal activities is involved. This whole procedure also proves to be inefficient when vendors and suppliers try to allocate resources during the whole process as to who needs what, how and when.
Benefits of blockchain
The main problem with the current supply chain is centralization and control by one central authority. Blockchain mainly tackles this drawback. The main features that makes blockchain improving supply chain effective than the traditional supply chain system are.
- Faster transfer speed
- Data integrity
How can blockchain help supply chain
Blockchain, the technology whose foremost properties are a distributed digital ledger system, which is completely transparent and can be used for any sort of exchange, agreement or contract and obviously the payment. Everything is traceable right back to its source. Once a block is added to the blockchain, none of the contents of the block and the blockchain as whole can be modified. Multiple copied of the transactions of the added block are sent across the ledger to the nodes. The blockchain technology is also highly secure since every block is linked to one another. There is no concept of a central authority in the blockchain and hence its very scalable and efficient. Thus, blockchain can not only increase the efficiency and transparency of the existing supply chains but also ensure quality control, resource monitoring, reliability, integrity and an improved payment system. So can say that blockchain improving supply chain is not a far fetched dream but with a little effort and dedication the industry can be improved.
Walmart, a famous name under the food industry, is one of the many industries who adopted blockchain for their supply chain management. It uses blockchain to keep track of the pork it sources from China and the blockchain records where each piece of meat came from, processed, stored and its sell date. Unilever and Nestle also incorporate blockchain.
The use of blockchain can totally transform the supply chain industry, owing to its many benefits, and ensure in gaining more trust of its increasing consumers. So Blockchain Improving Supply Chain isn’t a far fetched dream.
Read about all the industries that blockchain is changing in this blog here.
Checkout our sample implementation of a blockchain based supply chain.
If you want to get involved in the supply chain industry and want your application developed professionally, then contact our blockchain development company who will be more than happy to guide you and build it for you.