Blockchain technology and cryptocurrencies continue to disrupt multiple industries. One, in particular, is the supply chain industry. The very decentralized nature of blockchain technology is perfectly suited for every facet within supply chain management, and retailers are taking notice.
The push for integrating blockchain into supply chain management processes is based on one simple factor — efficiency. In fact, nearly 80 percent of companies with efficient supply chains are seeing higher profits than those with mediocre efficiency.
The increasing value innovative technology is adding within the reverse logistics space is important to consider as well. Supply chain solutions companies like goTRG are redefining how retailers are handling returns in order to maximize recovery by decreasing touches. Their clients include Target, Walmart, Home Depot, and other global corporations.
Blockchain very well may be the future of the supply chain. Here’s who is doing it now and why you should keep blockchain on your radar.
Top global retailer Walmart already integrated Blockchain technology
Walmart is a prime example. The global retail giant has been exploring blockchain, specifically for managing the supply chain of food. Shifting from traditional supply chain management to blockchain has a number of benefits for retailers like Walmart.
Walmart Inc. is getting suppliers to put food on the blockchain to help reduce waste, better manage contamination cases and improve transparency – Camila Russo, Bloomberg.
For instance, Walmart can now track food, like produce, in an astonishing two seconds, instead of the six days it took prior to integrating blockchain technology. The transparency involved can also help cut down on waste and health concerns over contamination.
Just look at how long it took to track one of the latest foodborne illness outbreaks, Rose Acre Farms Shell Eggs. What took two months to end could have been achieved in days using blockchain supply chain management processes.
Walmart leaned on IBM for support to develop and integrate blockchain technology into their current supply chain system. However, there are a number of startups hoping to fill the void for retailers looking for the same supply chain management technology.
Enhanced shipping intelligence via Blockchain
Blockchain technology can make shipping documentation, whether by land or sea, far more efficient. In fact, what now takes days or weeks could be completed in minutes. This can be impactful for the shipping industry since the cost of shipping could be significantly cut.
The current process involves the way to much documentation that is done via human and must go through the hands of governments, agencies, financial institutions, customs, and more. Blockchain can change this.
The blockchain also does away with the need for a number of third parties to verify different parts of the process, making the entire process more affordable and removing the extra costs forced onto customers – Tanvir Zafar of Hackernoon explained.
Reducing shipping costs can make a huge difference for businesses both large and small, especially if they are in the ecommerce space. With more accurate reporting and detailed analysis of spend, you can create an intelligent shipping plan.
The future of supply chain management
What does a blockchain supply chain management system look like? Within any retailer’s supply chain is product tracking. Unfortunately, traditional tracking is not transparent and fast enough to truly capture the journey a product takes.
Blockchain technology, on the other hand, can make this pain points obsolete for retailers. For example, retailers, manufacturers, and vendors can use digital tokens, kind of like Bitcoin or Ethereum, to track products as they move through the supply chain. From production to retailer shelf and into the consumer’s hands, each step of the process is accounted for.
Tracking products this way also adds value to the bottom line. Retailers can get a clearer picture of money spent, or wasted in some cases, along with the supply chain via the digital tokens assigned to each product and/or shipment. This is all captured in real-time as well.
Ready to integrate Blockchain into your supply chain?
Confidence, trust, accurate analytics, and data-driven decision making are just a few compelling features of blockchain supported supply chain management. Despite the features, however, many retailers are still a bit hesitant in integrating this more efficient technology.
Why? Many believe that in order to streamline their supply chain, they need to first disrupt their system on a grand scale. This is not true. The blockchain is actually integrative software. It is not meant to replace current systems retailers currently have in place.
It doesn’t replace infrastructure. It simply supports it. When integrated correctly, blockchain technology is integrated without disrupting anything. The day may come when a fully optimized blockchain solution will replace traditional supply chain systems, but we are just not there yet.