Shifting towards the globalized world, supply chains are becoming more complex, inefficient, and expensive due to their involvement with many intermediaries. The supply chain process includes the collaborative system between product sources, merchants, and finally, the customers. However, this system often lacks transparency between stakeholders, and thus, its involvement with too many intermediaries makes the sector itself difficult to trace. By the end of the product line, end users might not be able to know the origin of the items. With this lack of traceability, there is no trusted way for the product to be verified for its authenticity. This can lead to fraud and mismanagement and eventually prevent buyers from trusting the goods.
However, this issue can be resolved by integrating blockchain technology into the industry.
Why should suppliers work with blockchain technology?
There are three main benefits that blockchain can help disrupt the supply chain sector:
- Enhancement in product traceability and provenance.
- Reduction of data disruption.
- Increase in working speed and efficiency.
Blockchain enhances traceability and provenance
Blockchain can be utilized as digital record-keeping technology. Once the data is on the network, it is immutable and transparent. This means that no one can alter the information uploaded on the blockchain thanks to the hashing technique. It is important that this data is recorded in the form of a hash – a unique value is given to the file.
With such characteristics, blockchain technology provides the industry with an accurate end-to-end tracking system. Companies can digitalize their physical assets, and record this data into the blockchain, then, any products can be traced to their origin or to any stages of the supply chain.
According to research, 79% of consumers agree on the importance of verifiable authenticity for the brand. Additionally, 71% of buyers are willing to pay additional costs for companies that offer full transparency and traceability in their products. This means that product transparency can show a superior sales results for enterprises.
Blockchain reduces data disruptions
Using distributed ledger technology, the supply chain can easily manage its product line and spot any disruptions. Managers can access an online data platform and upload shipment information to the blockchain. Once data is registered on the network, it is immutable and thus can be seen in the decentralized network. Suppliers can verify transactions using audits, preventing any planted duplicates.
Furthermore, a blockchain network is a safe and secure platform. Its hashing technique in addition to a fully decentralized network makes blockchain impossible to be hacked. This makes blockchain a perfect platform for data recording and storing.
Blockchain increases speed and efficiency
Companies can increase their work efficiency between different suppliers by maintaining control over all contract manufacturing. Blockchain technology can provide data access to all stakeholders which will reduce communication or transaction errors. All parties will save time to validate information while reducing the costs of errors. Thus, the technology can decrease administrative costs while increasing production speed by replacing paperwork with smart contracts and transactions recorded on the blockchain. Blockchain can also help the process of co-planning from different parties, as well as help forecast sharing between all the suppliers and customers.
How to implement blockchain technology in your business?
Working with blockchain can have many benefits, however, this complex technology can be very difficult and expensive to integrate. Companies must consider the cost and effort to hire blockchain developers and experts to help build their technology framework and infrastructure. Moreover, the prices of sending transactions on the blockchain are not stable and thus differ between networks. However, companies can avoid all of these complexities and extra costs by working with a scalable blockchain solution like BLOOCK.
- Decentralized ecosystems
- Transparency in transaction
- Immutable data
Additionally, BLOOCK can improve the transaction processing rate as well as lower the total gas fees. Our solution focuses on helping companies to record their data onto the Ethereum network without the complexity of blockchain integration. As our digital space grows, the need to secure and control your data is urgent. In the supply chain sector, organizations have enormous proportions of information, spread across many intermediaries and different stakeholders. Therefore, suppliers need to take action and normalize data recording and storage as the primary platform. Working with BLOOCK, the supply chain is guaranteed high scalability, extreme privacy, and easy adaptability to your existing IT infrastructure.
For more information on Blockchain and Supply Chain, check out Toptal’s “Digital Ledgers vs. Database: Can Blockchain Optimize Your Supply Chain?“