In the ever-changing landscape of finance, a remarkable phenomenon has taken hold: the rapid growth of decentralized finance, or DeFi. This ...
“The blockchain is an incorruptible digital ledger of economic transactions that can be programmed to record not just financial transactions but virtually everything of value.” ~Don & Alex Tapscott, authors Blockchain Revolution (2016)
According to a report from IDC, companies worldwide spent more than 2 billion USD on Blockchain technologies in the year 2018, and the numbers are estimated to rocket around 10 billion USD by the end of the year 2021.
Although cryptocurrency is one of the most widely appreciated applications of Blockchain technology so far, the retail and consumer goods industry is also trying its best to inculcate Blockchain technology from the past few years. Needless to mention, the technology has the potential to transform several other industries, retail being the one.
Reorganizing the digitization in the retail industry set-ups
The retail industry is a tight-margin business that is faced with a rising number of customers and a multitude of logistic challenges with all the challenges and difficulties of an effective way to digital transformation.
The most pressing concerns in the retail industry include:
1. Inefficiency in operations: Sioling and record-keeping are two major obstacles to efficient operations management in the retail industry.
2. Omnichannel shopping challenges: In the retail industry, consumers demand Omnichannel shopping but due to the data management hurdles the stakeholders in the retail industry are always lagging.
3. Consumer tracking: Consumers' data collection in the retail industry welcomes security risks due to the difficulties involved in compiling, sharing, and analyzing the increasing administrative costs.
4. Counterfeit prevention: The global counterfeit market in 2017, was worth $340 billion. This is mainly due to the damaging brands and degrading consumer trust and revenue.
5. Quality, provenance, and brand: Consumers are concerned about the provenance of their products, and many brands make fake claims of ethical sourcing with quality materials, which in turn affects the authenticity of the suppliers.
6. Regulatory compliance: The current supply chain, production, and point-of-sale technologies make it harder to monitor the regulatory compliance of the products.
The challenges are many, but Blockchain app development technology can help overcome the majority of issues by providing innovative solutions for the retail industry.
Why is Blockchain important for the retail industry?
Information is the lifeblood of business. The faster and more accurate it is received, the better. Because it delivers immediate, shareable, and entirely transparent information kept on an immutable ledger that can only be viewed by permissioned network users, blockchain is excellent for delivering information in the retail industry.
Orders, payments, accounts, production, and much more may all be tracked using a blockchain network. You can see all facts of a transaction fr0m a single view of the truth, providing you greater confidence as well as additional efficiencies and opportunities.
Here’s a graph depicting the rise of Blockchain adoption in the retail business:
Source: Blockchain in Retail Market Analysis, Growth and Trends | Forecast 2028 (marketresearchfuture.com)
Blockchain technology is potent enough to substantially impact the app development space.
Proper Inventory Management:
The innovative blockchain technology's first benefit is that it makes applications safer. The technique is capable of employing cutting-edge encryption. This technological idea is built in such a manner that it can provide the maximum level of security in retail supply chains through enhanced encryption.
In the Blockchain ledger, the information is saved and encoded in a cryptographic hash, which modifies every impossible block, making inventory management a transparent and easier process.
The figure below illustrates the role of Blockchain technology in the retail supply chain:
Source: Use of Blockchain in China’s Retail Industry | by moac.io | MOAC | Medium
Increase in product reliability:
Blockchain technology substantially improves the performance of operations in the retail industry, in addition to increasing data security. It is mostly because the Blockchain’s structure is resilient and dependable, and the network's architecture makes the network complete in the event of a breakdown or crash. Blockchain also includes several blocks that own data in multiple locations, making it more secure.
Any effort at illegal data alteration in the retail supply chains is prevented by the distributed nature of the blockchain servers and other related hardware. Due to multiple data centers in various places, even a large amount of product records is readily available.
Transparent supply chains:
Transparency is enhanced by security. Each transfer of cash is tracked by blockchain technology in such a manner that users can only monitor them when they wish. Any fraudulent transaction or falsified information in the retail supply chains is ruled out by the technology. The blockchain renders the program and the entire system impenetrable to tampering and fraud.
Blockchain technology can also assist entrepreneurs in gaining customer trust. Users in the retail industry may safely transact using such applications while remaining confident in the security of their personal information. The idea is also scalable, allowing numerous users to be managed at the same time.
Better customer identity management:
Another significant benefit of blockchain technology is its ease of use. When it comes to customer identity management, the blockchain offers a significant advantage over comparable models doing equivalent functions. Retail organizations mostly deploy client-server networking models, which are quite vulnerable to security threats.
Integration, maintenance, and modification of complex technology necessitate additional work, time, and money. To put it another way, sophisticated approaches contribute to higher app development and maintenance expenses. With Blockchain technology and immutable storage, authentication can be offered very easily.
Person to merchant transactions:
This is another cool feature of Blockchain that many retailers try to benefit from. Blockchain in retail stores offers efficient person to merchant transactions.
The blockchain eliminates the need for a middleman in the payment process, which has historically been a long and winding road. Blockchain mobile app development helps speed up cross-border peer-to-peer (P2P) remittance transfers. In areas where there are insufficient financial services, seamless payments can improve transaction efficiency in the retail business.
Source: Blockchain and Its Retail Potential - New West Technologies, Inc. (newestech.com)
Blockchain in retail- Use-cases:
Walmart is working on Blockchain retail adoption for food traceability. Hyperledger Fabric is being deployed to offer great technical support for the solution.
Here’s a depiction of how Blockchain is being integrated by Walmart for food traceability:
Blockchain at Walmart: Tracking Food from Farm to Fork | Altoros
Carrefour joined the Blockchain race a long time ago. Recently, they have started working on Blockchain applications in retail tracking for their products. According to the claims made by the industry, their sales increased drastically after they switched to Blockchain.
Alibaba, a famous retail service provider, is working on Blockchain to increase traceability for its products. More so, they have already built a cross-border e-commerce platform named Koala based on Blockchain technology.
This platform would record all the customs clearance, logistics details, and product registrations.
Source: Alibaba Aims to Prevent Retail Fraud with Blockchain | Altoros
Blockchain is a game-changing technology. It will make life easier and safer by altering how personal information is kept and how goods and services are purchased. Every transaction is recorded in an immutable and permanent manner using blockchain technology. Fraud, hacking, data theft, and information loss are all impossible with this unbreakable digital ledger. Manufacturing, retail, transportation, healthcare, and real estate are just a few of the industries that will be affected by technology. Google, IBM, Microsoft, American Express, Walmart, Nestle, Chase, Intel, Hitachi, and Dole are all pursuing blockchain adoption as early as possible. Blockchain has the potential to alter almost $400 trillion across numerous sectors.
As Blockchain technology has advanced so rapidly in recent years, it has looked into the market's demands and is serving as the best solution for the retail industry challenges. As mobile app developers integrate it into the worldwide app creation process, we can anticipate many of its breakthroughs in the retail industry.
It’s clear that blockchain technology is here to stay and if you are looking to integrate it into your apps, we are happy to assist you. Know more about our Blockchain solutions for the retail industry now.