The year 2020 has officially come to an end, and this year was tough for all of us. Meanwhile, Blockchain arose as one of the most anticipat...
We consume a variety of products every day ranging from eatables to beverages, but have you how given a thought how far these products travel before reaching us? These products come through a wide and extended supply chain. Supply chain management, however, is loaded with a myriad of issues, certainly because of the presence of middlemen.
Before the Blockchain technology was integrated with SCM, middlemen played a great role in managing data and enabling trust in a supply chain. But one of the biggest disadvantages of involving middlemen is the increased probability of frauds, but thanks to Blockchain technology, we do have a solution.
Supply chain management – Challenges Involved
Have you ever wondered why do we need Blockchain at all, and what miracle Blockchain is going to do in the Supply chain? Well, to understand this, you need to take a sneak peek into the pitfalls of supply chain management. Below are some of the major ones:
- Data consolidation and visibility
Manual, paper-based record keeping of the supply chain data may involve scattered and incomplete information. Blockchain record-keeping solutions are best suited for concerns surrounding data consolidation and visibility, as all stakeholders have a common ground for sharing and storing information securely.
- Traceability, transparency, and trust
Tracking the source of the counterfeits and flawed parts is a difficult task, which reduces trust between various stakeholders of the supply chain. Integrating Blockchain technology in SCM gives the advantage of having an entire geographical flow of the products.
According to research, counterfeit food and beverages account for more than 70 percent of all the produces in the supply chain. With Blockchain technology, one can manage diverse stakeholders and guarantee that genuine products are being transported.
Supply Chain Management – Blockchain’s potential
With the distributed ledger driven by Blockchain, many industries can enhance the overall efficacy of the supply chain. Blockchain can revolutionize the entire supply chain. How? Well, there are many shreds of evidence to prove the same. Some of them are listed below:
- Traceable and Immutable Records
The data stored on Blockchain is immutable and requires digital signatures to access it, which confirms the information ownership. When multiple organizations are working together, they are privileged to store information on a common platform, and these records cannot be altered and are highly traceable too.
- Reducing supply chain costs
Various inefficiencies in the supply chain management create a lot of waste, especially in industries having perishable goods such as food industry. With the help of Blockchain technology, the fees associated with funds passing in multiple accounts and payment processors can be eliminated.
- Provenance tracking
It may sound crazy, but sometimes even the MNCs don’t have the complete knowledge of the backstories of the products in their supply chains. This lack of transparency opens up the gaps for cost overruns. A supply chain based on Blockchain can provide a definitive system of records, which helps in easy tracking of commodities involved in the supply chain.
Blockchain in Supply Chain – A Real-World Use Case
Remember the times when the E-Coli virus brought the spinach industry to a standstill? Well, it turns out that the food industry has experienced the magic of Blockchain and is using it to build efficient supply chains.
Many reputable organizations such as Walmart are teaming up with organizations that provide efficient Blockchain technology solutions that can be integrated into their supply chain management. One such organization is IBM, which provides the “Food Trust” Blockchain supply chain solution.
The following flowchart would help you to get a better view of how the Blockchain technology enables information and tracking of products.
In a nutshell, Blockchain technology has immense potential to serve humanity and solve real-life problems, but it is still in its early stages of implementation in Supply chain management. Getting the right technologies, lack of transparency, trust, and data consolidation are the main challenges in supply chain management. While integrating Blockchain technology in the Supply chain we can easily overcome these challenges.
Here’s a case study that will clear all your doubts and give you detailed insights into how Blockchain can transform FMCG supply chain – A Blockchain-based Coffee Supply Chain Solution
We are a reliable Blockchain development company with a paramount experience in developing innovative industry-focused solutions leveraging Blockchain technology. If you are also looking to streamline your supply chain operations through Blockchain, then we’ve got you covered. You can look around our Blockchain case studies to explore some of our past successes in the Blockchain space. Watch it in an exclusive demo session prepared exclusively for you. Schedule your demo session here.