What are the Benefits of Blockchain in Supply Chain Management?
Blockchain technology coupled with the ability to program business logic with the use of smart contracts enables the following:
- Transparency into the provenance of consumer goods— from the source point to end consumption
- Accurate asset tracking
- Enhanced licensing of services, products, and software
Even in today’s technologically advanced world, supply chains could dramatically improve efficiency, audible tracking, and limit exploitative behaviors. In the container industry, paperwork can account for half the cost of transport. A nationwide study conducted in the U.S. from 2010 to 2012 by the international ocean advocacy organization Oceana revealed that seafood is mislabeled up to 87% of the time. Mica, which is present in makeup, electronics, and automobile paint is often sourced from illegal mines by child laborers.
Furthermore, consumer goods, especially electronics, pharmaceuticals, and luxury brands, are susceptible to counterfeiting and fraud. In fact, a report from PwC claims that more than 2% of global economic output results from counterfeiting revenues.
The implementation of public, private, and hybrid blockchains will bring traceability, transparency, and accountability to the movement of goods and commodities. The technology can be applied to logistics to make business processes more efficient and to cut costs from supply chain infrastructure.