5 potential benefits of blockchain in supply chain logistics
The exponentially heightened expectations of modern customers makes supply chain logistics far more difficult. Thanks to the Amazon effect, customers want what they want, how they want it and as soon as they want it.
Blockchain for supply chain logistics can enable digital information sharing across a complex network in a trusted and secure way.
Here are five ways blockchain in logistics can help suppliers, manufacturers, distributors and retailers meet the demand for quicker, more convenient delivery of a wider variety of goods.
Additional scrutiny of high-value assets and high-value goods is necessary as they move throughout the supply chain, said Greg Carter, CTO at GlobalTranz, a transportation and logistics provider based in Scottsdale, Ariz. Blockchain offers validation that there’s been no disruption or corruption of the data when it comes to handling high-value goods. The same applies to items such as perishable goods and pharmaceuticals. “If we can prove the provenance at any of the touchpoints along the way using a blockchain, especially a standards-based blockchain, it gives us even more confidence,” Carter said. Being able to prove the provenance and proper handling is a key factor in logistics, especially as logistics moves to more of a consumer model. “Businesses want goods to move fast, fast, fast, fast,” Carter said. “They want Amazon Prime-type delivery on some pretty expensive, complex goods. And being able to have that verification [throughout the supply chain] is really critical.”
The biggest benefit of using blockchain in supply chain logistics is transparency, said Andy Stinnes, a venture partner at Cloud Apps Capital Partners in San Francisco. Transportation logistics is the one area of the supply chain where the complexity of having to deal with and coordinate across many partners is particularly evident. The value proposition for blockchain in supply chain logistics is the ease of information exchange, Stinnes said. Getting an accessible and consistent view of data is difficult, Stinnes points out. Blockchain is meant to solve that problem. “So this is why everybody is so excited about blockchain in supply chain in general and transportation logistics in particular.”
[Businesses] want Amazon Prime-type delivery on some pretty expensive, complex goods. Using blockchain in supply chain logistics allows all the authorized participants in a transaction to access critical data to validate the milestones of that transaction, Carter said. “For example, you have a repair depot and you’re getting spare parts supplied to you and you’re doing repairs for some critical device,” he said. “You’re able to ensure that the repair has been validated, tested, and maybe you include the test results at the repair facility in a public blockchain or a supplier blockchain.
