A blockchain is a digital ledger of transactions distributed and duplicated across all the computers on the blockchain network. Although blockchains have diverse applications in many fields, their use in supply chains is becoming more significant by the day.
As a professional working in the supply chain or any relevant field, it is essential to know and understand how blockchains will change the future of the supply chain so that you can pursue new career tracks that are going to be made in the future. Here are some ways blockchain is contributing to supply chain improvement:
A blockchain supply chain can enable users to record price, location, date, certification, quality, and other relevant information to effectively manage the supply chain. The availability of this data within the blockchain helps to increase traceability of the material supply chain, lower the losses from counterfeit markets, increase visibility and compliance over outsourced contract manufacturing, and potentially augment a company’s position as a leader in the supply chain.
2. Smart Contracts
When many parties are involved in the service delivery of sensitive products like healthcare logistics, time is the most critical variable. Usually, it takes a long time to exchange paperwork, revise and ensure compliance with the agreements before signing the documents.
With a blockchain, all changes and transactions are transparent and shared with every participant. A private blockchain can be used to sign contracts quickly because there is increased transparency and less paperwork. Once the contracts are signed, the implementation phase starts immediately, saving precious time and valuable medical goods whose shelf lives are short or require expensive warehousing services.
3. Third-Party Financial Services
Blockchain is a technology that is removing barriers and bringing clients and providers closer. It eliminates the need for third-party services that manage financial transactions. The entities take a lot of time to move contracts because of their own regulations and thus increase the lead times of highly time-sensitive orders.
When blockchain is used to share all information, there is no need to engage a financial transaction service entity. It also reduces information leakage as no external party is now involved in any transaction, and the company’s transaction and agreement information are safer.
In today’s world, reputation is a precious asset. Even in B-B markets, a company’s image is vital to secure contracts in the long run.
Blockchain’s transparent process of sharing all information with all participants means no possibility of foul play in any financial transaction by any member of the blockchain network.
FET Logistics is currently up to date with its latest tracking technologies and on-call customer dealing services. It has enabled the company to lead the industry in the category of dangerous goods, cold chains and healthcare logistics in the UK. Yet, there is a lot to improve. Only such companies with a policy to regularly upgrade themselves with the most modern technologies will maintain their corporate reputation.
5. Credibility And Public Trust
Since blockchain members can access all information and history of transactions, a company using blockchain in services will have transparency of all transactions. It means that anyone can see how much a company charged, how they delivered and how much the company made as to the bottom line profit.
This benefit of blockchain builds the credibility and trust of the general public along with all its stakeholders. Such a credible organisation is bound to improve its net worth in the stock market because investors and the public prefer to put their money in companies with a clean financial history.
One of the most significant benefits of blockchain is democratising the supply chain and other business functions, breaking the barriers for clean companies to share their performance with the world. Companies like FET Logistics, which are family-owned companies, are likely to take advantage of a transparent system like blockchain to show their quality work and gain the customers’ trust and loyalty. Hence, customers are likely to choose companies that deliver rather than companies with a brand name.