Unlocking the value of blockchain in the logistics industry
For most of logistics industry-related professionals, the technology of blockchain is no more than a buzzword since its applications can be obscure and difficult to understand. But, in reality, the blockchain technology is a new way of managing data. The impact of blockchain is pretty obvious in every industry. Today, it is being implemented industrywide. And the logistics industry is not an exception.
Yes, you have read this correctly - the blockchain technology is not only about Bitcoins. Wondering how blockchain can streamline the logistics industry? Let’s try to figure that out.
But before anything else, let’s examine the current problems the logistics industry faces. We will also review the logistics technology ecosystem and highlight the key emerging trends.
The logistics industry and the key problems it faces
So, what do the logistics feature? The logistics industry includes services offerings in a number of areas, including warehousing, international/freight forwarding, fulfillment, packaging, and pick & pack, full truckload (TL), intermodal, air, and ocean, as well as small parcel/package. Apart from the mentioned above, technology, software and outsourcing solutions that people buy to manage their logistics also belong to the logistics services.
When it comes to the major problems the logistics industry faces, we have to say that all logistics-related businesses suffer from clumsy infrastructure and bureaucracy.
- Huge timing. Due to globalization, payments between the involved parties (vendors, suppliers, and customers) might take several days to get processed while contracts being reviewed by bankers and lawyers comes with extra cost and delays.
- Big costs. Growing fuel prices increased wages, and peaking inflation indexes all work in tandem to increase transportation costs daily.
- Lack of transparency. Today, it’s incredibly difficult for customers or buyers to truly know the value of products because there is a significant lack of transparency in our current system.
- Numerous figures and a lot of data. Indeed, people working in the logistics industry have found it rather tough to coordinate smooth discharge of operations since they have to deal with a lot of figures and data on a daily basis. Thus, it’s of vital importance to keep all of the data in real time.
- Trade disputes. Sometimes, it’s difficult to find the guilty one if any logistics industry business issues occur. As a result, an organization has to spend lots of time on issue investigating to find who was that guilty one.
Not surprisingly, with all of the pitfalls the business owners, brokers and other people working in the logistics industry face it might be rather complicated to stay ahead of the competitors. So, any solutions? Take use of blockchain data!
The value the blockchain can bring for logistics
The blockchain is a record-keeping system that makes it easier and safer for businesses to work together over the internet. It provides a scalable, immediate solution for order tracking and authentication. Plus, the technology of blockchain promises to solve all of the logistics industry issues we have mentioned above and moreover, it has the potential to make all of the business processes absolutely trouble-free. Already intrigued, right? Let’s spread some light on how blockchain can transform the logistics industry.
In fact, blockchain for logistics can bring numerous capabilities, including the following ones:
- Streamline and integrate all business processes and transactions. Just for the record, blockchain let’s transfer of funds anywhere in the world without the use of a traditional bank. Plus, it can make it easier to link physical goods to serial numbers, barcodes, digital tags like RFID, etc.
- Automate all common activities and delivers zero hard-copy paperwork. So, the blockchain technology makes it possible to automate numerous activities and smart contracts will also improve the transaction flow and security in the supply chain. Therefore, it seriously enhances freight auditing and invoice management.
- Reconcile issues. Blockchain can enrich practically every industry related to logistics. Blockchain with its decentralized database system can be used for any exchange, agreements/contracts, tracking and, of course, payment. The use of IoT technology can take things even further.
- Increase transparency. Blockchains create visibility and traceability. There is no dispute in the chain regarding transactions because all entities on the chain have the same version of the ledger. And thus, the use of counterfeit products is extremely eliminated.
- Reduce errors. Due to smart contracts, blockchain ensures your transaction remains stress-free, reducing the possibility of errors and decreasing the amount of frauds and cargo theft.
- Cut down the expenses. Blockchain makes it possible to solidly cut down the costs for the massive supply chain industry as it eliminates the need in middlemen.
- Stay in the know and gain full control over your business. Due to blockchain-integrated capabilities, you might be able to trace the whereabouts of products and identify who owns it at the moment and what our next steps should be on this path. Moreover, users can also trace the history.
- Act when action is needed. Picture this: a crypto-anchor can be equipped with a temperature sensor for cooled/frozen goods tracking purposes or a GPS sensor that alerts unauthorized package openings. This information is recorded on the blockchain. And thus, once something happens, you know when to act.
- Maintain Accuracy of rates. Due to smart contracts, blockchain ensures the accuracy on rates. Thus, people won’t be able to take extra money or perform the so-called “grey affairs”.
- Improve security. Being cryptographically protected and decentralized, the blockchain technology makes it possible to better protect shipping, possession, and ownership of data from tampering or hacks.
- Maintain strong customer relationships and post-purchase engagements Blockchain technology along with smart contracts help deals run smooth and tackle the challenges of tomorrow’s freight audit. So, why not strengthen relationships across the supply chain then?
In a nutshell, the impact of blockchain on the logistics industry is pretty solid. Implementing blockchain technology in the supply chain and logistics industry brings a relief to many problems in terms of cargo insurance, currency risk, liability for goods damaged during transportation and so on. Not only that blockchain enhances freight auditing and invoice management, but it can help you flourish your online business as the products are getting to the customer faster and prices can be managed better when processes result in lower transportation costs and fewer man hours.
Now that you know about the numerous advantages blockchain can bring to the logistics market, the only one thing that is left is the question you might start asking yourself, “So, what now? How to integrate the blockchain technology into your business solution?”
And the answer is pretty obvious - all you need to do is to find a reliable vendor who can integrate the blockchain technology into your logistics supply chain management solution. By the way, Atrelogic, a trustworthy forward-thinking blockchain solution development vendor who values transparency and innovation, and understands blockchain’s potential. We are going above and beyond in all of the logistics-related areas and stand to be a big winner in logistics. And thus, Artelogic is there to provide you with A-level blockchain solutions that will help you stay on top of new advances in business processes. So, it’s time to unlock all opportunities blockchain-integrated software solutions have to offer.