How can Blockchain Help in Improving the Current Scenario?
- Transparency and Traceability: Blockchain enables establishing a clear and permanent record of any transactions and movements of goods across the supply chain for all the members to see and verify. This increases trust as well as the level of accountability, especially in areas such as fake products as well as alterations of records without proper authority.
- Supply Chain Visibility: With the help of the blockchain approach that uses distributed registers, several parties embodied in the supply chain can receive the opportunity to track the movement of materials and goods and their parts at different stages of logistics. This way, there is an opportunity to act earlier and make necessary decisions for the business, decrease the likelihood of unexpected breaks, and introduce better working processes.
- Streamlined Documentation and Compliance: Literally, the job of documenting, verifying, and sharing invoices, contracts, and certificates of origin among other documents can be done through a blockchain. This eliminates writing down results manually, avoids incorrect calculations, and makes it easier to adhere to laws and ordinances.
- Enhanced Security and Fraud Prevention: People also know that as per the blockchain creation concept, data recorded on the blockchain cannot be edited or wiped out, and there is no possibility of tampering by anyone without the consent of other participants. This serves as the best practice to reduce fraudulence, compromise, and unauthorized entry into the information related to the supply chain which in turn increases the level of securities in the supply chain transactions.
- Efficient Inventory Management: It can also enhance stock control in that it can offer real-time data about the location, status, and ownership of stock goods. This minimizes incidences of stock out and overstocking of products hence reducing cost and shareholders’ returns while satisfactorily meeting the customers’ needs.
- Supply Chain Financing: Blockchain-based supply chain finance solutions have the potential to allow organizations to navigate the supply chain more securely and give sellers and buyers access to better financing based on their supply chain transactions. This way, blockchain can bring down lenders’ risk and make financing more beneficial for suppliers by making financing a more digital and automated effort.
- Sustainability and Ethical Sourcing: The technological possibility issued from the application of blockchain is to regenerate, in a punctual and public way, the notion of a supply chain and allow consuming practices based on the sustainable and ethical sourcing of raw materials and goods. This makes it easier for companies and organizations to source materials, goods, and services with less compromise to the environment or social fabric.
Blockchain for Supply Chains
Blockchain has become identified as one of the major disruptive technologies that hold great potential in the supply chain area. Historically, supply chain management has always faced several challenges such as; opacity, and weak supply chain controls to mention but a few. Blockchain, which is a distributed digital record system that is secured through cryptography, is well-equipped to handle many of these issues. Given that blockchain preserves information and transactions in an easily accessible and immutable form, this technology can strengthen trust with various parties, facilitate processing, and improve the supply chain.
Table of Content
- Current Supply Chain Scenario
- How can Blockchain Help in Improving the Current Scenario?
- Potential Benefits of Using Blockchain in Supply Chain
- Key Challenges for Using Blockchain in Supply Chain
- Case Studies Related to Blockchain in Supply Chain
- Conclusion
- FAQs