TechDogs-"Building Consumer Trust In Supply Chains With Blockchain"

Blockchain

Building Consumer Trust In Supply Chains With Blockchain

By TechDogs

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Overview

Do you remember the Marauder's Map from Harry Potter? It was a magical map that revealed the exact location and movement of every person within Hogwarts - from classrooms and hallways to the secret passages within the castle. This document allowed its owner to track every person, in real time, portrayed by a dot on the map. Well, we bet every business professional has wished for something similar at some point in time! #MindReaders

We mean, businesses often need systems that can identify and scrutinize every move within their ecosystem. That is where the magical blockchain technology steps in!

It is a decentralized, immutable ledger that records transactions (locations) and tracks assets (wizards and witches) within a business network (Hogwarts). This delivers unrivaled traceability, especially for industries with a high volume of movement, such as supply chains. Just think of each transaction being as easy to track as a dot on the Marauder’s Map, making a product's journey from the factory to the end-user easy to trace.

Just as Harry relied on the magical Marauder's Map to navigate Hogwarts effectively, businesses must depend on blockchain to enhance the supply chain's traceability and transparency to boost consumer trust. So, say abracadabra and read on!
TechDogs-"Trace The Red Flags In Your Supply Chain!"-"Building Consumer Trust In Supply Chains With Blockchain"
We bet you already know that visibility has remained a major challenge in supply chains, as it involves tracking complex transactions and the movement of goods. Supply chain companies are engaged in thousands of transactions across a vast network of partners, delivering thousands of products every day. Yet did you know that the same technology behind cryptocurrencies can provide the answer to this challenge?

Well, blockchain has the potential to improve the performance of supply chains by enabling faster, more cost-efficient and seamless delivery of products. Moreover, it can enhance the traceability and transparency between various stakeholders and partners in the process. In fact, IBM Food Trust has helped wholesale seafood supplier Raw Seafoods increase consumer trust by tracking catch right from the oceans to supermarkets using blockchain technology.

Well, before we understand the critical role of blockchain in supply chains, let’s understand blockchain in detail!
 

What Is Blockchain Technology?


Blockchain essentially refers to a distributed ledger that stores information, allowing all the network participants to access the ledger and its immutable record of transactions. Whenever a transaction occurs, for instance, the movement of a product from the warehouse to shipping, a “block” of data records the relevant information. This often includes who, what, when, where, how much, etc. to ensure full transparency and visibility. When the next transaction occurs, for instance, the item being delivered to the consumer, another “block” of data is created to record the information.

Since these “blocks” of immutable data form a secure “chain” (the name makes sense now, right?) as the asset moves from one location to the next, it prevents any block and its data from being altered or added. This is how a blockchain works in principle to ensure decentralized and secure storage of data.

Now, let’s take a walk and see how this applies to supply chains!
   

Role Of Blockchain In Supply Chain


When you think of a global supply chain, it is critical to remember that it consists of a network of interlinked businesses – from manufacturers and vendors to transport and warehousing. Each business is expected to perform a service or action before the product reaches the end user to enable a successful supply chain pipeline.


Now, a blockchain can enable each business to record a transaction on the shared, immutable ledger, improving the validation of data across interlinked companies. Since all businesses have access to a single source of truth, it provides higher transparency and traceability, which can boost global supply chains.

Track and trace, a term commonly used in the supply chain industry for the ability to identify the past and present locations of products, has been a constant challenge. Today, all the involved stakeholders can record and access individual supply chain transactions directly via a blockchain network. Since every participant has access to the same shared ledger of transactions, businesses have complete visibility over the process, leading to higher productivity, resilience and collaboration.

That sounds magical – but how does this help the global supply chain?


How Blockchain Builds Consumer Trust In Supply Chains


You know now that deploying blockchain solutions can improve visibility and transparency across the supply chain pipeline. This leads to higher consumer trust in several ways, including:
 

  • Enhanced Traceability

    Did you know that the U.S. Drug Supply Chain Security Act of 2013 requires pharmaceutical companies to track their inventory of prescription drugs to protect consumers from counterfeit products? After this landmark act, drug inventory is tagged using electronic product codes based on GS1 standards and each unit of inventory is recorded on the blockchain. This allows supply chain and pharmaceutical stakeholders to create a detailed history for each item throughout the supply chain pipeline — from the pharmaceutical research lab to the end consumer.

  •  Fewer Disruptions 

    What’s worse than getting an “Order Delayed” notification on your online shopping app? After all, businesses in the supply chain deal with thousands of transactions across dozens of suppliers, customers and locations every single day. This often leads to unpredictable lead times and a lack of visibility regarding the movement of goods. However, when all the supply chain participants share their inventory and schedule flows via a blockchain network, it allows others to make decisions using complete and real-time information. This enhances the customer experience as stakeholders can synchronize their logistics data to ensure shipments are delivered seamlessly.

  • Detecting Counterfeit

    ProductsBy linking inventory information and supply chain workflows across stakeholders, a blockchain solution enables participants to reconcile purchase orders, invoices and payments more easily. This allows each participant to track and verify the progress of goods with counterparties, reducing the chances of counterfeit goods being introduced within the supply chain pipeline at any point. Moreover, this allows any counterfeit products detected to be traced to their source using the blockchain trail. Furthermore, supply chain businesses can leverage self-executing smart contracts to automate audit trails and product reconciliations.

 
We’re glad you liked it, Harry!

Yet, these are only some of the ways in which blockchain can enhance the traceability, visibility, quality and resilience of supply chains, leading to a better experience for consumers. Naturally, the outcome is a more seamless supply chain performance that consumers trust!
 

Conclusion


You see now Harry, by implementing a blockchain-based solution, supply chain businesses can effectively digitize the tracking of their physical assets. This enables the creation of a decentralized, immutable record of all transactions that’s accessible to all participants. This end-to-end visibility is critical in enhancing the efficiency of global supply chains and boosting the consumer’s trust.

Frequently Asked Questions

What Is The Role Of Blockchain In Supply Chain Management?


Blockchain technology plays a crucial role in supply chain management by providing a decentralized and immutable ledger for recording transactions. Each participant in the supply chain can record their transactions on this shared ledger, ensuring transparency and traceability across the network. This enhances the validation of data and improves collaboration among interlinked businesses, ultimately leading to a more efficient supply chain pipeline.

How Does Blockchain Technology Enhance Consumer Trust In Supply Chains?


Blockchain technology enhances consumer trust in supply chains by improving visibility and transparency. It enables enhanced traceability of products, allowing consumers to track the entire journey of an item from its origin to its final destination. This transparency helps in reducing disruptions, as stakeholders can access real-time information about inventory and schedule flows, leading to seamless deliveries. Additionally, blockchain facilitates the detection of counterfeit products by providing a secure and auditable trail of transactions, thus ensuring the authenticity of goods.

What Are The Benefits Of Blockchain Technology For Supply Chain Stakeholders?


Blockchain technology offers several benefits for supply chain stakeholders, including increased transparency, traceability, and efficiency. By leveraging blockchain, stakeholders can streamline processes, reduce administrative burdens, and mitigate risks such as counterfeit products and supply chain disruptions. Furthermore, blockchain enables the automation of audit trails and product reconciliations through smart contracts, enhancing operational efficiency and trust among all parties involved in the supply chain ecosystem.

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Blockchain Traceability Blockchain Supply Chain Blockchain In Supply Chain Blockchain Traceability Supply Chain Benefits Of Blockchain In Supply Chain

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