Up to this point, it is agreeable that the sheer amount of disruption that Blockchain is poised to cause in the logistics industry is massive. From validating provenance along the supply chain to creating transparency, the benefits are perfectly timed for the current ‘Amazon effect.’ It gets even better when you consider the fact that its arrival is a win-win for everyone in the chain.
With Blockchain, customers get what they want, when they need and in the exact same condition. The head of the tech giant, IBM, Ginni Rometty is, in fact, upbeat that this technology might earn the sector a whopping $100 billion on efficiencies.
Blockchain and Supply Chain Management
The current supply chain market is worth over $85.7 million. Experts predict an incredible 80.4% CAGR growth by 2024 to hit $2,674.9 million, especially once Blockchain use is standardized.
Such a massive growth would ideally translate to partial-to-total elimination of all the common challenges bedevilling the industry. Lack of transparency will be a thing of the past, similar to counterfeiting, and the current inability to easily ‘track and trace’ commodities. Basically, all the players will have achieved a majority of the potential benefits of blockchain in supply chain logistics.
To best understand this, you just have to look at the amount it would save all stakeholders. With this technology, arguably the $1.2 trillion counterfeit goods will be erased off the chain. And that simply means, among other benefits, the over a million lives lost annually from counterfeit drugs will significantly reduce.
Still, every single product on transit, especially the perishables and pharmaceuticals, will arrive safely and dent-free. Products will also be shipped quickly, ensuring that traders never suffer losses due to delays on the road.
Blockchain alone isn’t enough to bring the efficiency the industry direly needs
The essence of Blockchain is the whole matrix is what’s known as ‘Smart Contracts.’ Every participant in the Blockchain-powered ecosystem will be actively involved in shipping the product, by merely using these Smart Contracts.
But even with this decentralized ledger unifying all participants in the chain, it would only be after the integration of the Internet of Things that the industry achieves optimum benefits. IoT, like Blockchain, is the magic that the global supply chain is in a dire need of.
IoT is best suited for the logistics sector because it not only complements the use of Blockchain but also packs a punch in transforming supply chain management. It is great for agility, transparency, and adaptability and comes in handy in tracking and tracing commodities.
It has what it takes to authenticate the exact location of goods at any time, track real-time speed of movement and the traffic flow and even monitor stock. IoT also makes it breezy to locate goods in the distribution center and even identify where problematic commodities originated from.
Special RFID-tagged containers transmit data that are picked up by GPS satellites. Shipping companies only need to keep an eye on the special computers receiving the data to track the shipment and their general condition.
Everything is simple, transparent, and streamlined. The sector no longer finds it hard to reassure their clients on the state and location of their commodities. Already and as evidenced by the leading brands led by AeoLogic, and the benefits realized so far, the Internet of Things is revolutionizing the sector.