How Blockchain can help to boost the Logistics Industry

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Blockchain has changed the way of conducting the most complex and essential commercial exchanges in the logistics sector. To begin with, we want to mention the total control you will have over each supply chain link. In addition, the use of Blockchain makes it possible to considerably reduce the costs related to logistics and transport. At the same time, your business also benefits from better profitability besides optimizing your services. Many logistics software development companies are now adopting the blockchain technology to provide unique and connected solutions to their customers.

We share the benefits of using blockchain technology in logistics and supply chain.

 

Advantages of Blockchain in the Logistics Industry

Blockchain technology can be used in various logistics processes, from supply to delivery, including inventory management—a review of its contributions from one logistics phase to another.

 

Optimization of Information

On the Blockchain, all information related to a product, from the raw materials used for its production to the inventory, is stored and accessible to whomsoever it may concern.

Companies can store  a large amount of information immediately accessible to the concerned supply chain phases. The Blockchain thus allows rapid circulation and fluid data sharing between users. In doing so, errors and repetitions, sources of waste, and lack of productivity are primarily avoided because all logistics levels are informed in real-time.

 

Verification and Security

Owing to the mining and verification process of the Blockchain, the information shared on the network is certified authentic. In addition, data is secure and cannot be modified or falsified. Thus, users have access to reliable information. As a result, there is increased transparency in the supply chain , leading to improved trust  between logistics players.

 

Data processing speed

Based on the principle of data sharing, Blockchain promotes decentralization and autonomy in managing logistics processes.

It offers users access to the same information simultaneously. Therefore, the decision-making and the data processing are fast at all logistical levels, which avoids the loss of time, among other things, caused by the centralized management of information.

 

Secure Transactions

In today's logistics ecosystem, transactions between two parties are done through a third-party intermediary whose leading role is ensuring  reliability and trust. For example, most online financial transactions are conducted through PayPal, Moneybookers, or other intermediaries, which act as a depository for people sending and receiving money.

Businesses can now effectively eliminate the middleman or portal business in the process. Blockchain's peer-to-peer network enables self-executing contracts, facilitating customer payments and eliminating the middleman. The net result is resolving the problem of control of the origin of the goods and the components of these products, the piracy of the products, and much more of the logistics industry.

 

Shipping optimization

In terms of shipping, the Blockchain allows companies to ensure the traceability of products from production units to delivery to the end consumer. Furthermore, when product information is published on the Blockchain, it can be viewed in real-time by company supply chain agents and customers.

This shared access to data related to the products' journey makes it possible to anticipate all possible malfunctions, resolve them on an ad-hoc basis, and locate responsibilities. Thus, in the event of counterfeiting, theft, health alert, or any other major alert, companies can quickly identify the affected products and target returns and awareness campaigns.

For customers, the Blockchain makes it possible to identify and follow the circuit traveled by their purchases from start to finish with the help of a tracking number. It is also a way to precisely know a product's origin, composition, delivery conditions, etc.

Blockchain helps the company meet traceability requirements, avoid problems that may arise during the shipment of products, and solve them more efficiently, if necessary.

 

Better use of labor

Combined with traditional tools for optimizing and automating the supply chain, Blockchain helps the company better manage the personnel responsible for the various tasks during the logistics phases. It makes it possible, for example, to dispense with the labor involved in handling paper documents since everything is shared virtually via a smart contract.

The company can thus reduce its workforce and payroll or, failing that, assign staff tasks with high value requiring human intervention.

 

Visibility of the distribution chain

For users in the distribution chain, the Blockchain is a real help in controlling the processes related to this logistics phase. In this case, it allows the distributor to have greater visibility of the parties involved in its chain and a better knowledge of the products to be sold, particularly in terms of quality. This has a significant advantage in terms of customer satisfaction.

 

Increased security in data transfer

One feature that makes Blockchain so popular is security. This makes it possible to protect the data better and to provide them with more reliability through strict verification. Also, data and information flow within the supply chain will be more reliable and secure. Not to mention that the Blockchain can structure this data and make it easier to consult, saving more time.

 

Improved supply reliability

Blockchain can also bring about supply-level changes, making it possible to make products unique and readily identifiable through its identification and traceability function. Thus, the company can quickly verify the origin, quality, and conformity of materials and products .

 

Better transparency 

Transparency is one of the main challenges facing the supply chain industry, hence the need to introduce  supply chain management) and logistics management tools. Nevertheless, the lack of time prevents the timely analysis of certain information. Thus, the process flow of information and data presented by the stakeholders and circulating within this system is only sometimes precise and reliable.

The Blockchain allows for harmonizing data within the supply chain and establishes a climate of trust between the company, suppliers, and consumers. In addition to offering considerable time savings, the company can reduce costs by eliminating intermediate processes within the system. This cost reduction can extend to the different types of freight transport, for example, by facilitating the verification phase of product information.

 

Wrapping Up

Blockchain technology not only offers new possibilities for secure data storage, but it also has the potential to replace previous business models and change the game overnight completely. So the question is not whether an enterprise should use Blockchain but when to start using it. The list of blockchain services and new applications is growing almost daily. For the logistics industry in particular, this means being vigilant to take advantage of the bandwagon and getting a head start in Blockchain.

The decision for a logistics business to engage with a logistics software development company is crucial. This means your business is growing and will continue to do so. Therefore, considering the benefits of investing in a logistics software provider is essential because they can help you earn a significant return over time.

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