Implying enterprise blockchain applications in the supply chain can help increase trade volume by 15% and the US GDP by up to 5%.
Comprehensive research by Market Research Future Reports (MRFR) recorded that the worldwide blockchain in supply chain market reaches value from USD 81.40 million in 2017 to USD 3,485.25 million, prospering at a CAGR of 87.0% during 2018 and 2023. Especially with the impact of pandemic COVID-19, the needs for developed security and transparency in supply chain management to control transaction flow is rising drastically. Enterprise blockchain applications are no longer here to stay in supply chain industries.
Main purposes that make supply chain companies are approaching blockchain for their business.
- End-users demand for transparency is rising while companies are more open to sharing data with partners and even competitors. The development of a solution that allows sharing data safely and effectively to create transparency is inevitable. Blockchain can help enterprises to gain transparency while ensuring the security and privacy of the business to protect sensitive data and enhancing trust between parties.
- Supply chain companies understand that cutting off intermediaries in the whole process helps them much in controlling effectiveness and costs. By storing data on the digital environment with high security of the cryptographic algorithm, blockchain helps to cut down processing time and paperwork. For instance, according to Barclays bank, blockchain can shorten transaction times from 7-10 days to less than four hours, by eliminating intermediaries inherent in traditional systems.
- Fraud and counterfeiting are also concerns for many supply chain companies. Because they disturb business activities, affect firms’ reputation and directly affect consumers. Because data on a blockchain database is immutable, blockchain can prove the accuracy and uniqueness of products.
- As the global economy becomes flatter, cooperation between companies from different geographic regions is increasing. Storing on a distributed ledger system like blockchain allows parties to access in necessary data quickly and reliably from any location as permissioned.
Based on those main benefits, enterprises are investing in blockchain solutions to prepare for a new disruptive phase.
Top enterprise blockchain applications in supply chain use cases:
Blockchain traceability solutions are implemented in different ways including risk & compliance management, payment & settlement, smart contracts, counterfeit detection, product traceability solution, and others.
Here are some particular use cases that work and show real benefits.
Blockchain food traceability
Pesticide abuse in the cultivation and harvesting on many farms is raising consumers’ interest in food origin and the information of what they eat.
Blockchain improves the effectiveness of providing transparency information of food origin and parameters. On the other hand, it helps to decrease processing and shipping time to end-users, which ensures food quality.
Walmart, as a pioneer in the domain, invested $25 million in a food traceability system that allows the retailer to track incoming food supplies from “farm to store” and control foodborne poisoning and minimise costly food recalls/loss. The firm has achieved great results with its blockchain system. For instance, time for tracking mango products in the Americas reduces from 7 days to 2.2 seconds.
Blockchain in the automotive industry
Automotive companies can use blockchain for multi-group purposes, such as verification and process improvements; vehicle management and incentives; Finance, payments and insurance.
Exploring blockchain and distributed ledger technology for use in the development of driverless cars, Toyota has been harnessing blockchain in three areas: Driving/Testing Data Sharing; Car/Ride Share Transactions; Usage-Based Insurance.
According to Deloitte, as specific as its insurance solution, insurance firms can create personalised vehicle insurance contracts based on actual driving behaviour and automate the payment of insurance claims. Information of behaviour events (speeding, mileage) and safety events (damaged parts, collisions) of the vehicle stored on a blockchain can be shared and used to calculate insurance premiums and payments.
Blockchain pharmaceutical tracking
According to the World Health Organization, one in 10 medical products — including pills, vaccines, and diagnostic kits — are substandard or falsified in low- and middle- income countries. Besides, the process of researching new drugs, putting drugs into practical use, and withdrawing drugs is very time-consuming, expensive, and requires a variety of other legal validations.
With blockchain, the information in researching can be shared for the research and development of new products without being compromised. The line between benefit and competition is gradually fading, drugs are brought to the market faster, with lower cost.
MediLedger combines blockchain with RFID and NFC in its decentralized network for the pharmaceutical industry. Their solution allows companies in the system to request and respond to product identifier verification requests. As a result, tracking every single drug box to ensure it is in the right location is getting more manageable, and the recall process ensures the recalled product is correct.
Blockchain is still immature compared to its full potential business value. With built-in SDKs, akaChain provides a suite of traceability, payment and data sharing solutions based on blockchain that quickly integrate into existing supply chain systems of many businesses.
akaChain is backed by FPT Software, a globally leading technology, and IT services provider. It is an end-to-end, permissioned, multi-chain network based on the Hyperledger Fabric. Since Establishment in September 2018, akaChain’s product has assisted many enterprises, from SMEs to Fortune 500 firms, to transform with distributed ledger technology. The company provides a broad range of permissioned blockchain-based products and services in multiple sectors, including retail, supply chain, banking and finance, insurance, shopping mall management, etc. to transform with its distributed ledger technology. For more information, please visit https://blog.akachain.io/.
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