The supply chain industry is rapidly surfacing, and global transparency has become core business solicitousness. Traditional methods, such as tracking a shipment through manual paper trails, intricate paperwork, manually controlled ledgers, etc., are no longer sufficient in today’s tech-driven world.

Enter blockchain technology – the buzzword that promises to revolutionize supply chain management by providing an immutable ledger that easily tracks assets across borders.

But is blockchain truly a cost-effective solution for achieving an indefectible global supply chain? Let’s delve into this intriguing question in the writing that follows:

Blockchain for Supply Chain Management- A Bliss or Woe?

The collective supply chain is quite hard to track and trace from end to end. With so many different and independent players involved in getting every package to its destination, the challenges of the supply chain surge higher. The road to a perfect supply chain gets even more challenging when we realize that modern-day customer demands better visibility, uninterrupted traceability, impeccable transparency, and accurate sustainability regarding parcel movements.

The Blockchain can ascertain that critical products are delivered within all these key parameters. Besides Cryptocurrency contributions, Blockchain technology could make supply chain management more efficient, transactions more transparent, and shipment handling more affordable through decentralized universal income. You may wonder if this asset of the Blockchain is worth holding onto for the years to come. The answer is yes.

Here are a few ways Blockchain can lead to a better future with simplified supply chains for key industry players:

• It makes the entire supply chain inter-dependent where multiple stakeholders can be involved
• Worldwide logistics will be leveraged
• It synchronizes supply and demand
• It enables the use of various sizes of materials
• Sub-contractors can be introduced into the supply chain
• Varying processes, business practices of HR, and sustainability are taken care of

Source- https://litslink.com/blog/blockchain-in-supply-chain-management

How Blockchain Drives Cost Cutting in Supply Chain Management

Most of the businesses in the Gulf still heavily rely on using ERP and supply chain management software. While such investments in digital infrastructures have paved the way to good results, the blockchain opens up a new paradigm shift for supply chain management.

There are three ways blockchain can offer cost-savings for supply chain management.

1.   Blockchain Technology Redefines Supply Chain Intermediaries

Part ways with expensive intermediaries! With blockchain, supply chain businesses can collaborate and agree on critical information without the need for costly facilitators. Blockchains’ synchronized and verifiable nature allows for seamless peer-to-peer contract negotiations, eliminating the burden of centralized intermediaries and their hefty fees.

2. Unlock Procurement Discounts with Blockchain Efficiency

Managing procurement discounts becomes effortless with blockchain. Imagine the challenge of tracking purchases across business partners, subsidiaries, and supply chain entities. Blockchains simplify this complex process by maintaining a constantly updated digital ledger. Real-time data collection enables businesses to monitor total purchase volume accurately, harnessing the full potential of procurement discounts. No more expensive auditors—blockchain-powered intelligent contracts do the work at a fraction of the cost.

3. Empower Inventory Management with Precise Forecasting

Bid farewell to excessive inventory! Traditionally, businesses stock up on extra inventory due to uncertainty in demand. However, capital costs and rapid depreciation make this approach anything but cheap. Enter blockchain, the ultimate resource manager. With their precise tracking capabilities, blockchains optimize resource allocation and ecosystem-level management. Enhanced accuracy and forecasting minimize the need for excess inventory, freeing up capital and driving substantial cost savings.

Blockchain’s Role in Elevating Supply Chain Traceability

In the interconnected world of supply chains, traceability acts as a thread that weaves together stakeholders, processes, and data, creating a cohesive tapestry of visibility and control. This makes supply chain traceability one of the top use cases for the mighty Blockchain technology. If stats are to be believed, replacing traditional processes with the Blockchain’s distributed ledger technology can lead to a substantial 15% increase in trade volume. The Blockchain allows tracking of any digital or physical product throughout its lifecycle. The distributed ledger module carries the potential to expand the sustainable as well as the ethical production and consumption of any commodity.

Blockchain Unveils the Key to Transparent Supply Chains

Transparency in supply chains is crucial as industries often rely on third-party manufacturers and products from multiple vendors, leading to the creation and labeling of final finished goods. This process can involve selling and relabeling white-label products under different brands. Producers gain a comprehensive view of their value chain by implementing traceability measures, ensuring the smooth transfer of third-party goods and accurate final product labeling.

Blockchain technology is pivotal in tracking assets and maintaining records throughout their progression. Through smart contracts on the Ethereum blockchain, asset tracking processes are enforced, allowing anyone to access real-time information about the provenance and journey of physical and digital assets.

Blockchain’s impact on regulatory compliance and reporting is particularly significant in the pharmaceutical industry. With patients relying on prescription drugs, it is crucial to maintain an efficient supply chain without experiencing under or overstocked medications. By automating compliance and reporting activities, blockchain technology reduces friction, reporting costs, and errors associated with manual processes. Real-time information provided by blockchain enhances corporate governance by seamlessly distributing data to relevant stakeholders. Additionally, blockchain can improve compliance and reporting across various domains, including medical devices, prescriptions, manufacturers, and other consumer goods.

Discussing the Potential of Blockchain in Improving Supply Chain Management- Stats and Food for Thought

A recent report by the WEF or World Economic Forum estimates that by 2027, around 10% of the entire global GDP will be stored on blockchains or blockchain-related technologies [1]. Another report reveals how blockchain could help reduce infrastructure costs by up to 30% [2]. This would significantly save businesses, particularly those with complex supply chains.

WEF’s report isn’t the only one to suggest that blockchain can potentially transform supply chains. A study by IBM found that 16% of respondents considered using blockchain in their supply chain management processes[3], while Gartner predicts that by 2023, one in four organizations will be using blockchain services in their business [4].

So why is there such a level of interest in using blockchain for supply chain management? One of the main reasons is its potential to improve transparency throughout the whole process. At present, there are numerous touchpoints and handovers between different parties involved in a typical supply chain – right from suppliers and manufacturers to distributors and retailers. This can make it strenuous to track goods and ensure everyone involved is working efficiently.

With blockchain, however, each process stage could be recorded on a decentralized ledger. This would provide full visibility of the product throughout its life cycle.

How Does Blockchain Drive Values in The Supply Chain

The Future Can Be Better

As Blockchain technology gains momentum, enterprises will feel the need to observe the players in the industry who have already begun experimenting with this approach. We all know how blockchain benefits from a network effect. Once a critical mass gathers in the supply chain, it will be a sinecure for others to jump on the board and leverage the benefits.

To sum it up, the revolution is not just a myth. The era of modernizing supply chains is not in the future; it’s happening right now, in the present. And if you haven’t joined the race yet, you are missing a significant opportunity to enhance your business. It’s high time you start analyzing the options to develop a blockchain prototype for your own supply chain management.

Blockchain technology holds immense promise for cost-saving transformations in supply chain management. Be an early adopter and reap the multitude of benefits this revolutionary solution brings. Prepare for a supply chain landscape where inefficiencies are eliminated, discounts are maximized, and inventory management becomes a precision art. Embrace blockchain—the key to unlocking substantial cost savings for your business.

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