Logistics To Surge Ahead With Blockchain
By Kapil Rajyaguru
The covid-19 pandemic had cataclysmic impact on the shipping industry by completely disrupting the global supply chain resulting in high-volumes of cancelled orders and huge losses.
Despite having proud history of several thousand years, the shipping industry has long been considered ‘behind the curve’ In terms of technological advancement. On the other hand, blockchain technology goes back only 12 years. However, in IT terms, blockchain is old technology and its potential in terms of revolutionizing the maritime industry are still ahead of it.
In post covid world, shipping congestion at the world’s ports has increased, causing delays, unexpected costs, and an international container shortage.
Blockchain can provide a unique solution to many of the aforementioned problems faced in the shipping and logistics industries today.
Benefits of Blockchain In Logistics
1. Enhance Supply Chain Transparency And Traceability
Blockchain provides a single source of truth by integrating data from all the participants in the supply chain.
Blockchain provides a proof-of-origin along with assurance of compliance and safety standards throughout the whole supply chain.
2. Ensure Security, Immutability And Authenticity
Due to its immutable characteristics derived via cryptography, blockchain provides a secure encrypted platform to exchange data and documents and detect fraud.
Blockchain can contain detailed information and rules, such as photo ID requirements for pick-up or delivery, which improves security.
3. Reduce Process Complexity
Blockchain replaces the role of third party by brining trust in the ecosystem and enabling peer-to-peer models.
Processes such as payments, transfer of ownership, settlement of tariffs or cargo checks can be automated by using “smart contracts”.
4. Improve Operational Efficiencies
Blockchain can be combined with Electronic Logging Devices (ELDs), which send data about driving behavior to a blockchain platform in real time, which improves compliance.
Smart contracts driven automation of processes reduces the potential for human errors, while being faster than manual processes.
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