Blockchain Traceability in Supply Chains
Updated: Jul 13
Blockchain has emerged as a major game-changer in the financial services industry. It has demonstrated promising applications in the domain of supply chain management, attracting attention to blockchain traceability. The blockchain is essentially a decentralized ledger or a digital system that records transactions between multiple parties in an open, verifiable, immutable, and secure manner. This case study provides a comprehensive review of the technological underpinnings of traceability in the blockchain. Furthermore, an overview of the potential uses of blockchain traceability in different areas of the supply chain.
When it comes to business logic, blockchain may provide improved traceability by improving transparency into the specifics of consumer items' origin. It also enhances the precision of asset monitoring across the supply chain, assuring auditable asset monitoring while also limiting exploitative behavior. Even in today's technologically advanced world, blockchain applications in supply chain management have the potential to improve efficiency.
There are many issues with the way the supply chain is taken care of as of today. The shipping industry spends almost half of the cost of transportation on paperwork. There have been concerns about mislabeling in food products and including ingredients sourced through illegal measures, falsification of high-end products, and the copying of consumer goods (such as electronics and pharmaceuticals) that brings the necessity of integrating blockchain traceability.
Blockchain technology has the potential to improve the efficiency of company operations while also lowering the prices of supply chain infrastructure in the logistics sector. There are many parties involved when it comes to a supply chain model, such as manufacturers, suppliers, retailers, distributors, auditors, and customers. By incorporating traceability into it, enterprise blockchain technology has the potential to disrupt traditional supply chain management through mapping and visualization of company supply chains, blockchain can utilize traceability to improve operational efficiency.
Replacing traditional supply chain operations with distributed ledger technology can increase US trade volume by 15%. Furthermore, the effort has the potential to increase the US GDP by about 5%. Traceability in blockchain might ensure that everyone can see the chain of custody and the path of an asset through the supply chain in real-time.
Blockchain might provide traceability in a variety of industries. Here are two examples on where blockchain could improve these issues:
Every year, the weight of counterfeit goods costs the fashion sector a lot of money in terms of yearly sales, and brands are losing market trust. A prospective feature of traceability is the use of unique identifiers to verify the uniqueness of items. The unique identity might assist you in determining where the product has been along the value chain.
Traceability in blockchain technology might provide access to a permanent digital record of materials, chemicals, parts, and other items in the manufacturing industry. As a result, it may assure a rapid increase in the visibility of the production process from beginning to finish. Most notably, it may aid producers in enhancing supply chain traceability.
The advantages of security and interoperability lead to promising future applications of blockchain tracing. We are excited to see new developments in the industry!