Blockchain is one of the most talked-about emerging technologies within the logistics industry because of its ability to improve transparency in operations, aid in tracking shipments easily, and help verify the origin and quality of products.
By 2023, blockchain is set to support the global movement of up to $2 trillion worth of goods and services annually, according to Gartner. As the pandemic continues, demand has increased for access to information such as production processes, type of ingredients, and safety protocols associated with products delivered, especially those like vaccines and their active ingredients. Blockchain could offer a reliable way of providing this information – but what is it and how does it benefit logistics companies and their customers?
In the simplest terms, blockchain technology is a process of collecting time-stamped information in an encrypted format, which is stored on a network of computers. This information is secure and can’t be modified or deleted, and is accessible only to those who are authorized to use it.
Ditch the paper
Let’s take the example of organic dates shipped from a farm in the UAE to a customer in France. This involves a farmer, a manufacturer, a retailer, and – the common link – a logistics company. The journey usually involves a great deal of documentation and manual data entry at multiple points.
This is a time-consuming process as information is saved either on paper, in emails, or in different digital formats. Any inaccuracies in capturing the right information across these multiple formats can result in delay, damage, or fraud.
With blockchain technology, these processes will be digitized and the information generated from all the data points starting from the farm in the UAE, the logistics process, and the movement of the package across one or more borders, to the customer in France, will be ‘glued’ together. Blockchain will create a single trusted source for all those steps.
Not only does the customer in France want to know that these dates are authentic, and they came from a specific farm in the UAE, but the farm also wants to be able to prove that their dates are of premium quality so they can sell their very unique dates potentially around the world.
The writer is Regional President of FedEx Express Middle East, Indian Subcontinent and Africa.