Precisely, logistics related cost savings of roughly $450 billion for businesses in Western Europe can be realized, if blockchain adoption is carried out in a full-fledged manner. Additionally, the report states that the expenses incurred to implement the technology will pay for itself in the long-run.
“94% of supply chain leaders say digital transformation will fundamentally alter supply chain management. In the transition to industry 4.0, industrial business can expect a 25% gross increase in [Return on Capital Employed] by 2035.”
Cointelegraph Consulting and Insolar studied the issues faced by enterprises in handling their logistics network. The study points out that 60% of firms pay a premium to their supply chain partners. Furthermore, 70% of companies are affected by “visibility gaps” between the initial vendor and internal customers’ systems, turning supply chain tracking a difficult and sometimes even an impossible task.
Present tech solutions such as enterprise resource planning and conventional databases are not properly equipped to resolve basic supply chain issues as almost 80% of enterprise data is ensiled and liable to minimized integrity. The study further states:
“The database approach fails to provide an inherent share of data related to the supply chain, which is crucial for counterparties that do not trust each other to obtain information about a certain product, its price, delivery conditions, etc. The information is not always up to date from some parties, and some data may be hidden.”
Insolar’s founder, Peter Fedchenkov, opined that the deployment of blockchain systems will not mean an end to the prevailing IT systems. He believes that both will complement each other and exist at the same time. Fedchenkov said:
“When people think about blockchain there is a misconception that it’s a new paradigm requiring a change in business entirely. We believe this is wrong though, and offer an approach to complement organizations existing IT infrastructures using our blockchain platform.”
Cointelegraph Consulting, which was launched on December 3, intends to support blockchain adoption among small and medium-sized businesses by connecting them with appropriate blockchain systems suitable to their operations.
Blockchain technology is being widely adopted in tracking supply chains of various industries such as diamonds, rare metals, fashion items and food. As per top US retail firm Walmart, distributed ledger technologies such as blockchain will simplify the process of recalling drugs or food products, if need arises.
Last week, Big Four audit firm KPMG unveiled a blockchain powered track and trace platform in Japan, Australia and China.
Of late, retailer Carrefour and Swiss company Nestlé became a member of IBM’s Food Trust platform to trace the supply chain of infant milk formula using blockchain based system.
Likewise, in August, Indian state of Maharashtra started its work on a regulatory sandbox to trial blockchain in several applications such as agricultural marketing, supply chains, document administration and vehicle registration.