The supply chain is the backbone of your business regardless of what you offer customers, as you need to move your products from your warehouse to your consumer as smoothly as possible. However, there are many challenges you will face as an e-commerce business. Today’s global ecosystem has a complicated supply chain and by dealing with your partners, each with their own logging systems, you may experience a loss or confusion of information. To simplify communications of global supply chain, blockchain technology has been developed for business like yours. Here’s what you need to know about the new tech and how it is transforming the supply chain.
What Is Blockchain?
Blockchain for the supply chain is secure, distributed electronic leger that connects multiple parties in a trusted network of integrity. It facilitates the transfer of assets and information pertaining to those assets. The technology was invented in 2008 to power Bitcoin (and now other cryptocurrency) when it launched in 2009 and is now being used for everything.
It achieves its purpose by securely making a record of digital transactions in a chronological chain using cryptographic digital keys that are verified as authentic. The chain prevents duplication, editing, and removal of transactions, and is visible to anyone on the network via their computers. The longer the blockchain and wider the network is, the more complex the digital key is. Therefore, it becomes more secure.
Benefits of a Supply Chain with Blockchain
Purchase Process Automation
Automatic contracts (smart contracts) can be set up with blockchains. Once the users agree upon certain conditions, smart contracts automatically spring into action to execute their terms, whether it be service payment, shipment authorization, etc.
If boosting customer satisfaction has been a challenge for you in the past, blockchain is one tested and true solution. Retailers can use the database to view items in the production process to build a better delivery time for their store. This boosts customer satisfaction by showing them valuable information and improving communication. Customers can also access some information on the blockchain such as a social consciousness approval form or labour union sheet. By sharing data in this way, a new level of transparency is achieved with the consumer. This builds deeper loyalty through a better client relationship.
With blockchain, all information is loaded to the cloud. By digitizing the logging process, there is a reduction in administrative work and more consistent data tracing. Instead of connecting with your partners to get the information you need, you simply sign onto the chain and view the information by downloading it. All the information you need to know about the product is in one location, which streamlines the communications and operations processes. Even better, blockchain is worldwide and scalable which means the tech can support global partnerships and communications within minutes.
Transparency and Connectivity
Delays in commerce and a breakdown in relations is often caused by a lack of commercial transparency. Since blockchain provides details of transactions against the commercial construct, more transparency exists in the process. This provides a more stable relationship as it is founded on transparency instead of negotiation.
Security and Trust
As the network verifies each transaction using independently verified complex cryptography, you can trust that the information is authentic. Assured information is key to unlocking the benefits of the Internet of Things (IoT). Since copies of each document are chronologically stores and linked to previous blocks, it is very hard to hack. These blocks become highly secure and difficult to fake—hackers would need to change hundreds of copies at the same time, which is nearly impossible without the blockchain noticing the threat. Because of its high security characteristics, major financial services and banks trust this technology.
Blockchain promotes honest transparency. Everyone involved is required to upload their information and data about their products, and this collection of accurate data improves accountability and trust. Blockchain can also show updates about the product in minutes, so all partners are aware of where it stands in real time. Partners can see where the product is, how it is made, and when it is expected to be delivered, using just one platform. The technology builds communication through a visibly streamlined process that has shorter lead times, reduced redundancy and less delays. It ensures that standards are met to give the seller more control of production at each stage.
Since each transaction is recorded in sequence, blockchain provides a permanent audit trail for the life of an asset. This provides an advantage because source data is needed to verify an assets’ authenticity.
Does Your Supply Chain Need a Blockchain?
Blockchain is already transforming supply chains, industries, and ecosystems. If banks and financial institutions can trust the technology, you also have no need to fear. There are many more advantages to using blockchain to streamline your business. More businesses are seeing the potential and demand for blockchain-enabled solutions to transform the logistics industry and the supply chain. Working with a 3PL partner who provides such solutions can be a time-saving way for you to benefit, too.
Lean Supply Solutions can help you if you are looking for a 3PL company with the latest technology. We make ourselves aware of the rising trends in the logistics industry and always strive to stay up to date. We commit to being aware of our clients’ operational challenges as they arise and help them get the most out of their processes. Our 3PL, packaging, and supply chain management can streamline your processes for better success, and by striving to ensure that the right products are provided to the right customers at the right time, we can offer consistent, accurate, and quality results. To learn more about outsourcing to our 3PL distribution team, or to ask any questions, contact us.
Modern supply chain services have become more complicated as consumer expectations increase. Even with a good supply chain management system, there are hidden risks that could pose a significant threat to the industry and your organization. New technologies can help as they make their way into operations, but business managers still need to understand these hidden risks and take proactive steps to preventing them or reacting to them appropriately. Here are some of the most common supply chain challenges of 2018.
Having a global procurement network that can respond and support your many supply chain needs is important, especially with the globalization of manufacturing operations. However, choosing a strategic supplier that has multiple manufacturing locations with consistent global quality and reliable service for local customers can be challenging. With many options available, you need to choose a partner that has the experience and reputation you can trust.
Dealing with customer demands is another challenge all businesses will face. Automation is one solution that makes this responsibility easier, as well as improving shipping times, reducing fees, and providing faster and accurate order fulfillment. Customer service can improve with the use of artificial intelligence in the supply chain industry, but it can be expensive. Working with a third-party logistics (3PL) partner that already implements automation is a worthy investment, and many businesses have turned to these organizations to tackle this challenge.
Another aspect that presents a challenge for organizations today is the pursuit of new customers. There is a significant cost to produce and develop a new product, therefore companies are seeking to expand their distribution to grow revenue and increase market share. Companies are expanding their distribution out to foreign markets to bring in new customers—but this comes with its own challenges of trading policies, fees, and government policies. Working with a 3PL provider that already has connections overseas, or that understands these policies and can work within those constraints, will be a huge advantage to you and your business.
Predictions and Forecasting
To remain efficient as the supply chain changes, you need to include periodic assessments and redesigns as part of your strategy. These adjustments help you adapt to changes in the market such as new product launches, global sourcing, credit availability and the protection of intellectual property. To control and mitigate operations, these risks must be identified and quantified.
With the advancement and availability of technology, running your operations without it will only serve as a disadvantage. Like your competitors, it’s time to adopt technological advancements into your operations to keep up with the constant changes within the supply chain. There are many new tools available such as an “Uber-like” freight experience, inventory management software, and GPS tracking for delivery trucks. When seeking a 3PL partner, make sure they are up-to-date with the latest technology so you can get the best visibility.
Although the digitization of the supply chain provides many advantages, it has also introduced the risk of hacking and other vulnerabilities of cyberspace. Organizations must now take additional security measures to prevent these risks from occurring. Some of these measures relate to internal infrastructures, vendors, partners, and customers.
Ensuring that all business systems between all locations are connected is important for preventing poor inventory tracking and management. This synchronization is made possible through automation and inventory management software, which properly checks where items move within the warehouse, and provides an accurate count for online shoppers. It is crucial to effectively manage diverse structures of data to prevent losing proper management, visibility, or control over inventory.
Now that consumers are more accustomed to shopping online, there is added pressure on the organization to provide accurate results. Take the fashion industry for example: When an item is posted online for sale, the measurements and size, colour, and quantity must all be accurate. If the consumer buys a size medium, and a size large arrives, you could potentially lose a customer and deter them from ever shopping at your store again. Alternatively, if a consumer tries to order a product that says its available, but after checking out, realizes the item is on backorder, it will cause a great amount of frustration. Because of these issues, which are inevitable with e-commerce, you need to make sure your reverse logistics solution works well for both you and your customer.
How You Can Overcome These Supply Chain Challenges
It’s crucial for you to have a clear control and understanding of your business processes before you can take on these challenges. Without this understanding, it will be hard to respond to changing demands, which can add costs as you deal with production problems. A 3PL provider can help you manage your operations so you can focus on making your business and brand more accessible to your online shoppers. They can help you respond to the challenges mentioned above, so you save time and money and speed up your success and revenue.
If you’re looking for the right company to partner with, Lean Supply Solutions is the answer. We rise to the challenge of meeting our clients’ needs through our services which include product fulfillment, warehousing and distribution, e-commerce fulfillment, warehouse pick and pack, and order fulfillment. Lean Supply Solutions can offer consistent, accurate, and quality results. To learn more about outsourcing to our 3PL distribution team, or to ask any questions, contact us today.