The Future of Blockchain and Your TMS
Blockchain software solutions have come a long way since its debut. While it’s known widely as a cryptocurrency security solution, there is a home for blockchain technology in transportation management systems. However, to integrate blockchain software into the TMS, logistics carriers, shippers, and 3PL’s must think outside the box to explore the most efficient areas where blockchain can assist.
Noted below are a few of the areas where logistics professionals can integrate blockchain technology to help improve TMS systems, processes, and solutions.
Improving Food Safety
The blockchain was initially developed as a record-keeping system that makes it safer and easier for businesses to network and work together over the internet. Since the supply chain is quickly becoming a cloud-based and internet business, this type of technology improves the safety of operating in this space. This type of tracking ability is critical when it comes to food safety.
There are a few specific areas where the use of blockchain technology can reduce the potential of food contamination and improve overall food safety standards.
• Blockchain solutions record the quantity and transfer of all food-related assets such as trailers, pallets, containers, and more – as they move throughout the supply chain.
• Blockchain software can assist with organizing purchase orders, order changes, receipts, shipment notification records, and other trade-related documents – for easier access if a food safety issue is discovered. This can stop the spread of bacteria or discover the root source of a food-borne illness to reduce the potential of further problems.
• Links physical goods and supplies to barcodes, serial numbers, digital tags (like RFID), and more. Having the ability to track food at each point of shipping improves transparency, reduces delays and ensures the timely arrival of perishable items.
Whether you’re a retailer or distribution center, a leading cause of overhead issues is shrink. When the product ‘vanishes’ or becomes damaged due to negligence, it always impacts the bottom line. For shippers and carriers alike, finding ways to reduce shrink is a leading concern. Believe it or not, the integration of blockchain technology can help to prevent lost shipments and thus – reduce the potential of shrink occurring. Blockchain solutions provide transparency throughout the supply chain – and also assigns accountability. According to many experts, several shipping issues or missing shipments are caused by theft (especially in situations where tracking is limited). The use of scanning technology and tracking software solutions can reduce this from occurring.
Streamlines the Payment Process
When blockchain was initially discussed within the supply chain community, the initial integration was to be focused on payments. Blockchain was initially a software solution to improve the security of cryptocurrency transactions. Well – honestly, the same technology can help to reduce billing errors from shippers, carriers, 3PL’s and more. Here are a few reasons why:
Improved transparency: With blockchain solutions, there is no way to claim that ‘the paperwork is missing’. Blockchain software keeps every transaction in redundant cloud-based files that can be accessed by anyone within the network – at any time. This reality improves transparency across the board – and eliminates the potential of billing errors based on ‘missing paperwork’.
Eliminates unethical actors: A leading cause of financial loss in the supply chain are scrupulous players within the community. Whether it’s the carrier who inflates the actual mileage traveled or the shipper who claims a late delivery, the blockchain virtually eliminates the potential of falsifying billing records.
Makes payments more secure: With multiple secure platforms to navigate, processing payments through blockchain software solutions is incredibly safe and secure. This also ensures proper storage of bills and all financial records, to reduce the potential of double-billing.
What Supply Chain Partners Need for a Smooth Integration of Blockchain Technology in TMS
There are three general tips that current blockchain technology users recommend to those in transportation management to ensure a smooth transition.
• Understand the basics of blockchain technology: Blockchain is a highly complex technology solution. While we’ve outlined a few details, there is so much more than any organization should learn before making the switch. Reach out to blockchain software providers directly to determine how blockchain technology can help you specifically.
• Scalability is the best approach: While it might seem attractive to ‘pull the trigger’ and go full throttle with blockchain solutions, it’s recommended by many industry experts to walk slowly with blockchain. Consider a scalable approach at first.
• Invest in internet technology: Blockchain solutions are 100% cloud-based. So having the best internet connection and most importantly – top flight internet security programs and solutions is the best way to use blockchain within the TMS.
The blockchain is coming sooner than later to the supply chain. Organizations from suppliers, shippers, carriers, 3PL’s and more would be smart to speak with experts in this industry to determine how to best understand the future of blockchain and your TMS.