2018/04/11

How does block chain affect the logistics industry and supply chain?

Asof today, block chain was known and used by more and more people. Block chain, which affect all aspects of the trade, has brought a lot of unprecedented concepts. But, how does it affect the logistics industry and supply chain?

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What is blockchain and how could it affect supply chain?

While the most prominent use of blockchain is in the cryptocurrency, Bitcoin, the reality is that blockchain—essentially a distributed, digital ledger—has many applications and can be used for any exchange, agreements/contracts, tracking and, of course, payment. Since every transaction is recorded on a block and across multiple copies of the ledger that are distributed over many nodes (computers), it is highly transparent. It’s also highly secure since every block links to the one before it and after it. There is not one central authority over the blockchain, and it’s extremely efficient and scalable. Ultimately, blockchain can increase the efficiency and transparency of supply chains and positively impact everything from warehousing to delivery to payment. Chain of command is essential for many things, and blockchain has the chain of command built in.

The very things that are necessary for reliability and integrity in a supply chain are provided by blockchain. Blockchain provides consensus—there is no dispute in the chain regarding transactions because all entities on the chain have the same version of the ledger. Everyone on the blockchain can see the chain of ownership for an asset on the blockchain. Records on the blockchain cannot be erased which is important for a transparent supply chain.

Examples of blockchain being used in supply chains today

In the food industry, it’s imperative to have solid records to trace each product to its source. So, Walmart uses blockchain to keep track of its pork it sources from China and the blockchain records where each piece of meat came from, processed, stored and its sell-by-date. Unilever, Nestle, Tyson and Dole also use blockchain for similar purposes.

Diamond-giant De Beers uses blockchain technology to track stones form the point they are minded right up to the point when they are sold to consumers. This ensures the company avoids ‘conflict’ or ‘blood diamonds’ and assures the consumers that they are buying the genuine article.


There are several supply chain startups such as Cloud Logistics who saw an opportunity to provide blockchain-enabled supply chain solutions to improve efficiency and reduce costs for the massive supply chain industry. More will most certainly join them as they realize the potential and demand for blockchain-enabled solutions to transform the supply chain and logistics industry.

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