Blockchain’s Monumental Impact
In many industries, blockchain technology is still in the early stages of application. However, some consumer goods companies already are starting to realize its potential. As the technology further matures and more organizations understand the benefits, CGs should explore the relevant capabilities and implement blockchain into their business processes.
At a basic level, blockchain is an open-source distributed ledger that can publicly and securely record transactions between two parties in a verifiable and transparent manner. Its architecture ensures that digitally recorded data cannot be tampered with or deleted, as blockchain can provide an irrefutable, validated record of product provenance from raw material origin to point of consumption. It has the potential to improve transparency and accountability across the entire supply chain, providing consumers more information on the products they're buying.
The World Economic Forum predicts that 10% of gross domestic productwill be stored on blockchain technology by 2027. It’s time for all CGs to take steps toward understanding the technology and how they can apply it to improve various facets of their business operations.
One of the most important capabilities of blockchain for the consumer goods industry is traceability. Better traceability will let organizations efficiently orchestrate their goods to market, mitigate risk and better track a product’s journey to the end-consumer. They can track and trace materials back to the source, show origin and prove authenticity. This will serve the interests of an increasing number of consumers who want to know where their products come from, what's in them and whether they are ethically and sustainably sourced. Consumers can trace the food they eat from farm to table, assured that it is organic and that is was humanely treated, for example. Or, a consumer can determine whether the diamond in an engagement ring came from a conflict-free area, confirm its carat size and verify its authenticity.
In addition, blockchain can aid in cold chain monitoring, allowing companies to ensure that their perishable goods have been stored at the right temperature throughout the product lifecycle and are safe for consumption. Furthermore, keeping perishable products fresh for as long as possible reduces waste and cost, and establishes trust among consumers.
Blockchaintechnology does not rely on a private database that could be tampered with. Rather, it provides a public, transparent ledger of logistics and temperature history throughout the supply chain.Also, blockchain solutions can speed up logistics, minimize discrepancies and drive cost savings through streamlined processes.
Blockchain can provide unprecedented value to the shipping industry, as well. In today’s connected world, businesses are looking for ways to optimize every aspect of their supply chain, and blockchain is proving to be a key resource.
Shipping distributors can utilize a decentralized network that connects all parties of the trading supply chain. Using decentralized technologies, all communication between these multiple parties will be more efficient, eliminating the need to go through a specific, central gatekeeper. Connecting all members of a supply chain allows for the direct exchange of documents, solving one of the shipping industry's largest problems.
A Powerful Future
In today’s digital economy, it’s crucial that organizations continue to implement new technologies to transform their processes and drive value. As companies look to stay ahead of the competition and ensure they're meeting consumer expectations, they need to build a digital framework that promotes trust, security and visibility.
While it’s still an emerging technology, blockchain can make a profound impact on the consumer goods industry, and it’s critical that brands look into and invest in the technology sooner rather than later.