The development of the worldwide economy is placing a lot of emphasis constantly on supply chain management and logistics. It happens particularly on the basis of today’s shipping backlog at all major global ports and the deduction in the availability of commodities in shops. In such circumstances, Web3 is integrated with supply chains and logistics & offers a plethora of advantages, namely- decentralized data management, control of supply chain constituents, and aggregation.
Do you know which things make up the basic stack of web3 integrated supply chain and logistics? Is the automation of supply chain management and logistics just about web3? Well, it includes various technologies, namely- smart contracts, artificial intelligence, web3 programming languages, and distributed ledgers.Web3 technology keeps a record of all the documents related to the supply chain flow and represents data coordination from every supply chain participant like- organizer, supplier, and many more.
All the facts and statistics related to the logistics industry state that-
- 53% of the respondents stated that they expect blockchain to change the logistics industry. (Statista)
- 40% of supply chain leaders stated they intend to invest in blockchain & IoT sensors. (Statista)
- The U.S. retail logistics market size was valued at USD 43.17 billion in 2021 and is expected to expand at a compound annual growth rate (CAGR) of 11.0% from 2022 to 2030. (grand view research)
Let’s now look at the role of web3 in supply chain management and logistics:-
Web3: How Is It Beneficial For Supply Chain & Logistics?
With the underlying blockchain technology, Web3 can enhance supply chain and logistics management in the following ways:-
1. Improves Traceability & High Operational Efficiency
Web3 brings several improvements in supply chain management and logistics management via the securest way of monitoring and surveying the enterprise supply chain and logistics. With the increment in the level of digitization, consumers have begun asking for sourcing data about the products they order & purchase. This way, Web3 with blockchain technology enables several enterprises to appreciate their supply chain and logistics metrics. Besides, this technology assists enterprises in communicating with customers with real, verifiable, & immutable products and transaction data as well.
2. Web3 Builds Transparency
With the help of Web3 development company, you cannot only create independent & extraordinary hash values for data and every transaction, including claims & certifications but also forms trust and security within the supply chain and logistics management process. It also grants individuals permissionless and open access so that they can go through the entire procedure of supply chain and logistics management.
Once Web3 registers a supply chain of an enterprise, it immediately verifies its authenticity with the help of network validators. This newest version of blockchain technology involves the factor of transparency that is helpful in updating and validating information on the Web3 supply chain on a real-time basis.
3. It Offers Tradability To The Supply Chain & Logistics Industry
One of the most significant features of Web3 is tradability, which defines the quality of readability and redefines the traditional concepts related to the marketplace.Web3 & blockchain enable participants of the supply chain to tokenize an asset very easily. This way, they can divide the commodities into equal portions and acquire approval of legitimate or digital ownership of participants who tokenize the assets. It’s completely the same as fractional ownership shares in a stock exchange. Then, all of the tokens will become easy to trade and transfer for the token owners.
Web3: How It Streamlines Product Recall In The Supply Chain
Global supply networks support everything from consumer packaged products to product recalls. Because recalling consumer goods or raw materials is a must to stop injuries or diseases. Recalls of consumer commodities have a destructive effect on millions of people worldwide due to several reasons, including lost sales, restoration expenses, and legal fees. In such situations, Web3 improves product traceability by reducing reproduction and propelling product recall.
Web3 enables manufacturers to search compromised items rapidly & readily, making recalls less expensive or more effective. Furthermore, this blockchain-based technology allows a supply chain to permit visible, traceable, quick, and more effective recalls.
Web3 Improves Regulatory Compliance & Reporting In The Supply Chain And Logistics Space, How?
There is a wide range of patients who entirely rely on prescription medications, and that’s why all pharmaceutical corporations have become more serious regarding administrative and concurrence reporting concerns. Moreover, the supply chain prevents the companies from understocking or even overstocking drugs to operate in a more efficient way.
Automation of conformity and reporting on the basis of Web3 prevents errors generated because of the manual processes and also cuts all the expenses related to the reporting. Web3 has the ability to enhance compliance more significantly as it reports for medical devices, pharmaceuticals, manufacturers, and various consumer items also. Additionally, it is the best technology that delivers real-time information and disseminates information to the most appropriate stakeholders.
How does web3 automate commercial processes in logistics?
Web3 offers great potential to boost productivity across the logistics and supply chain planning phase, including trade finance, and to assist in resolving conflicts in the logistics sector. Smart contracts can be enabled using digital agreements and real-time shipping data that are integrated into web3-based platforms. As soon as predetermined circumstances are satisfied, these contracts can automate business activities.
Because of smart contracts, retailers no longer use brokers, attorneys, or other intermediaries to execute tasks. Retailers and logistics firms can engage in legally enforceable agreements with smart contracts that will end promptly if all predetermined conditions are not satisfied. These ledger-based contracts reduce delivery times and expensive mistakes while increasing transparency and revenues.
Web3 Technology: How Can It Change The Face Of The Logistics Industry?
In the logistics industry, Web3 creates a decentralized ecosystem that allows innumerable direct or indirect stakeholders to track price, date, actual-time location and status of shipment without any kind of obstacle. Web3, based on decentralized technology, shares data in such a way that leads to the enhancement of the level of transparency of the logistic sector ecosystem and overall traceability of commodities. Now, it’s time to dig deep into how Web3 technologies can revolutionize the logistics industry:
1. Track Good’s Movement Efficiently
Integration of Web3 technologies in the logistics sector exposes the ability to track goods directly from the warehouse to the customers. The decentralized way of sharing information makes it too simple for all the involved parties to track the movement of goods in real-time. Moreover, when blockchain technology is used to store shipment-related data, the requirement for logistic companies or firms decreases. So, there is no requirement to take any stress related to manipulation or tampering with the data.
2. Allows Businesses To Move Forward For Planned/Scheduled Delivery
Web3, the blockchain technology, improves the way of doing freight tracking and real-time data analysis. It enables all forms of businesses to move towards already prepared delivery. Planned delivery is the greatest way to allow businesses to streamline the whole manufacturing process and all other interconnected processes to enhance the level of efficiency. With the integration of Web3 technologies into the business, all business people can have the option of same-day delivery or two-day delivery.
3. Reduces Overload Of Paperwork
Businesses that are involved in coordinative operations can understand very easily how hard it is to maintain the appropriate paperwork for the shipment. Maintaining shipment records generates a great burden of unnecessary paperwork, including- invoices, receipts, payment records, and others.
Thanks to the logistic companies that use blockchain-based smart contracts to reduce the paperwork and automate the payment process. Every blockchain-based smart contract has the ability to eliminate the involvement of third parties in the shipment, reduce the processing time, make payments timely, and manage data in the most appropriate way.
4. Tracks Effectiveness Of The Partner Logistic Company
Web3, the most advanced technology, enables businesses to leverage real-time data for tracking the effectiveness of the partner logistic company. With the assistance of this technology, the business person can track the delivery effectiveness of not only a logistic partner company but also a specific vehicle in a fleet. Furthermore, this data analysis is helpful for businesses to search for the major or minor shortcomings in the system and enhance the efficiency level of the overall supply chain.
5. Creates A Transparent Ecosystem
Integration of Web3 technologies in the logistics sector is beneficial for establishing a transparent ecosystem for all the purchasers, sellers, and suppliers. This way, all of these involved parties can have essential and exact information about the origin of the products, real-time location, and expected delivery date. This real-time data is helpful to businessmen in streamlining interconnected business procedures and enhancing the overall efficiency level of business processes.
All Things Considered
The implementation of Web3, the blockchain-based or decentralized technology in the supply chain or logistic industry, is an evolution rather than a revolution. Presently, many industries are using this technology that will enable them to pave new growth opportunities for businesses worldwide. It’s the most effective tool that enables businesses to be ready to face existing problems. If you are looking for a robust web3 supply chain and logistics solution for your project, connect with web3 experts.