Traceability and supply chain management

Blockchain technology can empower many small and medium enterprises to integrate supply chain tracking into their business. What was once only available to huge market players such as freight carriers and corporate retailers, can now be accessed by anyone with an internet connection and a smartphone, thanks to Logyq.

The benefits of blockchain supply chain tracking are numerous, and include an easier business digitization process, reduced product recalls and improved transparency, which leads to better profits. In fact, a study conducted by SaaS company Label Insight in 2016 found that 94% of consumers were likely to be loyal to a brand that offers complete transparency, and 73% of them were willing to pay more for products with completely transparent supply chains. Blockchain traceability solutions are superior to standard centralized solutions because they are trustless and unmodifiable by design, therefore the risk of tampering is highly reduced. Once data about a specific item is registered on the blockchain, it is impossible to delete it or modify it. This poses a different producer - consumer relationship than before, since the consumer can now actively scan the producer’s quality logs and look for proof of sustainability and changes in the production process. Furthermore, associating each individual item to corresponding metadata on the blockchain significantly improves efficiency if product recall becomes necessary: instead of recalling the entire line of products, one can identify the items that have been compromised and only act on those that are defective. ¹

The Cardano blockchain offers significant advantages over its competitors: its speed and reliability make it so that transactions carrying metadata can be sent quickly and reliably, so as to update information as soon as it is available, if needed. Furthermore, the integration with ATALA Prism and other DID solutions make it so that specific steps within the supply chain can be linked to or authorized by specific users. Cardano’s commitment to sustainability has spurred many initiatives in supply chain traceability, giving it a considerable head start in bringing together a network of producers using blockchain technology as their main traceability solution.

The food² and pharmaceutical³ industries are the ones that can benefit the most from blockchain tracking in emerging markets: both have trouble with counterfeiting, and both experience considerable financial damage from the lack of trust that it fosters. Assigning each item a QR code, and pairing it with its blockchain counterpart, can enable consumers to be certain of the provenance of a particular good, and of its qualities; only authorized producers can emit a certified QR code for the specific product, which makes it extremely easy for customers to scan it at the counter to make sure it is a legitimate product.

¹: According to IBM, blockchain can reduce the average product recall cost by up to 80%. Blockchain's traceability makes it possible to easily identify the source of a problem and engage in strategic removals of affected products instead of recalling the entire product line.

²: Estimates suggest that 30%-40% of the food consumers eat is either "adulterated or mislabeled" (www.connect.catalyst-inc.org/techwatch/arcnet). In a survey, 39% of food manufacturers thought that their products can be easily counterfeited. According to a 2019 study by Juniper Research, the global food industry could save about US$31 billion in food fraud costs by 2024 by adopting blockchain to monitor supply chains.

³:Of all the fake drugs reported to the WHO between 2013 and 2017, 42% of the reports came from the African continent.