The recent economic and supply chain crises should have taught us by now: investing in the supply chain and its updating to the latest technologies is essential.

In addition to the need for better logistics management, there is also a cultural factor: consumers increasingly feel the need to be informed about what they are consuming.

But blockchain applied to the supply chain tends to improve a third aspect of the issue: tax and procedural compliance. National and community regulations are increasingly stringent, and greater transparency can only row in favor of this need.

So far we have only touched on transparency, but in this article we will look in more detail at how blockchain can positively disrupt even the most complex and layered supply chains.

Growing pressure from consumers, regulators and stakeholders calls for greater transparency, traceability and accountability in supply and distribution processes. In this context, blockchain technology emerges as a revolutionary solution, capable of transforming traditional supply chains into highly efficient and ethical ecosystems.

Step One: What is Blockchain?

There are many explanations online, but this is the concept in simple terms: Blockchain is a decentralized technology that records data immutably across a distributed network of nodes. 

The most interesting aspect, however, is that each "block" contains information linked to the previous block, creating a chronological and verifiable chain. 

How does this apply to the supply chain? Essentially, this technology can be used to record information about raw materials, manufacturing processes, transportation, and delivery. 

Every transaction is verified and permanently recorded, making it impossible to manipulate or alter the data without the consent of all parties involved.

A revolutionary concept, but let's see its practical advantages.

Benefits of Blockchain in Supply Chain

The application of blockchain in supply chains introduces a series of benefits that directly address the needs of businesses and consumers.

1. Product traceability

Thanks to blockchain, every product can be traced throughout its life cycle, from the producer to the final consumer. This level of transparency allows to verify the origin of raw materials and compliance with environmental or ethical regulations.

• Practical example: A supermarket chain can assure customers that a pack of strawberries actually comes from a specific organic farm by displaying the full history via a QR code on the package.

2. Fraud Reduction

Supply chain fraud, such as falsified certifications or data alteration, is a significant problem. 

With blockchain, every transaction is verified by multiple nodes, making it extremely difficult to alter data without detection.

3. Operational efficiency

Blockchain eliminates the need for intermediaries and complex systems to verify transactions, reducing the time and costs associated with them. Smart contracts can automate operations, such as automatic payment upon reaching specific goals, improving overall efficiency.

Blockchain Problems

In order to provide a comprehensive overview, it is important to also take into account the problems that still need to be addressed regarding blockchain. 

First of all, blockchain adoption requires significant investments in technological infrastructure and staff training.

Then, integrating blockchain with existing systems can be complex, especially for companies with highly fragmented supply chains.

Finally, as is true for democracy, everyone must agree to use blockchain. 

We could compare it to a fundamental unit of measurement, or a technological standard. The adoption of blockchain necessarily requires the involvement and collaboration of all the actors in the supply chain, and as you can imagine they are not always easy to obtain and above all there is not yet a political authority capable of standardizing this standard by extending it to all companies operating in the supply chain.

It may be too early to talk about standards, but blockchain certainly brings with it advantages and solves many problems that will be the problems of the future. 

For example: 

• Consumer demand for transparency is growing over time, and will be even greater in the future;
• There are already a variety of government incentives and regulations that promote sustainable and ethical practices;
• There are already several platforms under development that offer blockchain-as-a-service, in order to reduce initial costs and complexities.

Which sectors?

Blockchain can be applied to different sectors, e.g. in the food and agriculture sector it guarantees complete monitoring of the supply chain, while in healthcare it can protect patient data and prevent drug counterfeiting. 

In the financial sector, blockchain facilitates fast and secure international payments, reducing costs by eliminating intermediaries. 

Logistics benefits from more efficient shipment management, while the energy sector adopts decentralized models and incentives for renewable energy. 

In fashion and luxury it fights counterfeiting and certifies sustainable practices, just as in the real estate sector it simplifies sales and guarantees the authenticity of registers. 

Then, art and entertainment could exploit blockchain to protect copyrights and develop innovative digital markets, as is already the case for NFT.

Instead, public administration uses it to digitize registers, manage public funds and electronic voting. The pharmaceutical industry, e-commerce and many other areas also benefit in terms of efficiency, transparency and data protection, making blockchain a revolutionary technology capable of transforming entire industries.

2 case studies

1) Walmart and food traceability

Walmart has implemented a blockchain solution to monitor the freshness of agricultural products throughout the supply chain. In the event of food contamination, the system allows for rapid identification of the source of the problem, reducing waste and ensuring food safety.

2) De Beers and ethical diamonds

Diamond giant De Beers uses blockchain to certify the ethical origin of gemstones, ensuring they are not sourced from conflict zones. This system increases consumer trust and promotes responsible mining practices.

Conclusion: An ethical and sustainable future

Blockchain represents a new standard for transparency and business ethics. By enabling the monitoring of every aspect of the supply chain, this technology not only improves operational efficiency but also promotes sustainable and responsible practices. 

Companies that adopt blockchain can strengthen consumer trust and position themselves as leaders in an increasingly sustainability-oriented market.