Case Studies

Blockchain in Supply Chain Industry – A Complete Guide for 2020

The way that blockchain works mean that the data within a block can’t be altered, and tampering with blocks is all but impossible.

There is a single source of the truth for any transaction and Blockchain in Supply Chain management allows for complete verification and suitability of any transaction flow.

This means that for blockchain in the supply chain, companies can build trust that transactions are correct and secure–even in instances where there is little or no trust established between the parties.

Blockchain in Supply Chain Use Cases

Blockchain examples in the supply chain are still in short supply, there are an increasing number of supply chain management use cases for blockchain being investigated, including :

1. Finance

Supply Chain finance solutions and blockchain provide an efficient increase in voice processing and provide more transparent and secure transactions.

This is how blockchain offers a good deal of interest in its solutions.

For example, invoice payment terms are usually 30 days and maybe even longer.

By combining supply chain finance and blockchain technology, smart contracts can be applied for that trigger immediate payments as soon as the product is delivered and signed for.

2. Food Safety

Food safety issues such as cross-contamination, the spread of foodborne illness, as well as unnecessary waste and economic burden of recalls are made worse by lack of data and traceability.

It takes a lot of time to find out the major cause of the food being contaminated.

This means sicker people, lost revenue, and wasted food.

For example, according to the CDC, it took more than two months to identify the farm source of contaminated papayas in a salmonella outbreak.

Worldwide, one-in-ten people fall ill—and roughly 420,000 die—due to contaminated food, according to the World Health Organization.

Companies including Nestle, Walmart, and Unilever are using blockchain to reduce the time it takes to pinpoint and remove the source of foodborne illness within the supply chain.

IBM will be part of a consortium to determine how the global supply chain can benefit from the blockchain.

Blockchain in Supply Chain Industry enables companies to trace contaminated products to its source quickly and ensure safe removal from store shelves and restaurants, according to IBM. 

Blockchain in Supply Chain Industry

3. Procurement

Blockchain in Supply Chain acts as a single source of truth for all the entities doing purchases on your behalf and negotiating different terms with suppliers.

A blockchain-based database can store relevant data from all your partners, giving your company a 360-view of the total volume of purchases, regardless of who managed the purchase activity.

There will be no need for individual users to constantly share operational data and someone else to cross-check it the audits will be conducted automatically, eliminating the resource-heavy processes such as extra price verification.

To illustrate,

If an organization wants to negotiate a procurement deal based on total ecosystem volume which includes data from both the partners.

Storing data in a blockchain-based system means that you can effortlessly calculate the exact volume discount based on total purchasing and mathematically prove that it is correct. 

4. Provenance and Improved Traceability

 The food supply chain under blockchain comes with an idea of the distribution of fresh produce.

Several major food-borne bacteria outbreaks, which have recently happened in the US, are encouraging more and more companies to look into blockchain as a new method for increasing visibility and traceability of the goods. 

Walmart along with IBM enables blockchain-based traceability solutions that would be applied across the company’s food supply chain.

They track the incoming food supplies from farms to store in time.

Aside from increased visibility, the company also explores how blockchain technology can be extended towards monitoring and controlling the spread of foodborne illnesses and help minimize costly recalls.

5. Digital contracts and payments

Even the most successful companies have to deal with days sales outstanding or even payment upon receipt.

This issue comes from the fact that current invoicing processes are inefficient because most of them are done manually on both sides.

Smart contracts in blockchain work to patch procure- to- pay.

Payments are codified and proof of delivery has been provided by the logistics company.

Smart contracts in supply chain management can help reduce data redundancy across trading partners and eliminate costly mistakes.

For instance, if a supplier sends a duplicate invoice, the blockchain-based system will analyze all the elements of the contract – contract terms, open purchase orders, or existing invoices.

Smart contracts in blockchain act as a third party that reviews all the contract aspects and clauses, only accepting entries that match all the pre-programmed values.

This means, no errors, dubious or lost invoices can creep into your records.

6. Supplier Payments

Blockchain in Supply Chain promises to facilitate fast, secure, low-cost international payment processing services (and other transactions) through the use of encrypted distributed ledgers that provide trusted real-time verification of transactions without the need for intermediaries such as correspondent banks and clearinghouses.

One example of Blockchain in Supply Chain for supplier payment is within the coffee industry.

Bext360 is using blockchain technology to better track all elements of the worldwide coffee trade—from farmer to consumer—and thereby boost supply-chain productivity.

Using cryptocurrencies, this application of Blockchain in Supply Chain ensures payment directly to the farmers immediately when their products are sold. 

7. Cold chain traceability

Food and pharmaceutical products often have similar storage and shipping needs.

Blockchain with IoT sensors on the product can record temperature, humidity and vibration, and other environmental factors.

The data is stored in a blockchain and smart contracts applied to ensure automatic redress if any of the readings go out of range.

One early example of blockchain for the food supply chain is Walmart’s innovative use of the technology to track the provenance and condition of its pork products coming from China.

With the success of Blockchain in Supply Chain Industry, Walmart now requires all its spinach and lettuce suppliers to deploy the technology. 


Cryptic Ocean is a blockchain technology company that provides end-to-end blockchain development and blockchain consulting services to multiple business domains.

Our goal is to help companies adopt new technologies and simplify complicated issues that arise during technology evolution.

Contact us for the best solutions about the use of blockchain technology to solve the toughest challenges faced by the world today.


What is the use of Blockchain in Supply Chain?

Blockchain technology ensures efficiency and transparency of supply chains and ultimately provides positive impacts from warehousing to delivery to payment. 

Which Blockchain is best for the supply chain? 

Ethereum blockchain is best for the supply chain because it enables and increases traceability and tracking of food safety.
Accurate tracking of contaminated food is often very complicated, so the supply chain based on blockchain technology could drastically reduce the time required to identify the source. 

How Blockchain is transforming the supply chain?

With blockchain, it helps in lessening costs of the moving items because it allows real-time tracking of the product without the involvement of a third – party.
Removing intermediates cuts of counterfeits or frauds, costs, and product duplicate.

What is the difference between Blockchain and supply chain? 

A supply chain is a network for delivering products and services from raw materials to end customers through an engineered flow of information, physical distribution, and cash, however, blockchain is an open distributed ledger that can record transactions between two parties efficiently and in a verifiable and permanent way.

Must read our more interesting Articles.


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