Any economy’s driving power is the logistics and transportation industry. The constant change in economic structure and market needs, on the other hand, is causing this sector to slip behind significantly.
Even though this sector is the driving force behind every sector, such as manufacturing, supply chain, and agriculture, demands are at an all-time high due to current reforms. Lack of innovation, customer demands, and draconian legislation, for example, are currently wreaking havoc on this sector.
Although the payoff is still attractive, shipping firms are losing a large portion of their profits due to theft, dysfunctional business models, cyber-attacks, rising prices, and other factors. Mismanagement or stolen cargo will cost these businesses up to $50 billion a year in many cases!
However, blockchain technology has the potential to drastically alter the logistics landscape. In practice, blockchain technology will provide this industry with a more open and productive business model. More so, since blockchain technology can act as a ledger system, it is ideal for monitoring shipments.
Let’s take a look at how blockchain for logistics can shift the game and become the industry’s backbone.
But first, what is blockchain technology?
Blockchain technology is a network of peer-to-peer nodes that stores transactional records, also known as blocks, of the public in many databases, also known as the “chain.” This form of storage is generally referred to as a “digital ledger.”
Any transaction in this ledger is signed with the owner’s digital signature, which verifies the transaction and protects it from tampering. As a result, the data in the digital ledger is extremely stable.
In simple terms, a blockchain is a digital distributed ledger that is managed by a network of multiple computing machines in its most basic form. It holds data in the form of cryptographically protected and immutable blocks.
Benefits of Blockchain In Logistics
The advantages of blockchain in logistics are immense. Blockchain will provide a wide range of benefits to this industry, significantly increasing its overall performance. The supply chain, for example, could benefit from blockchain transparency. As a result, all operations taking place within the supply chain would be registered in the ledger and available to everyone.
The monitoring method is another advantage of blockchain in logistics. In practice, blockchain for the logistics industry will provide shipment monitoring from the manufacturing line to the consumer’s side. In addition, businesses in the sector should monitor the location of their products to ensure that they arrive on schedule.
Furthermore, the modular infrastructure has the potential to permanently eliminate all inconsistencies within the ecosystem. While a decentralized system isn’t ideal for enterprise businesses, the features will still help this industry thrive.
The only way it can assist this industry is by speeding up the transaction process. Since this industry relies heavily on prompt payments at any point, a quicker payment will have a significant impact on the production and save a significant amount of time.
As a result, rather than taking days or weeks to make a contract, blockchain allows you to complete it in seconds.
Blockchain for Logistics: Appropriate Use Cases
Blockchain has a wide range of applications in logistics. Let’s look at some of the most innovative blockchain applications in the transportation and logistics industry.
Improved Tracking of Freight
The use of blockchain in logistics and supply chains will make it easier to track down freight. The demand for on-demand and same-day delivery is already on the rise. So, when it comes to logistics firms, it’s a huge problem because they can’t fulfill these rising demands.
Many trucking firms, on the other hand, are now attempting to invest in good monitoring equipment, but the security of these systems is debatable.
Furthermore, since these technologies lack a stable authentication mechanism, cybercriminals or bad actors will still exploit the network’s data.
The blockchain has the potential to drastically alter the situation. No one will now tamper with the data because blockchain has a proper authentication channel with verification.
And, since you can keep track of all the orders and track them in real-time, it can help the logistics industry with great customer service.
Internet of Things (IoT) Device Protection for Increased Efficiency
As you might be aware, many businesses are now using Internet of Things technology to monitor goods to ensure consistent quality. These IoT devices, on the other hand, are vulnerable to cyberattacks because they connect via cloud servers, which is a vulnerable operation.
As a result, blockchain in the logistics and supply chain will provide encryption for these IoT devices while also monitoring all data generated by these devices. It will also assist with the analysis and categorization of all data from these instruments to allow adjustments to the market plan.
Effective Tracking of Transportation
The value of recording shipments cannot be overstated. It’s almost impossible to produce or plan orders on time without adequate monitoring networks. However, it’s a major problem because, in many situations, packages will follow a path that leads to late delivery.
In practice, blockchain in logistics and supply chain will track shipments all the way from the factory to the consumer’s side. In addition, businesses in the sector should monitor the location of their products to ensure that they arrive on schedule.
It may also assist in the purchase of any used car and authenticate details about the log’s previous results. So, as you can see, it’s a big victory for everybody.
Improved Onboarding for Carriers
Blockchain can verify any of the driver information on every new carrier, much as it can validate a used truck. The procedure is lengthy and fraught with complications. Furthermore, since it needs a lot of time, the corporation has some problems with it.
A broker, for example, may exceed a load limit in a particular area. As a result, he or she will classify the new carrier and appoint it, but he or she won’t be able to process it until the career has been fully onboarded. It can exacerbate problems during times of crisis.
However, since blockchain is up to the task, every new driver’s onboarding procedure can be completed in minutes. As a result, the blockchain for logistics monitoring feature will aid in the timely completion of all onboarding procedures.
Vehicle to Vehicle Communication
Another important use of blockchain is vehicle-to-vehicle connectivity.
Many businesses have already begun to incorporate V2V messaging into their systems. As a result, freight vehicles will connect with one another and form a platoon, increasing protection while also saving fuel and time. However, the protection of this data is very poor, and it requires a dedicated maintenance channel.
Blockchain for logistics monitoring options will easily protect all data from vehicle-to-vehicle contact processes and assist businesses in streamlining data. As a result, businesses will use this technology to protect all of their data from cyber-attacks.
Reduced Costing Using Smart Contracts
The use of smart contracts at any point of the logistics process is another excellent example of blockchain in action. As you might be aware, the logistics sector struggles with a large number of transactions at various times. The whole system will break apart if any one of the delays occurs. However, these transfers normally take a long time to complete.
However, if smart contracts are used at any level, the whole process can be streamlined in seconds. Furthermore, eliminating the middleman saves you a significant amount of money. The best thing is that if you start using smart contracts at any level, you can simplify all of the processes from the blockchain.
Now that you know what blockchain is in logistics, you can see how it can drastically change the industry’s landscape. In fact, blockchain is still a young technology that requires further development. Nonetheless, it is completely capable of dealing with all of the problems.
So, if you want to use blockchain in your logistics business, you should first learn how the system functions. If you’re new to blockchain technology and want to learn, blockchain certification courses are a popular option, Since they are both short-term and versatile.
The certified blockchain training program curated by blockchain professionals by the blockchain council focuses on the skills and experience you’ll need to get a job, and it’s all bundled into a compact learning module that suits your schedule.
Begin the blockchain journey to new heights for your logistics firm.