Blockchain in Transportation – Revolutionizing Logistics
Shipping and logistics are spheres full of complicated processes, which slow products’ delivery. DLT is already integrated into some operations, and revolutionary changes can be noticed. How does it work and what are the pluses of decentralized logistics?
What is the principle of work?
With DLT, the transportation becomes optimized and automatized. All necessary documents are changed in their form – they become digital. This transformation allows to share and distribute the data between all parties involved into the logistics process.
What problems does it solve?
To make the delivery services work efficiently and successfully, the most important condition to be followed is collaboration. It is needed between all organizations taking part in the procedure – from producers to the delivery services bringing products to buyers’ hands.
The main problems existing within the industry now are high costs and low efficiency. If DLT is applied, the issues could be solved.
How DLT improves the process:
All data is stored on the distributed ledger, therefore, no information can be hidden. Moreover, the data is updated in the real time which makes it easy for everybody to track the goods’ location and follow the processes.
• Decreased cost
DLT helps to get rid of all paper documents which means that there will be no possibility of loss or duplication anymore. Also, the process eliminates the possibility of making errors.
• Fast delivery
Without paperwork, delivery becomes faster, and there is no need to wait for documents being prepared.
All data is easy to check and verify. With this opportunity, frauds or hacks are impossible.
Real use cases
DLT integration has already shown its results. For instance, such a huge shipping corporation as Maersk uses it for creating the insurance.
Famous Walmart is discovering logistics with blockchain, too. It suggests “smarter package” delivery tracking system – there is a special device recording all data about the package on the distributed ledger.
Smart contracts also played their role in the trial shipping of cotton from USA to China, ensuring the guaranteed payment.
ZIM corporation and Wave have digitized the most important shipping document – the bill of lading.
Apart from that, such giants as Amazon, Alibaba and Kestrel are looking into DLT for delivery services as well.
On the territory of CIS countries, Ukrainian platform A2B Direct was the first to utilize blockchain for shipping.
The more the technology will be applied in logistics, the easier and more convenient it will become. In the future, DLT integration may lead to the complete elimination of middle parties, full control over all goods being delivered and easy tracing of products.
Track-and-trace apps may become very popular allowing buyers to watch the conditions under which their parcels are being delivered and making them sure they will get them in time.
Most importantly, DLT for shipping industry may lead to the creation of innovative business models in the future.
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