Decoding the Potential of Blockchain Technology in Cold Supply Chain Networks

In recent years, blockchain has evolved beyond initial cryptocurrency and NFTs and is now finding applications across business verticals, notably banking, healthcare, governance and several Big Data-related automation solutions. Cold supply chain is one of the latest sectors to find application for blockchain technology and is already showing promising results! With the rapidly increasing need to create uninterrupted temperature-controlled cold chains, it is imperative that modern solutions utilizing intelligent technological innovations are used to eliminate margins of error and reduce losses.

With the concept of a decentralized ledger made up of encrypted blocks at its core, blockchain offers companies a transparent and secure platform to manage and track inventory as it moves through the supply chain. And smart, digitally programmed contracts automatically enact or document relevant events when specific conditions are met, offering a way for supply chain stakeholders to collaborate and share information (and money) more efficiently. Given the importance of consistent temperature control and monitoring in cold supply chain networks, blockchain could prove to be a game changer. Here are the key benefits of adopting blockchain technology for cold supply chains:

Credibility insurance: Transparency is at the very core of a blockchain-enabled Cold Supply Chain and helps to not only monitor temperature checks and record lapses in real-time, but also build a sustainable system that facilitates decentralization and transparency of all data, thereby helping to build a robust network. This is particularly beneficial in the case of pharmaceutical supply chains where many counterfeit medicines and counterfeit vaccines and pharmaceuticals tend to bypass manual checks. Blockchain helps to not only weed them out, but also identify the exact source and thus create transparency and credibility.

Quality assurance: One of the main benefits of adopting Blockchain technology is the precise traceability of the process, which means that it is possible to trace the exact movement of goods, from the starting point to the end, thus ensuring credibility and quality assurance throughout the food supply chain . Typically, the conventional cold supply chains are marred by lapses in record keeping and identification of the source of a problem, in case of crises. So when food is spoiled or vaccines and medicines become ineffective due to inadequate temperature control, it can become a challenge for companies to decipher the lapses due to poor record keeping and conventional traceability methods. In addition, the process can take weeks and further affect a larger number of products or lots, rendering the supply chain inefficient for that duration. Improved traceability due to blockchain makes it easier to identify and weed out inefficiencies, manipulations, human errors or other unfortunate events in record time, thereby reducing losses.

Improved efficiency: With increased traceability and transparency, it is possible not only to eliminate inaccuracies and errors, but also to remove dependence on manual processes. Although digitizing supply chains handle large and sophisticated databases, the process can often be overextended due to intermediaries. Leveraging blockchain can help enable smart contracts that help eliminate dependencies on manual documentation, thereby improving end-to-end efficiency with digital records.

Bettor ROI: With effective traceability and transparency that helps remove operational inefficiencies, blockchain helps reduce losses arising from damaged products, thereby improving profitability. With blockchain, companies will also be able to establish first-class product quality over a longer period of time, thus resulting in a higher return on investment.

Improved customer experience: With improved product quality due to efficient cold storage and transportation, blockchain also helps in providing consistency, timely deliveries, better costs and thus improved products. In addition, with live tracking and timely updates, capturing important product-related information, inventory management and customer feedback, it is also helpful in building effective customer engagement that can lead to better customer satisfaction. IoT and Automated Efficiency: Apart from driving efficiency, profitability and improved customer experience, blockchain also enables logistics and supply chain professionals to adopt IoT-driven technological innovations and automation across the network. From smarter storage and inventory management to data-driven predictive analytics and smart last-mile deliveries through temperature-controlled devices, to real-time tracking, integrating blockchain technology with Internet of Things (IoT) devices can transform the face of cold storage, end-to-end.

While blockchain initially gained popularity mainly to remove dependencies on centralized third-party entities and bring transparency, it has now become synonymous with driving excellence. Even as we struggle to contain the huge logistics costs and massive food wastage due to inadequate cold storage and transport infrastructure, India’s dream of becoming a US$5 trillion economy by 2024 would be difficult to achieve without a robust technology-driven transformation. However, fundamental challenges such as the cost of implementing blockchain and the lack of integrated platforms and networks that can work to create a holistic impact on improving cold supply chains are important aspects to work on.

Despite these challenges, with data-driven insights and integration with AI, IoT and other emerging technologies, blockchain is emerging as a strong enabler to create robust, efficient and truly unbroken cold supply chain networks, beyond the boundaries of time and geography. And it is high time we embrace this, so that we can truly emerge as a global economic power.

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