Right after Financial services, Supply chain management is the most discussed application of Blockchain technology.
Subjects such as trust between multiple parties, automated actions and payments, proving identity, a shared and open database, and a connected network, are key areas where Blockchain technology stands as the sole industry leader.
Forbes notes that the process of moving the global beef supply chain to a shared, distributed ledger could potentially save billions of dollars in the U.S. With blockchain technology, you don’t have to trust that the data is accurate.
Companies with Supply Chain Management needs that are first to act will find themselves at a distinct advantage in the race to control oversight, costs, and logistical efficiencies at scale.
That’s why Current Walmart is to hire cryptocurrency and digital currency product lead, Dole Plans to Use Blockchain Food Tracing in All Divisions by 2025, and why IBM is working on blockchain solutions for food supply chain management.
Problems in Supply Chains
The two great problems are transparency and traceability.
Transparency, for now, is a potential competitive advantage. Soon enough, though, as more brands compete on transparency, supply chain oversight won’t provide competitive advantage, it will be fundamental to staying in business.
Transparency differs from traceability as it involves other key questions consumers have begun to ask such as where was it grown? How was it grown? Were pesticides used in the farming process? Was it sustainably grown? What were the labour sources used? Is it a GMO product? What are the trace ingredients?
According to a report by Foodinsight, 60% of consumers noted that sustainability and social responsibility are starting to impact where they choose to go shopping for groceries and other edible items.
In the case of supermarkets, supply chain management would refer to the transportation of goods from initial pick up to final purchase by the end-user.
Large scale supermarkets currently offer over 50,000 food products, and the traceability of each of the items is becoming of paramount importance to consumers.
According to a report by Oxfam, Tesco and Sainsbury have reported transparency and accountability ratings of 29% and 8% respectively.
The same report notes that Tesco and Sainsbury own the largest market share of supermarkets in the UK with 27.5% and 15.5% respectively.
Consumers care where their food & clothing come from, and how employees are treated every step of the way.
Blockchain Solutions for Supply Chain Management
Understanding that Traceability, Transparency and Sustainability is the goal, Blockchain technology is the most adept tool to provide all three based on it’s unique, distributed, immutable, and cryptographically secure properties.
- Traceability and provenance can help with Food safety concerns.
The ability to track an item backwards and forwards. Traceability involves both tracing the provenance of an item and identifying who and when the item was purchased by the end-user. Customers are now interested in knowing the source of all the ingredients in meals/products. Where products are from, how they were handled, where there are now, etc.
For example, Tesco aims to be a zero-carbon business by 2050, Blockchain’s traceability properties can help Tesco identify business processes with the highest carbon requirements.
2. Crypto payments, Tokenisation & wallets
Since 2020, crypto adoption has been accelerating E-commerce in the UK.
As of March 9, 2021, there are 495 businesses in the Uk that either have a cryptocurrency ATM or offer crypto as an in-store payment method.
Supermarkets can prepare themselves to support customers that would like to make crypto payments, and even use tokenisation as a more effective way to run loyalty programs.
3. Automation between the various members of the value chain
Smart contracts have become widely known as the most effective way to introduce automation into processes without requiring a third party.
Smart contracts could reduce the time spent on paper documentation and phone conversations by automating tasks based on cryptographically verifiable signatures.
As a single source of truth, Blockchain can aid in sharing data between organisations such as WHO, WEF, to show the progress made on previous environmental commitments.
4. Inventory Management
Blockchain technology can be used as a single source of truth to manage in-house inventory and indicate the storage conditions of perishable items, for example, the temperature of the meat storage room.
The Ethereum network has been the network of choice for such firms wishing to integrate blockchain for its powers of oversight, transparency, and excellent security.
The Aventus Network is playing a key role in helping firms with supply chain management needs oversee and manage their entire supply chain at a fraction of the typical cost when compared to using the layer-1 Ethereum Network only.
That’s because Etheruem has significant drawbacks that require a second-layer solution on top of it to give firms the scale, speed, and cost economies they require.
Problems With The Ethereum Network
At Aventus, we love Ethereum. It’s why we built our second-layer solution on top of it. However, Ethereum has become a victim of its own success. Ethereum has scalability issues that make it a victim of its own success.
As the blockchain network of choice for most businesses, its maximum transaction throughput is wildly insufficient in meeting demand. The economics of supply and demand have thus skyrocketed transaction fees making them prohibitively expensive.
Ethereum is an open, public blockchain. It’s perfectly secure for that reason. However, it lacks scalability and speed. At the time of writing, transaction fees can often cost more than $100 per transaction.
How Aventus Makes it Better to Manage Supply Chains on Ethereum
The Aventus Network is a layer-2 blockchain protocol that brings scalability, lower costs, and speed to Ethereum transactions.
The Aventus Network (AvN) solves Ethereum’s problems by letting businesses build on top of the Ethereum network with Aventus’ second-layer protocol. With the AvN, applications can easily work with any other promising blockchain tech, cross-chain, by plugging into the Polkadot ecosystem, building on Substrate.
Using the Aventus Token (AVT) to manage transaction costs, you can manage supply chains, and all the transactions of data necessary to do so, at scale, securely, without intermediaries, for just 1 cent per transaction paid in AVT.
This is only possible thanks to the Aventus Network combining the scalability and speed of a permissioned, private blockchain with the security and interoperability of the Ethereum public blockchain.
The Aventus Network has countless applications from traditional to digital markets.
The Benefits of Managing Supply Chains with Aventus Network
Having launched with more than 18.5m historical transactions to date, and partners including Live Nation France, Vow Currencies, Artos Systems, cashbackAPP and more, the Aventus Network can let you securely manage supply chains with full oversight, transparency, and traceability — at a fraction of the typical cost.
Scale
The Aventus Network (AvN) can theoretically scale to 2,000 transactions per second. This is 133 times more than Ethereum.
Price
The average transaction cost on the Aventus Network will begin at just $0.01 (paid in AVT) and decrease over time. This is 99% cheaper than the average Ethereum transaction fee over the past year.
Speed
The AvN will process a token transfer within 0.13 seconds. This is 100 times faster than the Ethereum blockchain.
Enterprise Grade
The AvN will onboard a minimum of 18.5 million client transactions that have been active in private test networks throughout the past year.
The fact is that nowhere is the pace of technological progress faster than in blockchain. Depending on your rate of adoption, this new world of digital assets — physical commodities digitally represented and transacted on blockchain — your greatest opportunity.
To talk with the Aventus team about how the Aventus Network could work for you, please visit https://www.aventus.io/contact/.
An Aventus Network Case Study
Aventus helped CashbackAPP increase their net margins by as much as 25% in just 6 months in multiple business jurisdictions.
As a business that gives users cashback on purchases, they were able to restructure their loyalty debt obligation on their balance sheet, reduce transaction fees, and improve treasury management while providing customers with more prompt payment.
To talk with the Aventus team about how the Aventus Network could work for you, please visit https://www.aventus.io/contact/.
