Their platform collects information about:
- the manufacturer (name, location, technology and equipment);
- carriers (transport, equipment, route, transportation conditions);
- involved parties (name, status, history of cooperation, etc.);
- product (ingredients, shelf life, storage conditions, etc.)
Walmart launched this project to track counterfeit, spoilage and fakes, as well as in the case of force majeure, such as in the case of greenery infected with E.coli, to quickly track the source of infection and infected lots. Provenance, MediLedger and TE-Food startups went along a similar path.
How Walmart uses blockchain in its food supply chain
But this is not the only way to use blockchain in supply chains:
- Maersk and GSBN have created global blockchain platforms that could potentially become the standard for all market participants.
- Alibaba and JD use the blockchain to track the authenticity of food products, baby products, luxury goods and alcoholic beverages.
- UPS is developing a blockchain to streamline billing and workflow.
- FedEx launched a blockchain project to store shipping records to use this data as a source of truth during dispute resolution.
- Tallysticks and Blockshipping blockchains are focused on optimizing cash settlements in logistics and supply chains.
Define use cases for your business and move on according to instructions.
Step 2: Attracting partners to the project
As a rule, about 30 counterparties participate in global supply chains, up to 10 in local ones. When implementing a blockchain in a specific supply chain,
it is necessary to ensure that they all also start using the new technology, since without this the “history” of goods will be incomplete.
If you are a big "fish", for this it is enough to threaten with refusal to cooperate, as Walmart did after the next case of infection of the greens with E.coli bacterium. If your influence is not so great, you need to show partners the benefits of switching to blockchain:
- reduction in the cost and complexity of logistics processes;
- reduced fraud and overhead;
- improving data quality and reliability;
- accelerated production and distribution;
- increase in sales.
If your partners are already using blockchain to optimize supply chain logistics, it might be better to join their project rather than create something of their own. In this case, you will save a lot of money and time, but most likely you will not get a lot of rights with regard to the management and development of the blockchain platform.
Step 3: Define a matching method
When all participants in your sales chains (or pilot project) have agreed, you need to choose a method for reconciling data in the administrative register. It's about blockchain type and consensus algorithm. By type of blockchain, they are divided into:
As for the consensus algorithm, there are also several options. For example, in the Walmart blockchain (Hyperledger Fabric), a separate service is engaged in the formation of blocks. VeChain uses Proof-of-Authority (PoA). The JPMorgan Chase blockchain called Quorum uses a modified version of Proof-of-work (POW). Which algorithm to choose depends on the blockchain platform and the distribution of rights and responsibilities between participants in your supply chain. For supply chains, it is best to choose a private or blockchain consortium, since they are fast and allow you to hide some of the information: financial calculations, the content of documents, and the like.
Step 4: Choosing the Right Platform
Comparison of popular blockchain platforms
Next, you need to decide which blockchain you need. To do this, analyze use cases and understand:
- What processes will be digitized and transferred to the blockchain?
- What information will the blockchain collect and how?
- How fast should the system process transactions?
- What information will be entered manually, and what will come from automated IoT sensors and other sources?
- How many participants will be in the system and what are their roles?
- How will the data be validated?
- To whom and what information will be available?
Having an understanding of which blockchain
you need, you should see if there are ready-made solutions that can satisfy your requests. It will be cheaper and faster. The easiest way to deal with this is by examining the cases of other logistics projects, preferably those whose solutions can be used as Supply Chain-as-a Service. These include SUKU, VeChain, Provenance, ShipChain, and most of the IBM blockchain developments.
If these solutions do not work, then you need to choose one of the universal platforms and optimize it for your project. We are talking about Ethereum, TRON, EOS, Hyperledger Fabric and other blockchains sharpened for launching applications. Here, the best solution would be EOS, since this blockchain is fast, has no problems with scaling, and is customized for work with IoT. Hyperledger Fabric is also a good option, especially if you need to create a private network with several levels of access rights.
Step 5: Developing Smart Contracts
The next step in the implementation of blockchain in the supply chain will be the development of smart contracts. These are computer algorithms for automating formalized business processes and exchanging values, such as money, goods, property rights, information or documents. They speed up and reduce the cost of processes, eliminate intermediaries, and also help fight corruption and the human factor.