Supply chains and logistics have become quite complex today and to ensure that all parts work seamlessly, this industry has now adopted technologies like internet of things (IoT) and Blockchain. These technologies offer the advantages of collecting data from various points and of bringing more transparency in shipment processes.

This article will look at the ways in which the IoT and the Blockchain be utilized to offer benefits to this industry.

Benefits Of Utilizing Blockchain And Iot In Supply Chain Management And Logistics

Transparency: The use of Blockchain technology offers transparency to the supply chain and logistics sector. It can be used to record transactions in a ledger that can show a clear and traceable history of each transaction, about the product, its origin, buyer and seller. This transparency can reduce disputes and build trust amongst various stakeholders. Each transaction or goods movement is recorded on the blockchain, and this data is available to all parties. This kind of transparency proves to be beneficial when supply chains are spread over large geographical areas and tracking goods can be a challenging task.

Traceability: The Blockchain technology creates ledger entries that cannot be changed, and this helps in creating an audit trail that is very transparent. It can be used to record each movement of the goods, from its source of origin to the destination, which makes it possible to track and verify the genuineness of the product at point. This level of traceability is very useful when the supply chains are moving goods across the world and tracing and tracking the products back to their point of origin can be challenging.

Efficiency: Since Blockchain provides an unchangeable ledger that is not stored in one central storage location, it removes the middleman or intermediaries. This helps reduce the administrative costs and increases operational efficiency of the supply chain management. Its use can automate and simplify the conventional record keeping processes, thus making transactions more efficient and faster. The integration of IoT with Blockchain enables companies to track and optimize transportation of goods, including its storage in real time. Blockchain provides the transparency and traceability of goods, while IoT provides real time data that helps in reducing delays and other inconsistencies from the system, which increases the overall efficiency in supply chain management and logistics.

Security: The unchangeable and global nature of the blockchain makes it very hard to alter, since any changes that have to be made would require an agreement from the whole network. Since the records stored on a blockchain cannot be altered or deleted, it gives a very secure audit trail of the procut from its source of origin to destination. The blockchain technology also uses algorithms that provide further layers of security that would make it difficult for unauthorized access to the data stored on it.

Real time tracking: The internet of things like GPS and RFID sensors provide consistent and continuous updates about the goods, and this data can be stored on the blockchain ledger that helps in providing data integrity. The combined use of these two technologies enables companies to observe the status and location of goods in real time. It also provides an assurance that the data cannot be tampered with and is accurate. This enables businesses to provide accurate delivery of goods, with reduced transportation time.

Predictive maintenance: The combined use of IoT and blockchain can prove to be very useful for predictive maintenance. IoT devices are equipped with multiple sensors that can monitor equipment condition in real time, and collect data on the condition and various other parameters of the equipment. This data can then be analyzed to forecast any potential failures that would require maintenance. The blockchain technology at the same time ensures that the data collected by the IoT devices stored on its ledger cannot be tampered with and retains its integrity. This offers the stakeholders a reliable basis for taking decisions on predictive maintenance of equipment. The combination of these technologies helps reduce the downtime and maintenance cost for the equipment which results in increasing equipment lifetime and efficiency.

Inventory management: IoT devices such as GPS trackers and RFID tags relay real time data on inventory levels and its condition. This enables accurate tracking of goods, prevents stock outs or overstocking of goods and increases the warehouse efficiency. Blockchain offers integrity and transparency of data. The technology when integrated with IoT ensures that the stored data remains reliable and tamper proof and enables businesses to optimize inventory management.

Reduced costs: The real time data collected by IoT devices can enable companies to optimize their transportation and storage requirements, which can reduce operational costs. The blockchain removes the need to have middlemen or intermediaries by providing a global transparent ledger, which helps reduce administrative costs. By offering higher traceability and security, these technologies can help prevent fraud and loss, which helps in reducing costs and increased savings.

Final Words
IoT and blockchain technologies are changing the supply chain and logistics industry. They offer better transparency, traceability, efficiency and security in supply chain and logistics. By providing real time tracking, predictive maintenance and enhanced inventory management these technologies increase the operational efficiency for companies. A logistics software development solution provider can leverage these technologies to provide businesses with a competitive edge that can help them create new and innovative solutions. Effective use of these technologies can help drive customer satisfaction and increase operational excellence of the business.

Author's Bio: 

Kaushal Shah manages digital marketing communications for the enterprise technology services provided by Rishabh Software.