Shipping Logistics

Streamlining the Shipping & Logistics Industry with Blockchain Technology Solutions

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Shipping Logistics

Shipping and Logistics Supply Chain

The current shipping and logistics industry are plagued with several inefficiencies including a broken and complex supply chain ecosystem. For attaining excellence in the shipping and logistics sector, increased collaboration amongst the actors of the supply chain is required. This would not just optimize the flow of physical goods but will also streamline financial transactions. However, given the fragmented and competitive nature of the logistic industry, significant amount of value remains trapped. This happens largely due to globalization where, large number of stakeholders spread across different geographies result in creation of low transparency, non standardized processes, and data silos. Furthermore, stringent regulations mandating the use of manual processes makes it difficult to track the provenance of goods and the status of shipments as they move along the supply chain, causing friction in global trade.

Blockchain in logistics can potentially help to overcome these frictions and help realize substantial gains in logistics by improving efficiencies and reducing costs. Here’s how:

Better Freight Tracking: The current track and trace system fails to scale up to the increasing consumer demands of improved operational efficiency through use of authenticated data. Blockchain along with IoT can improve supply chain transparency by providing access to validated data as data once uploaded on Blockchain becomes immutable thereby eliminating risks pertaining to data misinterpretation or manipulation.

Standardize Bill of Lading: The traditional bill of lading (BOL) is a document that is issued by a carrier to a shipper and includes details of the shipments’ journey from origin to its final destination. However, it is an inefficient system that involves lot of documentation and verification by each stakeholder. Blockchain does away with the inefficiencies of the traditional system by providing every stakeholder with a single source of truth. Being a decentralized network, it enables direct communication between all the participants without having to rely on intermediaries. Replacing traditional bill of lading using a Blockchain powered system for shipping goods will drive process efficiency while reducing the operational cost across the supply chain for all the parties.

Automating Processes with Smart Contracts: In the logistics sector freight invoices usually contain inaccurate data which leads to invoice inaccuracy, incorrect payment and other process inefficiencies. Blockchain has the potential to streamline the entire logistics and settlement process together with trade finance. Once real-time shipment data is uploaded on the Blockchain, smart contract functionality could be enabled, which in turn can automate the processes once the agreed upon conditions are fulfilled.

Optimizes cargo capacity: Given the escalating demand for inexpensive and efficient delivery of goods, supply chains have to suffer the penalties of inventory pileups. Blockchain – A distributed ledger technology is the right solution as it can do away with Bottlenecks of the existing system while optimizing the storage capacity. Through its’ smart contract functionality, Blockchain can improve communication amongst the participants thereby paving way for frictionless trade. With quicker payments, businesses can ensure that products wouldn’t be held in storage for an extended period than required.

Standardize Payment: By introducing Blockchain in Logistics, inefficiencies of traditional financial system is eliminated. Its’ smart contract functionality could be leveraged for regulating payment processes thereby ensuring direct and quicker payment.

Why Sofocle?

One of the leading players in the Blockchain space, Sofocle offers robust and tailored blockchain based supply chain logistics solutions to businesses across different verticals. For the shipping and logistics sector, the company offers it market ready product ‘sofoChain’ that can help businesses streamline processes, increase operational efficiency, automate administrative operations while reducing cost and discrepancies.

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