Blockchain's Impacts on Logistics, Freight and Trucking
1. Better tracking and communication
In the shipping industry, real-time tracking of consignment plays a crucial role in improving customer experience. They must be aware of the current situation of cargo including every single piece of information. Blockchain is a technology that maintains adequate transparency in tracking and communication. You can keep the customer in the loop so that they can easily monitor the exact location of the package and its condition. Everything involved in shipping including payments, orders and carriers are directly connected to the customer.
2. Smart contracts to eliminate disputes
Payment disputes are the most common issues in the shipping industry because of several reasons such as delay in delivery, an unfulfillment of all conditions or damage during transportation. Blockchain in shipping comes with the technology of smart contracts. These contracts are self-executing programs coded through blockchain. Payment is automatically released when all the terms and conditions are fulfilled by both sides. When the item reaches a specific location safely, the shipment company gets automatically paid.
3. Cost-cutting
Paper-based systems of current times are one of the major reasons for the increased cost in the shipping industry. Another major problem is the conventional banking system. Even the processing and administration cost has risen to 20% recently. Blockchain can reduce the over-reliance on paper transactions. If we use blockchain, it eliminates all administrative steps which are unnecessarily increasing the overall transportation cost up to 20%.
4. Fast processing
When we talk about transactions through blockchain, it means trading in cryptocurrency. As compared to the traditional banking system, cryptocurrency transactions are much faster. Instead of hours or days, transactions within a few minutes no matter from which continent you are making or receiving the payments. Moreover, blockchain also eliminates the formalities of conflicting integration standards. Information is exchanged instantly and remains visible to all parties.
5. Robust security
Every information in the blockchain directory is encrypted securely. It cannot be influenced in any way because of robot programming and transparency. Even if someone tries to make changes in data, the activity will be visible to every node connected within the blockchain. Moreover, smart contracts in blockchain fulfillment also reduce the risk of fraudulent activities. High security with adequate transparency is a unique feature of blockchain that makes it the leading technology of current times in the shipping industry.
The best thing about blockchain is, it is open-source and decentralized. It means you will get better security, high speed in processing and maximum transparency at a much lower cost as compared to the currently available traditional technologies. Along with beneficiated the shipping business owners, it also improves the overall customer experience.
