Blockchain in Supply Chain Management

3 min readMar 22, 2022


What and Why Blockchain Technology in Supply Chain Management?


Does blockchain technology can really help the supply-chain world? What exactly this supply chain and the blockchain technology in this supply chain all about. Does this simply resembles adding new things to the existing traditional supply chain world? Integration of blockchain into this supply chain world can help you to increasing your profitability?

Supply chain management is one of the areas that is heavily impacted and influenced by blockchain technology. Blockchain technology enables efficient ownership and licensing. By the use of smart contract payments blockchain can be utilized to license services, Products, etc. Blockchain provides consensus, which means there is no dispute in the chain regarding transactions by design.

Blockchain Technology

Blockchain is an internet-based technology with the ability to validate, record, and distribute transactions publicly using immutable and encrypted ledgers. It was invented to support transactions in digital cryptocurrency that operates independently from the central bank. It also provides a platform for creating and distributing transactions to thousands of computers linked to networks in all parts of the world. As the transactions are encrypted in blockchain technology, it offers a more secure model than the banking model. The instantaneous transmission via the internet eliminates banks’ clearing process and accompanying costs to transfer money from one account to another.

Supply Chain Management

SCM stands for Supply Chain Management. It is an approach that’s helps us to manage the flow of goods, services, resources and information throughout the process. The supply chain management generally includes, Planning, Information, Source, Inventory, Production, Location, Transportation, and Return of Goods.

Common challenges in supply chain management are:

Lack of Universal Database

Lack of asset tracking

Undue costs

Long Quality analysis process

Customer satisfaction

What Blockchain Technology can contributes to supply chain world?

Traditionally, supply chains experienced a number of issues without blockchain technology such as lack of transparency, increasing losses, poor compliance, high paperwork, etc. However, blockchain technology has excited the IT and supply chain worlds, inspired many articles, and promoted IT start-ups to initiate promising pilot projects.

The technology can ensure increased supply chain innovations and deliver certain benefits such as:

1. Increment in the traceability of material supply chain

2. Lower down the losses related to gray market trading

3. Improve compliance over outsourced contract manufacturing

4. Reduce administrative costs and paperwork

5. Provide transparency of materials used in products and strengthen corporate reputation

6. Reduce public relations risks from supply chain malpractice

7. Ensure stakeholder engagement across the supply chain

How does blockchain can build a resilient supply chain, streamline supplier onboarding, and increase its transparency?

· Using smart contracts, the business conditions can be improved automatically as it provides real-time visibility into operations and the ability to take earlier actions.

· Blockchain-based supply chain solutions can speed up the supply chain management process through the immutable record of new vendor details. The business network participants including buyers and sellers can trust such records. It addresses the time-consuming and manual experience of the participants of the traditional supply chain.

· While distributed ledger provides shared and single version blockchain supply chain solutions and greater visibility to the permissioned participants across all the supply chain activities. Such supply chain networks can be limited by one up or one down visibility.

What are the Blockchain Use Cases in Supply Chain Management?

Enterprise blockchain technology can transform the supply chain with these three use cases:

  • Traceability
  • Transparency
  • Tradability

Case Studies

1. Walmart tested a blockchain-based application to trace pork in China and produce in the US. It authenticates the transactions and ensures accuracy as well as efficiency of record keeping.

2. BHP has introduced a blockchain-based solution to replace conventional spreadsheets to track internal and external samples from a wide range of providers.

3. Maersk and IBM are using blockchain to improve process efficiency and work on cross-border transactions.


Blockchain in Supply chain can help in supply chain transparency, build a resilient supply chain, and supplier onboarding. It improves operational efficiency by mapping and visualizing enterprise supply chains. Supply chain networks can be limited by one up or one down visibility. Improving traceability also adds value by mitigating the high costs of quality problems, such as recalls, reputational damage, or the loss of revenue from black- or grey-market products.

Don’t hesitate to clap if you considered this a worthwhile read!




IOTRIC stands out as a prominent, end-to-end software development firm focusing on MVP and Product development solutions.