A supply chain is the collection of steps that a product or service needs to go through before reaching the final customer.
In simple terms, a supply chain is the list of steps that a service, product, or commodity goes through before reaching the final customer base. These steps vary in number for different productions. The supply chain includes everything from sourcing the raw materials to their preparation and manipulation in factories and other establishments. Once a finished product is ready, the supply chain continues with distribution and sales. Distribution of the product can be local, national, or international, but all of the endpoints where this product will go are part of the supply chain. Lastly, the supply chain involves any third-party companies that buy the product in order to resell it.
In essence, a supply chain is a detailed roadmap of how a service, product, or commodity makes it from scratch to its final destination in a customer’s home. Depending on the product, a supply chain can consist of as few as two steps. However, nowadays, more often than not, supply chains comprise thousands of steps, which makes following the development of a product extremely hard.
This is where blockchain technology and cryptocurrency come in handy. Big names in the computer industry like IBM are continuously experimenting with blockchain technology in order to create seamless supply chains for various businesses and industries. One of the most important things blockchain brings to supply chain management is security. Distributed ledgers are immutable, which means that once something is recorded in them, the information cannot be altered. This is extremely useful when it comes to recording transactions and storing information about sales and purchases.
Alternatively, cryptocurrency tokens can be used to boost the efficacy of delivery and tracking, which is another key component of a supply chain. Non-fungible tokens can be a perfect vehicle to create labels, which are then printed and attached to the goods that need to be delivered. As each NFT can be absolutely unique, items will become highly traceable, and losses across the supply chain will be minimized.
Blockchain technology proves to be extremely beneficial when it comes to optimizing supply chains. Nowadays, with huge international productions, supply chain management can become an increasingly lengthy process. Blockchains and crypto tokens can enhance the productivity and security of supply chains to make them more efficient.