Supply Chain

November 21, 2023 - Around 2 mins mins to read

What is a supply chain?

A supply chain is a sequence of steps that a service, product, or commodity goes through before reaching its final customer base. The number of steps in a supply chain varies depending on the production. It includes everything from sourcing 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. The distribution can be local, national, or international, but all the endpoints where the product will go are part of the supply chain. Additionally, the supply chain involves third-party companies that purchase the product for resale.

In essence, a supply chain acts as a detailed roadmap for the progression of a service, product, or commodity from its inception to its final destination in a customer’s home. Depending on the product, a supply chain can be as simple as two steps. However, in modern times, supply chains often consist of thousands of steps, making it difficult to track the product’s development.

This is where blockchain technology and cryptocurrency come into play. Major players in the computer industry, such as IBM, are continuously exploring the use of blockchain technology to create seamless supply chains for various businesses and industries. One of the significant advantages of blockchain in supply chain management is its security. Distributed ledgers, which are an integral part of blockchain, are immutable, meaning that once information is recorded, it cannot be altered. This feature is particularly valuable for recording transactions and storing sales and purchase information.

Alternatively, cryptocurrency tokens can enhance the efficiency of delivery and tracking, which are crucial components of a supply chain. Non-fungible tokens, in particular, can be used to create unique labels that are attached to the goods for delivery. As each non-fungible token is distinct, items become highly traceable, minimizing losses throughout the supply chain.

Blockchain technology offers significant benefits in optimizing supply chains. With the rise of large-scale international productions, supply chain management has become increasingly complex and time-consuming. By leveraging blockchains and crypto tokens, supply chains can be made more efficient, productive, and secure.