Over the years, the delivery of products has made the lives of the customers convenient. With the increasing number of customers demanding for their goods to be delivered, the industry of transportation and logistics thrived.
Although freight brings convenience to people, inconsistencies and payment disputes plagued the industry. Because of the industry’s over-reliance on paper transactions, the value of the processing and administration costs have risen to 20% of the transportation’s overall costs. Not just that, 90% of the companies is also having a hard time matching shippers with carriers, causing underutilized delivery trucks to travel the estimation of 29 billion miles per year. These are just a few of the problems present in the industry.
In the year 2008, Satoshi Nakamoto innovated the blockchain technology for cryptocurrency to solve the problem in double-spending without the help of a trusted authority. This technology is from a branch of mathematics called cryptography – the art of writing codes. And this very technology created 10 years ago could revolutionize the world of transportation and logistics.
Here are ways that blockchain revolutionized freight and logistics:
Better Freight Tracking
Blockchain will decrease the chances of discrepancies in transactions. With this innovation, there will be transparency of data and it wouldn’t be subject to tampering. The reliability of the tracking information also increases – and that is essential in the conservation of perishable goods during delivery. It could also make load boards more reliable. It eliminates the need for a broker because load data could now be authenticated, and it could be prevented from being duplicated.
Increase Efficiency in Capacity Monitoring
One of the issues of the industry is the incapability to monitor the space the cargo would take up in delivery trucks – cargo volume often determines that cost of shipping. With the help of blockchain and the Internet of Things sensors, the cargo volume, temperature, humidity, and location can be monitored accurately.
Monitor Vehicle Performance and Performance History
When companies need to buy second-hand delivery vehicles to cut cost, the blockchain can authenticate information regarding the performance and maintenance history of the vehicle. This would be a reliable way in determining functional vehicles for a lesser price. At the same time, it could also aid in validating new carrier records.
Allow Vehicle to Vehicle Communication
With the combination of the blockchain technology and the Internet of Things, communication between multiple freight vehicles is made possible. This innovation stores and validates data created by the vehicle to vehicle communications, and it helps transportation companies streamline their operations.
Cut Cost Through Smart Contracts
The Company could cut cost not only by availing of the best accounting solution available but also by using blockchain. With this technology, Smart Contracts could help the company save money and eliminate the need of middlemen. In addition to that, this would also help in removing possibilities for error and fraud. Smart contracts are coded to self-execute tasks when a certain condition is met.
With the help of blockchain, the transportation and logistics industries could provide excellent customer service. Not just that, it could also address the present problems in the industry that is hindering customer satisfaction and work efficiency.