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Companies worldwide spent more than US$2 billion on blockchain technologies in 2018 and the expenditure is expected to rocket to around US$10 billion in 2021 according to a report from IDC.
Although bitcoin remains as the most widely-used application of blockchain by far, the finance industry has also been successful in making use of blockchain technology in the past few years. However, the technology has the potential to transform many business processes in a number of other industries as well, including retail.
Decentralizing the digitalization of retail operations
Retailing is a tight-margin business faced with rising consumer expectations, a multitude of logistic challenges and all the difficulties of effective digital transformation.
According to OpenLedger , the most pressing concerns or pain points amongst retailers include:
- Operational inefficiency — Siloing and static record-keeping being major obstacles to integrated and efficient operations management.
- Consolidated omnichannel retail — Consumers demand omnichannel shopping but retailers struggle to overcome data management hurdles and provide them.
- Consumer participation and tracking — Consumer data collection entails security risks, and can be difficult to compile, share and analyze, thus increasing administrative costs.
- Counterfeit prevention — In 2017, the global market in counterfeit consumer goods was worth $340 billion, damaging brands and degrading consumer trust and revenue.
- Quality, provenance, brand — Consumers are concerned about where their products come from, and mistrust brand-generated claims of ethical sourcing and quality materials or ingredients.
- Regulatory compliance — Current supply chain, production and point-of-sale technologies make it difficult to establish and monitor regulatory compliance.
However, blockchain technology can provide innovative solutions for the retail industry by, for example, enabling end-to-end tracking of goods across the entire production and distribution channels that minimizes chances of counterfeit supplies. In a nutshell, blockchain is a distributed database ledger operating over a network of nodes, following cryptographic protocols for data sharing, validation and authentication. The network maintains an immutable chain of ...
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