How Blockchain Can Improve Logistics by Sharing Information

Blockchain technology has emerged as one of the major trends in logistics and supply chain management. Every day, more companies adopt blockchain solutions to increase efficiency, transparency, and security in their operations. In this article, we’ll explain how blockchain can improve logistics, from tracking products in real time to automating payments and enhancing supply chain transparency.

What is Blockchain?

Blockchain is a distributed ledger technology created in 2008 by the pseudonymous Satoshi Nakamoto for Bitcoin. Beyond cryptocurrency, blockchain allows secure, immutable, and decentralized data sharing. Each transaction is a “block” linked to the previous one, forming a chain that is traceable and tamper-proof.

Key characteristics that make blockchain useful for logistics:

• Decentralized: All participants share the same data, reducing reliance on intermediaries and lowering costs.
• Immutable: Once recorded, information cannot be altered, ensuring accuracy of product tracking and financial transactions.
• Automatic: Smart contracts automate actions such as payments or inventory updates.

How Blockchain Improves Logistics

1. Smart Contracts for Process Automation

Smart contracts are self-executing programs hosted on the blockchain. They automate logistics processes such as payments, compliance, and approvals without the need for intermediaries.

Example: Walmart implemented a blockchain-based food traceability system in collaboration with IBM. This system reduced the time to trace a product’s origin from 7 days to 2.2 seconds, helping prevent food safety issues and increasing supply chain efficiency.

2. Real-Time Tracking of Products

Blockchain enables real-time tracking of shipments across the supply chain. By integrating blockchain with IoT devices or tracking sensors, all participants have updated information on the location and status of goods.

Example: Maersk’s TradeLens platform consolidates data from carriers, ports, and suppliers to create a single source of truth for shipments. As of 2021, TradeLens tracked 2.3 billion events for 43.6 million containers worldwide, improving efficiency and reducing costs.

3. Automated Payments

Blockchain combined with smart contracts allows instant payments upon delivery or fulfillment of conditions. This reduces delays in transactions, lowers administrative costs, and increases trust among supply chain partners.

Example: AXA’s Fizzy platform automated flight delay insurance payments, instantly transferring funds to customers’ wallets using blockchain smart contracts. Although the project ended in 2019, it demonstrated blockchain’s potential for logistics finance automation.

4. Transparent Accountancy and Compliance

Blockchain provides a comprehensive and immutable record of all transactions, enabling companies to enhance transparency and regulatory compliance.

Example: The Blockchain Tuna Project, led by the World Wildlife Fund, tracks tuna from catch to consumer using blockchain and RFID technology. This ensures legality, traceability, and sustainability of seafood supply chains.

5. Cross-Industry Applications

Blockchain’s features make it applicable beyond logistics:

• Finance: Secure cross-border payments
• Human Resources: Transparent credential verification
• Tourism: Verified booking and loyalty programs
• Legal and Compliance: Immutable contract execution

Become a Blockchain-Savvy Logistics Professional

Mastering blockchain in logistics opens doors to roles like Supply Chain Manager, Logistics Analyst, or Operations Director. At BEBS, our programs such as the Master in Integrated Logistics and Supply Chain or Master in Operations Management and Logistics prepare professionals to leverage blockchain and other emerging technologies to improve supply chain efficiency.