For all the confusion and mystery surrounding blockchain, the technology is simple. It’s essentially a general ledger whereby granular contents are spread across hundreds of computer networks, making the “chain” immutable. Originally used for Bitcoin, blockchain is gaining currency in the supply chain.
ShipChain, a logistics newcomer, currently offers blockchain for higher visibility but is eyeing automatic payment upon delivery.
“Everyone knows the cost of freight audit is going up,” says John Monarch, CEO of ShipChain. “We can automate payments based on proof of delivery and have that truthful record of that.”
Since the company was launched in 2017, ShipChain has been featured in major publications such as Forbes. Last June Forbes reported that Anheuser-Busch InBev is “strengthening the last-mile” with blockchain while Starbucks uses the technology to ensure ethical sourcing of its beans.
Verizon, in a “Fourth Revolution” article, illustrates how blockchain can, say, pinpoint the location in which a single salmon is caught, verify if the fisherman lied about whether or not the fish came from an illegal area, and see the salmon’s delivery to the grocery store- all tamper-proof.
While ShipChain’s website cities 2016 FBI statistics showing $30 billion in annual cargo-theft losses, Monarch says the company’s current focus is on visibility, especially with refrigerated products. Blockchain reduces spoilage, cuts costs, and obviates recalls and even potential litigation, he says.
Meantime, however, “The payments piece is still being worked on,” Monarch says. “It will help you get paid a lot faster because we show everyone involved in a transaction during shipment that everything is truthful; this happened at this stage; it’s confirm-delivered, and all the payments should be released immediately.”
Freight audit and payment executives say blockchain’s not quite ready for prime time, although two companies- enVista and Cass Information Services-are members of the Blockchain in Transport Alliance, a consortium whose roster also includes Delta, UPS, and the 3PL Transplace, among others.
“At this point,” says Harold Friedman, Senior Vice President, Global Corporate Development at Data2Logistics, “we see the majority of our clients taking a similar approach: waiting for BlockChain to create a groundswell in the settlement arena.”
Monarch isn’t positioning ShipChain as a FAP competitor.
“We see ourselves more as a facilitator than anything else. Our goal isn’t to make everyone throw all their old systems out; it’s to augment what they’re doing and make it so it’s a lot more visible.”
RoadSync is another high-tech newcomer. The digital payments platform recently passed the $100 million mark in payments processed after just two years in operation, according to an August press release announcing RoadSync’s introduction of Express Deposit.
The release quotes CEO Robin Gregg: “By using Express Deposit, customers will now have access to their funds via a debit card in minutes, not days.