The fast-moving consumer goods (FMCG) industry has experienced tremendous growth in the last few years, and companies are looking to utilize emerging and advanced technologies to gain a competitive edge in the market. The consumer goods industry has been adopting digital transformation, including automating manufacturing processes, entering online markets, and digitizing their supply chain system. Disruptive technologies, like blockchain, artificial intelligence (AI), virtual reality (VR), and IoT are probably leading a modern age of productivity for consumer commodities businesses. These technologies are boosting innovation, brand growth, internal functionalities, and consumer experience. Blockchain technology has wide-implication in the retail and consumer goods industry, and we firmly understand that long-term sustainable success is only possible through meticulous planning.
WSCF market analysts consider blockchain technology as the most significant transformation synergist, not just for retail and consumer goods businesses but also for other industries.
Shipping and transportation across international borders massively depend on paper documentation and human resources, which in return increases the total cost, processing time, and human errors. With the current COVID 19 pandemic’s austerity and economic disruption, it anchored two presumably scenarios. One pathway leads to a relatively optimistic situation in which the merchandise trade across the world in 2020 would contract by 14%, and another worrisome case in which business would collapse by 33%. As per the WSCF analysts, the market necessitates a push of 2.7% per quarter for the rest of the year to meet the positive/optimistic trajectory, as shown in figure 1. However, in 2018 trade statistics, the world experienced a 3% growth with the value of merchandise goods shipped throughout the world amounted to approximately 19.48 trillion U.S. dollars, and commercial services estimated around 5.77 trillion U.S. dollars.
In today’s world, blockchain is re-defining the ways of doing business, and when collaborating with other emerging technologies, it has produced wonders. Blockchain technology is a distributed ledger technology that provides shared and recorded information representing transactions, contracts, assets, and identities. Every new update is recorded in a block with a timestamp and then added to the chain in sequential order. These entries are immutable, transparent, and traceable, which makes it feasible for the community members to verify authenticity at each level.
Time has given us a chance to re-think our goals, re-structure our processes, and re-define our strategies to move towards the betterment of the businesses.
Every organization requires to replace manual processes with a digital upgrade or digital transformation, upskill existing talent with digital skills and drive innovations with digital at the core. If blockchain provides more transparency, efficient delivery, better quality, and reduced cost across the supply chain, gained benefits can be distributed onto the customer.
Following points to elaborate use of blockchain technology in retail and consumer goods industry:
Blockchain technology provides transparency throughout the supply chain, “from the manufacturing of product and distribution channels to the retailer and end consumer.” One with the help of QR code can scan and see the origin of the goods or the correct location of the manufacturing unit on earth along with information of those labor, which made them including the knowledge of the ingredients and processes of making the product that the end consumer is holding in his/her hand.
We need a set of specific applications that store user data onto a space that is managed by the user. Public data violations are universal, and despite increasing awareness of the necessity for more trustworthy and reliable data security, they don’t seem to be slowing down. There was an incident where 143 million consumer’s social security numbers, addresses, and other data were somehow exposed to hackers and identity thieves. Big companies have accepted to sell consumer’s data to other companies for research purposes, marketing, and other uses. Blockchain enhances consumer’s control over their data assets and cuts out the intermediaries, which increases the value of data for both customers as well as companies.
Counterfeit goods have exasperated retailers and manufacturers for many years with a total loss of 1.82 trillion U.S. dollar till 2020, now hold on to your hats as blockchain technology is an anti-counterfeiting solution for medicines and vaccines, luxury items, diamonds, electronics, and many other products. Commodities can be accredited with blockchain’s digital ledger record, which solves the problem of stolen merchandise that can be quickly recovered. It enhances the consumer’s ability to track purchase history while buying second-hand products and ensures whether a brand initially manufactured the product or not. Any issue occurring with any product or stock, blockchain enables to identify that exact point quickly and issues notification to the accountable authority. Since blockchain is updated in real-time, parties on the network can identify the point where an unsafe product goes into the supply chain, eliminating the counterfeit risk.
Blockchain technology is decentralized, eliminates intermediaries from the system. By using blockchain, retailers can bypass commissions and other high processing fees that affect the price of the product.
Move merchandise warranties from paper onto the cloud via blockchain, keeping them up to date and efficiently transferable. Customers can manage a virtual warranty wallet, saving retailers, and manufactures administrative work.
Blockchain technology provides the option of tracing the product throughout the supply chain system. In other words, improved shipping experience for consumers, monitoring product locations throughout the shipping process with IoT tagging, and managing on-time delivery. No more arguing with shipping companies about the validity and accountability of the delivered product.
Blockchain technology facilitates the use of smart contracts, which help to ease the troubles associated with collection and enforcement under traditional transaction structures. When predefined conditions meet each other, then transactions get triggered automatically. Blockchain technology assists in real-time easy refund management with automated insurance settlements and payouts.
Blockchain provides an unbiased rate and review system that revolutionizes the retail and consumer goods industry. It helps genuine reviewers post legitimate rates and reviews about the quality of the product or service. Those who spend their time improving the quality of the platform by providing their valuable reviews, gain rewards as per policy, thus enhancing efficiency and effectiveness of the system. Blockchain unlocks new techniques to keep consumers on their feet by expanding reward benefits in customer loyalty programs. Blockchain technology improves customer loyalty programs by assigning loyalty tokens on the blockchain network in the most efficient manner. The use of a transparent feedback platform backed by blockchain, where rates and reviews are immutable.