- A study shows blockchain use in the supply chain of Western Europe could decrease costs by USD 450 billion
- Industrial businesses can expect 25% increase of gross return on capital by 2035
According to a study conducted by Cointelegraph Consulting and Switzerland based blockchain firm Insolar, costs relating to supply chain in Western Europe could be significantly reduced with the implementation of Blockchain technology. With a decrease of about 0.4% to 0.8% and given the high volume of the supply sector, the change would be quite substantial, translating into about USD 450 billion.
The report states:
“94% of supply chain leaders say digital transformation will fundamentally alter supply chain management. In the transition to industry 4.0, industrial businesses can expect a 25% gross increase in (Return on Capital) by 2035.”
The study says that the current processes in the supply chain are unable to provide transparency to track the movement of goods in the chain, and that there exists a ‘visibility gap’. This means that parties in a transaction become prone to various frauds, accountability issues, late delivery, poor quality, lost sales. Blockchain, if introduced in the network, would mean that data of the transactions could be stored immutably, which when coupled with the smart contracts, would provide a new level of business power automation.
Insolar CEO Peter Fedchenkov stated that this new integration of Blockchain into the supply sector need not necessarily mean the rooting up of the existing IT infrastructure. In fact, it can complement the same.
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