Research Outline

Supply Chain, Logistics, and Blockchain

Goals

The goal is to determine the market size of supply chain and logistics, major players and their challenges, use cases of blockchain in supply chain and logistics, and how blockchain is playing a role in trade finance.

Early Findings

Global Supply Chain and Logistics

  • The global supply chain analytics market is expected to reach $9.9 billion by 2025, growing at a CAGR of 16.4%.
  • The global logistics market as a whole is expected to reach $15.5 trillion by 2023, growing at a CAGR of 7.5%.
  • According to Gartner, some top global supply chain companies include Colgate-Palmolive, Nestle, PepsiCo, Intel, Starbucks, Alibaba, and Walmart.
  • Some top risks that supply chain companies are facing include trade wars, raw material shortages, recalls, climate change, and industrial unrest.
  • Starbucks was facing the need to reduce costs in 2019. They performed research that found that they had excessive 3PL spending and fewer than 50% of their deliveries were arriving on time.
  • They transformed their logistics process, streamlining everything into three sections called "plan, make, and deliver", and saved over $500 million.

Blockchain and Trade Finance

  • By 2050, it is expected that blockchain will be used to streamline the trade finance industry by creating digital paper trails of the numerous copies required for each trade.
  • In Singapore, a new blockchain system called Contour will be released in Q2 of 2020. The system will seamlessly process letter-of-credit transactions. Banks are predicting that this system will keep trade finance going smoothly even during and after the current pandemic.
  • IBM is currently working with 14 European banks to create a blockchain network specifically for trade finance. The goal is to allow smaller banks and financial institutions access to trade finance without having to go through the large banks.

Blockchain and Supply Chain Logistics

  • Some reasons that blockchain is transforming the supply chain industry include adding transparency, removing central authority backing, and providing reliability.
  • Walmart uses blockchain in its supply chain to track its food products through the entire process from delivery to sale.
  • Some companies, such as Tomcar, use blockchain technology to pay suppliers in Bitcoin, avoiding the need for regular bank transactions.