Chinese e-commerce company – JD.com and one of the two largest online retailers in Chinahave joined a standard organization BiTA (Blockchain technology for transport alliance). The company declared its plan succeeding to declaration of FedEx to join with BiTA.The JD.com has announced that the company focuses to expand its application of blockchain technology and capabilities with other international companies involved in freight industry such as FedEx, UPS and Penske among others. The company aims to optimize the supply chain, foreign logistics and incorporation of advanced communication medium in coming years. JD.com also look forward to improve alliancesin order to incorporate innovative technologies within the company.
Blockchain technology for transport alliance was formed by transport executives who are proficient in advanced technologies. It is a forum to encourage, educate, and promote in development and adoption of blockchain application in transportation, logistic and trucking industry. The primary objective is to build a forum in order to develop standards for blockchain technology for more than 200 BiTA members in freight and logistic industries. It is being widely used within logistic firms as a potential medium to improve work efficiency with the main focus on digitization of supply chain in a cost-effective manner globally. In accordance with the adoption of such remarkable developments, blockchain technology helps to establish reliable database structures through several participants and improves the dependence on information delivery system, providence and tracking systems.
Blockchain Technology to Fortify Traditional Logistic Supply Chain
Earlier, startups in blockchain technology, Skuchain aligned with NTT Data Corporation and in order to develop logistic supply chains with the integration of IoT (Internet of thing) in blockchain technology. Due to this, the companies are focusing to embed advanced technologies in conventional supply chain and modernize it to meet the futuristic demands in the near future. Moreover, global shipping company Maersk has announced to spin off with the US based multinational technology company, IBM with the integration of blockchain technology. This results to promote its collaboration among its challengers. In order to achieve desired outcome, BiTA board members focusing on its IPR (Intellectual property rights) and license arrangement so that anyone can use open BiTA standards and don’t have to pay. Thus, it will be available freely for everyone among transport industry without having to reimburse any third party around the world.
Such strategic mergers through implementation of technology are likely to provide product identification and traceability in product management for logistic and freight industry. Provision of tracking and security can deliver better visibility and custody tracking throughout the process from production, storage and transportation stage across the cross-border and global trade transactions.
Less Dependence on Sales Reps within Freight Industry
The revenue volumes have been driven by the strong relationships between shippers and carriers in the freight industry. The sales representative for carriers have strong bonds with the shippers to attain a substantial amount of revenue. With the arrival of blockchain technology, freight companies are likely to enter next generation the personal relationships between sales rep and carriers/ shippers will no more hold significance. The strength of the companies will entirely recognized by the carrier’s ability to deliver instant pricing and universal tracking at speed of execution. Blockchain technology is therefore likely to become vital component in shipper request of proposal to augment supply chain. Thus reliance on negotiation with sales rep will be avoided as capacity and price discovery will depend upon large database and machine learning in order to accelerate freight execution.