Blockchain Technology Enhancing Efficiency and Security in Logistics and Transportation

Blockchain Technology Enhancing Efficiency and Security in Logistics and Transportation

Quick Summary: Blockchain mobile application development is fueling innovation in, igniting transformational change across industries. It is addressing long-standing challenges and revolutionizing logistics and transportation through enhanced operational efficiency, reduced costs, and elevated customer satisfaction. Blockchain is enabling mobile apps to resolve entrenched problems and reshape user experiences like never before.

What is blockchain?

A blockchain is a digital ledger that records an ever-growing list of network transactions in a sequential, linked chain of data blocks. The nodes in the network share and verify the synchronized distribution of this database independently without the need for any central controlling entity. New blocks of data are added to the global blockchain permanently only after they satisfy the decentralized consensus process established by the network.  

The decentralized, unalterable, and inherently secure qualities of blockchains make them an appealing means for direct peer-to-peer exchange of information, such as in logistics systems. Because the network always ensures secure consensus, participants can establish trust between themselves without dependence on an intermediary.

Blockchain mobile application development

Industry Issues That Led to the Blockchain Adoption

Payment Delays and Disputes

A recent study from the transportation sector revealed that $140 billion of funds are tied up daily as a result of arguments over payment. Firms frequently have to wait up to 42 days to get paid, causing millions of dollars that could have been used to improve services to be frozen. These delays and disagreements prevent billions of dollars of capital from being employed, money that might otherwise have been directed toward enhancing services.

High Processing and Administration Costs

The logistics sector traditionally depends heavily on paper-based processes to handle transactions, which results in extremely high costs related to managing and executing these transactions. According to an analysis conducted by IBM and Maersk, even a straightforward shipment of refrigerated goods from Mombasa, Kenya to Rotterdam, Netherlands required coordination across 30 distinct entities and over 200 separate communications. The excessive reliance on hard copy documentation in the logistics industry introduces exorbitant expenses associated with handling and administering these transactions. In a case study tracking a single shipping container of flowers moving from Kenya to Holland, the key finding was that this simple refrigerated cargo passed through 30 organizations and necessitated over 200 distinct communications.

Staying in the Right Temperature Range Is Not Easy

Some delicate international pharmaceutical cargo shipments experience fluctuations in temperature during transit. As a result of these temperature changes, many invaluable biopharmaceutical goods are unable to clear customs because they surpass the acceptable temperature limits, leading to wasted transportation expenses, superfluous administrative inefficiencies, and in most cases, the total loss of the product. According to estimates from the IQVIA Institute for Human Data Science, the pharmaceutical sector incurs $35 billion in annual losses due to non-compliance with prescribed temperature conditions throughout the shipping process.

Less-Than-Truckload (Ltl) Shipping

Connecting shippers with carriers is an intricate undertaking in logistics as the majority of firms possess six or less trucks. This circumstance leads to truck drivers traversing billions of miles annually with incomplete or vacant trailer loads, generating losses of millions of dollars each year. It also elevates shipping expenses for consumers. The data indicates truck drivers in the US typically drive around 140 billion miles per year.

Opportunities Blockchain Brings to the Trucking Industry

Improving Efficiency

The implementation of blockchain technology has the potential to bring about a revolutionary transformation in numerous industries. The realm of freight and shipping is one such industry that can leverage blockchain to enhance its delivery procedures. The introduction of a more efficient mechanism for monitoring goods can heighten levels of productivity greatly. By facilitating quicker and more cost-effective delivery, blockchain can enhance supply chains. It also improves the ability to track goods, fosters improved communication between partners, and, most importantly, simplifies the process of accessing financial resources. Due to its decentralized nature, blockchain eliminates the need for intermediaries in payment procedures. In contrast to traditional financial services, blockchain expedites transactions by permitting peer-to-peer cross-border transfers using digital currency.

Immutability and Security

Blockchain technology enables companies to monitor the transfer of goods through the supply chain. Once products have been successfully exchanged and smart contracts settled, the data is added to a public or private blockchain, along with algorithmically generated signatures that are extremely challenging or impossible to alter. To do this, blockchain utilizes cryptographic hash functions that can be thought of as unique mathematical fingerprints for data. Supply chain transaction information is recorded alongside details about the authors and time of creation. Any party with access to the blockchain can track this data, and it can even be shared with end consumers to improve transparency.

Smart Contracts and Payment Automation

The automated, self-executing digital agreements contained within the blockchain enable instant completion of deals. Smart contracts are standalone and have all required details pre-coded for the agreement to be lawful. The most useful aspect of smart contracts is their mechanization. For instance, a smart contract will automatically dispense funds upon receiving verification that shipping paperwork is in order. Corporations can receive payment promptly after submitting documentation confirming they have the goods. With smart contracts, there is no requirement for manual disbursement of money as the products travel through the supply network.

Theft and Fraud Minimization

The logistics and transportation industry suffered a whopping $45 million loss in 2021 due to cargo frauds and thefts. To combat this issue, blockchain technology can enforce stringent regulations that mandate the submission of legitimate government-approved photo identification documents during pickup or delivery. The use of blockchain ensures that the supply chain process remains secure as all records can only be verified with the unanimous agreement of all parties involved. Additionally, it becomes simpler to track any document back to its initial form and restore it.

Performance Monitoring

Blockchain technology allows for delivery tracking to be carried out through smart contracts. Additionally, blockchains assist in monitoring the historical performance of transporters and vendors. The performance of individual vehicles, like trucks within a fleet, can also be tracked. Blockchain enables the tracking of individual carriers’ performance history by documenting information about pickups and deliveries. This data assists logistics enterprises in making better choices when bringing carriers on board, ultimately enhancing the supply chain.

Blockchain mobile app development

Blockchain Benefits in Logistics, Trucking, and Freight

Data Transparency and Accuracy

A major issue in logistics is the uncertain reliability of data. Supply chain businesses often keep their information private, which is the primary cause of the lack of transparency. While transparency might not be encouraged in competitive markets that see unequal access to information as an edge, there are cases where openness builds confidence and can be competitively beneficial. When this is true, blockchain can have a big effect, since it provides a decentralized and transparent method to manage supply chain information.

Smart Contracts for Fulfilling Agreements

A blockchain-driven innovation, smart contracts are designed to enable automated and legally enforceable agreements throughout the supply chain. By leveraging pre-set protocols, smart contract participants can securely oversee and evaluate the logistics process at all stages. Additionally, smart contracts are instrumental in ensuring transaction compliance while mitigating risks and uncertainties. Notably, smart contracts are particularly beneficial to small businesses, such as startups, which are seeking to establish a foothold in the logistics industry.

Security Through Decentralization

Information security has become an important issue in modern logistics infrastructures. The problem with the existing systems that support the IT functions of supply chain administration is that they are centralized. Since security frameworks are far from faultless, centralized IT structures enable a malicious intruder to have total control once access is obtained. The attackers can theoretically modify or delete any data kept within the compromised system. As blockchains are decentralized, there is no single entry point that can provide a user the capacity to unilaterally make alterations. The complexity of the cryptographic algorithms involved makes it nearly unfeasible for a malicious actor to change the data.

Permissioned Access

Blockchains with permission access are characterized by restricted entry and enforce stringent regulations regarding data accessibility, data broadcasting privileges, and consensus mechanisms. These restricted environments are frequently utilized by multiple entities seeking a shared platform for conducting transactions and exchanging information, such as in supply chain management. Private and semi-private blockchains offer enhanced levels of security in comparison to their public counterparts.

Better Asset Management

A key benefit of blockchain networks is their capacity to monitor assets and resolve disputes over ownership whenever needed. In an e-commerce blockchain ecosystem, every involved party can access data on the products and services being offered as well as associated deals carried out through smart contracts. Once a transaction is finished, buyers can see its complete status. Completed transactions cannot be altered. All participants can view any related updates as they happen in real-time.


Blockchain technology can revolutionize logistics and supply chain operations. The built-in characteristics of blockchain are already addressing critical issues in this area. The transfer of data between suppliers, manufacturers, distributors, retailers, and end-consumers through blockchain networks is extremely secure. Since data that is written into a block cannot be altered, it eliminates the risks of theft and fraud. In summary, blockchain can transform logistics and supply chains due to its inherent security features that enable trustworthy data sharing along the entire chain.
Though blockchain offers many benefits, deploying it in transport and logistics still calls for expertise. Our team at Brain Inventory focuses on building public and private blockchains to improve supply chain and logistics operations. With a proven history of delivering comparable solutions, we’ve positioned ourselves as trusted experts in this area and stand ready to assist you.

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