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The global perishable food market is expected to grow to a staggering $150.28 billion by 2028, at a CAGR of 8.1%. The perishable logistics industry is experiencing rapid growth, driven by evolving consumer behaviour and increasing demands for quality, sustainability, and transparency. Today’s consumers are highly discerning about the origin, quality, and environmental impact of the products they use.
Perishable logistics, already complex due to the need to maintain product quality, freshness, and timely delivery, now faces additional variables related to consumer expectations. Tracking these variables manually is nearly impossible for a centralised entity. However, blockchain technology presents a promising solution. Companies like Walmart and IBM have already integrated this technology, yet awareness of its implications and use cases remains limited. Let’s delve into the advantages of using blockchain in the perishable logistics industry.
What is Blockchain and How Does It Impact Perishable Logistics?
The impact of blockchain in perishable logistics is a complex concept that is often misunderstood or misinterpreted. To better understand this, let’s explore a short story.
Imagine a sunny farm in the countryside where Farmer John meticulously tends to his strawberry fields. His goal is to ensure that his strawberries reach consumers in the best possible condition. To achieve this, Farmer John uses blockchain technology to record important information about each batch of strawberries, such as the farm’s location, harvest date, and batch size, on an immutable digital ledger. This ensures that anyone who receives the strawberries can verify their origin and freshness.
Once harvested, the strawberries begin their journey to the local supermarket. The distributor, Sally, uses a refrigerated truck equipped with sensors to monitor temperature and humidity, ensuring the strawberries stay fresh. The data from these sensors is continuously uploaded to the blockchain and linked to the initial information recorded by Farmer John. Upon arrival at the supermarket, store manager Mike can scan a QR code to access the detailed history of the strawberries, ensuring they remain fresh and were transported under optimal conditions.
Later that day, customers began arriving at the supermarket. They were delighted to see the fresh strawberries and noticed a sign that said, “Scan to Learn More About Your Strawberries!” Curious, one customer named Sarah scanned the QR code on the strawberry basket with her smartphone.
To her surprise, Sarah could see a detailed history of the strawberries, including where they were grown, when they were harvested, and how they were transported. She felt confident in buying the strawberries, knowing they were fresh and had been well taken care of. Farmer John’s strawberries quickly became a favourite at the supermarket, and customers appreciated the transparency and quality they received.
This short story underscores the growing importance and potential of blockchain technology in enhancing the efficiency and reliability of the perishable logistics industry.
Advantages of Using Blockchain in Perishable Logistics
Incorporating blockchain into perishable logistics brings numerous advantages, and these three in particular have the potential to transform the industry.
Enhancing Transparency and Trust
Blockchain technology provides consumers with detailed information about the origin and journey of their products. A customer in the US, for example, can view where a product was sourced, how it was shipped, and under what conditions. This transparency helps consumers make informed decisions and builds trust in the product, leading to higher customer satisfaction—a win-win for both consumers and the industry.
Ensuring Safety and Traceability
In the event of a food contamination outbreak, blockchain data enables the rapid tracking of products back to their origin or batch. This capability is crucial for identifying the source of contamination and removing affected products from circulation, thereby containing health hazards. This advantage is particularly significant in light of the COVID-19 pandemic, highlighting the importance of traceability and safety in the food supply chain.
Enhancing Shelf Life and Inventory Management
Blockchain technology provides detailed information about the time of harvest and other critical product details, allowing supermarket owners to assess the shelf life of products more accurately. This can significantly reduce food wastage. According to the UN Environment Programme’s Food Waste Index Report 2021, 17% of global food production is wasted, with 13% occurring at the retail level. By leveraging blockchain data, retailers can manage inventory more effectively and minimise waste.
Despite the clear advantages, the perishable logistics industry has been slow to adopt new technologies, including blockchain. Resistance to change, lack of awareness, and the complexity of implementation pose significant challenges. However, as consumer awareness and demand for transparency grow, major players in the industry are leading the way in adopting this new technology. With time, more companies are expected to follow suit, realising the benefits and transforming the industry for the better.
