United Parcel Service (UPS) has joined the Blockchain in Trucking Alliance (BiTA), as a part of the company’s effort to build the next evolution of its logistics network using blockchain technology.
Blockchain might become the future standard in the shipping industry’s operations, as UPS joins other logistics companies considering the technology’s merits.
“The [blockchain] technology has the potential to increase transparency and efficiency among shippers, carriers, brokers, consumers, vendors and other supply chain stakeholders,” UPS director of enterprise architecture and innovation Linda Weakland said, as quoted by CNBC.
According to investment group Stifel, three companies will lead the way in developing blockchain-based solutions tailored for the shipping and logistics industry: United Parcel Service (UPS), C.H. Robinson Worldwide and XPO Logistics.
“In our view, blockchain will combine with the truckload pricing futures market, with data analytics-assisted [and] artificial intelligence-assisted real time matching of loads and empties,” Stifel analyst John Larkin told CNBC.
Widespread adoption of blockchain technology in the shipping and logistics industry would prove beneficial for both consumers and providers. If the blockchain technology is applied as theorized, shipments would become more rapid and precise, and products would be cheaper, thanks to less labor cost involved.
“The theory is that the blockchain-enabled supply chain participants will be able to handle transactions more quickly, more securely, with fewer errors and less labor cost involved in the overall process,” John Larkin added.
Additionally, blockchain technology could yield benefits for software providers, data providers, and trailer-leasing companies. However, some companies might be disrupted by the implementation of blockchain trucking solutions, should they choose not to comply with the standard protocols.
“The potential losers [are those] that choose not to comply with the BiTA industry standard protocols or that choose not to be transparent,” the Stifel analyst said.
UPS seeks blockchain trucking solutions – Image source: Mike Brocklebank/Flickr