determine when and where conditions changed, providing information they can use to address spoilage problems.
Blockchain could also benefit the truck drivers by supporting new payment models, Kennedy said. Drivers are often paid only upon delivery, and at a rate determined by the miles traveled. Blockchain could allow for payment as a product progresses through its journey.
For consumers, blockchain’s value comes from the technology’s ability to convey a product’s history, according to Leonard Nelson, founder and CEO of Raleigh, NC, artificial intelligence firm Navia. The technology can capture what he described as “intangibles” of a product, such as authenticity and environmental friendliness, that if properly documented, can increase the product’s value to both the supplier and the consumer. As an example, he pointed to Adidas, which has partnered with environmental group Parley for the Oceans in an initiative to make shoes from waste plastic salvaged from coastal regions.
Adidas markets its Parley line as premium shoes, selling for between $120 and $180 a pair. The company supports the higher price points with the story behind products, Nelson said. Using a smartphone, customers can scan the heel where an embedded chip has information about the product and its journey from waste plastic to new shoe. This information is maintained by blockchain technology, Nelson said.
In food, blockchain can help where fraud is rampant, such as fish. Nelson pointed to research from the United Nations Food and Agriculture Organization that says an average of 20 percent of fish in retail and catering is labeled and served as the wrong species. Blockchains can give consumers a way to trace a fish to when and where it was caught, providing verification that justifies the price of an expensive filet.
Nelson acknowledged that introducing traceability technology will add to food cost. But he said blockchain can fund traceability because it provides information to those who want to know more about what they are buying and who are willing to pay for those details.
“The idea is to drive context so whoever buys that product can engage with the product,” Nelson said.
Digital ledgers can also help retailers manage how much of a particular item they need to stock during times of peak demand, such as the days leading up to Thanksgiving, according to Parzygnat. Grocery stores typically increase their turkey inventory ahead of the holiday, but blockchain can provide a store with real-time information about inventory, as well as the availability of turkeys from suppliers, he said.
“If I’m starting to run low, I have this network with all of these potential suppliers that I can do a deal with,” Parzygnat said. “You don’t have to keep a ridiculous amount of supply in stock.”
Photo by Flickr user James Daisa via a Creative Commons license
