Despite the recent technological revolution, shipping still remains a traditional industry, using almost archaic processes. This means losing money, time, energy and opportunities for everyone involved. Most of the shipping transactions require a big number of papers – sales contracts, charter party agreements, bills of lading, port documents. It’s time to bring this industry to 2022. It’s time for the blockchain revolution to change our lives and our industries. It’s time for smart shipping.

Think of blockchain like a membership card to the most selected and exclusive club. If a company uses blockchain, people are more likely to trust it. Already very useful for financial transactions, this technology will help everything to be transparent. Every action has to be validated by everyone who holds a ledger in the chain, meaning that each change to a document in the blockchain has to be validated by all prior changes. So, to falsify a document you have to falsify its entire chain of validation and replace it on all the ledgers. Transforming this industry into a smart, safe, secure and fast one, blockchain technology is going to take the shipping industry by storm, but the potential cost savings is what has everyone so excited. Here is why: 

3 potential uses of blockchains in the shipping industry

The rise of e-commerce is pushing companies to have faster delivery methods like same-day delivery via local carriers. Especially now after the Coronavirus pandemic that pushed us to order online everything from electronics and clothes to food or even our morning coffee. This context forces companies to enter into the fast e-commerce era. This is a big opportunity for blockchain because it could provide the new technology needed to reduce complexity while improving compliance and the integrity of shipping transactions. 

But in order to deliver this fast e-commerce, a company has to think smart and organize efficient. Again another big opportunity for blockchain. Why? Here are 3 potential uses of blockchains in shipping industry besides enhanced carrier compliance: 

  1. Better Customer Experience: Who has not faced a horrible situation of damaged or lost package while in transit?! Maybe the company managed to resolve the problem fast and even redeem itself with a special gift, but the bad experience costed us at least energy and time. And for some of us that bad experience pushed not to order from that company ever again, damaging the reputation of the shipper. To prevent this situations there is blockchain that can keep the customer in the loop by showing exactly where their package is at all times. They would be able to review documentation from the shipper to see the events in the chain of custody and determine where the issue occurred. And this is an amazing thing also for the customer as they are able to make more informed decisions when choosing who to spend their money with.
  2. Cost Reduction & Amplified Security: A lot of money are spent on fees for documentation, procedural delays, discrepancies or errors and all can be avoided by replacing old methods with a blockchain strategy. Plus, because all information in blockchain is encrypted, there is a strong layer of security, living no space for errors or fraudulent activities and manipulations.
  3. Quicker Processing Time and Increased Shipping Route Speed: No more filing or conflicting integration standards. Using a blockchain strategy you don’t have to mail or scan documents to various parties, the exchange of information is instant and procedures which normally could take days or weeks to perform can be done in minutes. Plus, the blockchain strategy is a great opportunity for small shipping companies that have to wait for large carriers to fill up shipments on their trunk lines. In a blockchain system, smaller operators will be able to bid on contracts for certain shipments, introducing greater flexibility into the entire shipping industry.

First steps towards the smart shipping era

Maybe the shipping industry is still using their traditional practices, but adopting the blockchain technology is just a matter of time. Within the next years we will see an organic growth on this level, plus the first steps have already been made.

On one hand we have Mercuria, a shipping and trading conglomerate, announcing that they are working with their two financial institutions, ING and Societe Generale, to adopt a blockchain technology for its trading and shipping business. According to them the current process followed in shipping is archaic and it is expected that the trading and shipping industries will be digitalized more and more within the next couple of years. 

And, together with Mercuria, we have another large shipping company, Maersk, exploring the possibility of investing into the blockchain. They have started a cooperation with IBM in order to build a blockchain system utilized in the container market, where Maersk maintains a leading position. In this case, the blockchain will be used to manage and track the millions of shipping containers, by digitalizing the supply chain process to enhance transparency and security of sharing information among the company’s stakeholders, saving the industry billions of dollars each year.

If you are ready for this new era, ready to challenge the present and embrace the change of the future, then let’s work together to create a better world for everybody. Together, we’ll enhance every process that needs improvement and automate what can be automated. Together we can change the shipping industry and help your business become the best partner for your client. Drop us a line and make Ventivo Group your technological partner!