Supply chain solutions built on blockchain are turning up everywhere these days. In the early weeks of 2020, for instance:

• Researchers at Auburn University announced they had been working with Nike, PVH, Herman Kay, Kohl's, and Macy's to test a blockchain-based system for tracking products throughout the supply chain.
• Food producers in France, Tunisia, and Ecuador became some of the newest members to join the blockchain-based IBM Food Trust.
• Companies involved in maintenance, repair, and overhaul (MRO) in air transportation formed the MRO Blockchain Alliance to test the technology for tracking and tracing aircraft parts.

How much impact blockchain will have on supply chain management is still up for debate. But this distributed ledger technology already plays an important role in some supply chain operations, letting disparate parties share data in a way that is secure, trustworthy, and tamper-proof. Here are some recent developments.

When products come back

Blockchain can play a crucial role in reverse logistics. Data held in the blockchain can confirm that returned products are genuine, identify the retailer that sold them, and then track items as they are refurbished for resale, liquidated, or sent for disposal.

This is helpful, for instance, when a consumer returning a product lacks a sales receipt. "The retailer could scan a serial number, barcode, or other unique identifier on that product and quickly validate within its internal system that this specific item came from that retail store and company, and when it was purchased," says Pratik Soni, founder and chief executive officer of Omnichain, a technology firm in El Segundo, California, whose supply chain management platform connects trading partners on a distributed ledger.

When the manufacturer receives the returned product, data on the blockchain details the item's history, from manufacturing through sale and return. "Now they can remanufacture that item, replace the motherboard or screen or whatever is needed, validate that it is remanufactured with OEM-grade material, and then prepare it for resale in the aftermarket," Soni says.

Because the data tracks individual items and components, and because no one can alter that data, the blockchain helps protect brand integrity. "A big challenge for brands is how to negate counterfeits and identify when counterfeit product has leaked into the supply chain," Soni says. Organizations use serial numbers to identify genuine product. "Blockchain and the distributed ledger validate that and make it immutable, where nobody can tamper with the life cycle of the specific product," he adds.

When a manufacturer disposes of returned products, data in the blockchain can confirm that it did so sustainably. "You can tie in a certificate of destruction and various disposal practices, especially when it comes to electronics recycling, or even consumables," Soni says. This reassures consumers that the company follows responsible practices.

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