What is a supply chain?
A supply chain is the whole chain of activities leading raw materials to a finished product for consumers. It encompasses planning and sourcing of raw material, manufacture of a product, as well as packaging and logistic operations for a smooth delivery to the consumer.
Supply chain management is a common mechanism for tracking the supply of materials to a manufacturer, the manufacturing process, and the process of goods reaching the consumer. Quality management tooling is often used to improve the traceability of products passing through multiple stages and locations, with three goals:
- Minimization of inventory
- Reduction of costs
- Improvement of process efficiency
Problems with food chain management
Supply chains are becoming increasingly difficult to manage because modern production and supply processes are geographically dispersed, complicated, and divided into many independent operations.
Food chain management is particularly challenging because mistakes carry the risk of many quality problems. These problems include:
- Outbreaks of a virus or other issues with food
- Issues with labeling, packaging, or ingredients
- Insufficient sterility in manufacturing
- Issues with certification
- Inadequacy of shipping conditions
- Problems with inventory
Food Chain Management: From agriculture to finished food product
Mistakes in food chain management can be detrimental to the economy and the environment. Blockchain technology can provide a solution for many of the current challenges in supply chain management and will therefore be an essential tool for making economies and business processes safer in the future.
How Blockchain technology works
The primary fundamental element of a Blockchain is a transaction, in which two parties exchange information with one another. This can be the transfer of money or assets, the closing of a contract, or a medical record or certificate that will be saved digitally.
In food chain management, a Blockchain would register each transfer of goods as a transaction, and identify the involved parties as well as all relevant information such as price, state of the product, location, date, etc.
In the verification process, a Blockchain checks if a party has the according rights for the transaction. The test happens instantaneously or is written in to a queue, and is tested later. At this point the Blockchain involves the nodes and verifies the transaction.
The Blockchain then validates the information and groups the transactions in to blocks. It encrypts the blocks using a hash function. Finally, after validating the blocks, it distributes copies of the blocks in the network and to the nodes.
Every node adds a block to the chain in a steady and unchangeable manner and when someone tries to change a block in the chain, other nodes recognize the manipulation and the system eliminates the block from the main chain.
Due to today’s computer technology unauthorized parties would need to invest billions in order to tamper with just one single unit in a chain. Because this is completely uneconomical, Blockchain provides a higher level of tamper security.
The advantages of Blockchain
Because of a very elaborate encryption procedure (the hash function), Blockchain data banks are secure from tampering. Additionally, Blockchain distributes many copies of the data throughout the overall data bank. An unauthorized party would need to change 51 % of all instances in order to successfully forge a data bank entry.
Why Blockchain is made for food chain management
In food chain management, the distributed nature of Blockchain makes it impossible for one party to hold ownership of the data bank and manipulate the data to their own advantage. Due to encryption, the data bank could not be compromised, and the linkage of the elements would make it possible to trace the production process to the very beginning. A permanent history from manufacture to sale is therefore now available.
How faizod is moving the industry with solutions for food quality and safety
faizod is currently working on a innovation project for ensuring 100% food safety, 100% data safety, and 100% proof of origin. The goals and expected outcomes are as follows:
- Prevention of aforementioned quality issues
- Traceability of origin, ingredients, handlings, recruitment, labor and business contracts throughout the whole supply chain
- Savings of 20-40% on administration costs
- Security and privacy of all business data and handlings
- Intellectual property and authorization management (patents, ID, user rights)
- Improvement of business partner and supplier network relations
At faizod we are innovating to help businesses of various sizes and industries achieve more. Our projects assist customers around the globe, helping them to run their businesses profitably, adapt continually, and grow effectively.
To find out more, contact us.
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