Why retailers should embrace blockchain

23 March 2018 (Last Updated March 23rd, 2018 16:48)

Blockchain allows shoppers to view a product’s entire supply chain, increasing transparency and giving customers more confidence to buy. It also limits the possibility of retailers suffering from reputational crises such as the 2013 horse-meat scandal.

Why retailers should embrace blockchain
Blockchain can allow retailers to track the provenance of stock, give them greater control over what they sell, and better guarantee food safety.

Blockchain allows shoppers to view a product’s entire supply chain, increasing transparency and giving customers more confidence to buy. It also limits the possibility of retailers suffering from reputational crises such as the 2013 horse-meat scandal.

What is blockchain?

A blockchain is a secure digital ledger – a highly accurate and detailed list of transactions. The application of the technology in food retail is currently limited, but is already being used by French retailer Carrefour to allow customers to have full visibility of the supply chain of its Auvergne free-range chickens including where, when and how they were raised.

Blockchain will be rolled out to eight more of its product lines from March 2018, highlighting Carrefour’s confidence in the technology and potential benefits to grocers.

Data within a blockchain is highly reliable, making it arguably the most accurate and feasible way of guaranteeing product legitimacy. For example, a shopper would not only be able to guarantee their eggs were free range but also the time they were laid, the name of the hatchery they came from and the name of the farmer. For consumers who appreciate ethical supply chains, blockchain will be valuable, and encourage loyalty for retailers using it.

Why should retailers invest now and who is best placed to benefit?

Blockchain can allow retailers to track the provenance of stock, give them greater control over what they sell and better guarantee food safety.

Retailers can identify any cause for concern before items reach the shelves, as they can easily check the farm their food comes from and process by which it was made. This helps them avoid selling contaminated products and reduce the possibility of scandal.

Blockchain would require high levels of investment for a potentially limited return in the short term. However, investing now before the UK leaves the EU could increase shopper confidence at a time food manufacturers will no longer be tied to such stringent food standards, as the EU ban on chlorinated poultry and a number of E-numbers may no longer apply, and the UK will be able to import from countries with lower food standards.

Given that food quality is rising in importance (according to GlobalData’s How Britain Shops survey), retailers need to invest in upholding standards to reassure shoppers.