4 Ways Blockchain Technology Can Help Logistics

4 Ways Blockchain Technology Can Help Logistics

October 3, 2019

How can blockchain technology help the logistics industry?

  1. Maximization of IoT
  2. Transparency
  3. Smart contracts
  4. Better tracking


If you’re keeping up with recent developments in the tech world, you might have come across the term ‘blockchain’ once or twice (or more). If you aren’t too familiar with it, it is simply a digital ledger or list of records that are interlinked using cryptography.

Without going too deep into the specifics, the development of the blockchain could be the key to solving certain problems that many industries face. This is true even for the logistics industry, which could mean many things for local courier service providers.

This is due to the nature of the blockchain as a record system. It is efficient and easily verifiable by the public (including the very people involved in the transaction). It is also permanent to an extent, which means no one can alter the details of a certain transaction after it is recorded. Having said that, the looming question for most people is, “How can blockchain technology improve my business?”

If you are in the logistics industry or somehow connected to it, there are concrete answers to that question, and you would do well to know how the blockchain can improve logistics. To help you, here are some prime examples.


Maximization of IoT

Maximization of IoT

As a culmination of technological innovation and ingenuity, blockchain and IoT can work together to improve your logistics business or service. If you are also not familiar with IoT, a straightforward explanation is that things such as your appliance and products are also capable of connecting to the internet to send and receive data, hence the name ‘internet of things.’

When used together, blockchain and IoT can be useful for capacity monitoring and quality control in cargo shipments and warehouses.

Monitoring the capacity of a given shipment is important because it defines the cost of shipping. By using sensors that are connected to the internet in shipping vehicles and transport, companies can detect the amount of space being used in a given shipment, determine the costs accordingly, then record it on the blockchain for all to see.

For warehousing and storage, sensors that can monitor temperature, humidity, and space can show how logistics providers are taking care of their clients’ products and commodities. Once this is recorded on the blockchain, it can be proof of quality as well as benchmarks for further improvements in storage management.

In this case, blockchain technology acts as a verification of proper maintenance. It can also function as an immutable record of all documentation that is involved in a given shipping process. This is important because shipments usually undergo many checkpoints and are handled by different companies along the way.

Having accurate data that cannot be modified, but accessible to anyone with authorization, makes it a big advantage for logistics.



In relation to the previous entry, transparency is one of the fundamentals of good business practice. It is always best to keep everyone involved in the business process up to speed.

In terms of shipping goods, the blockchain enables every participant from origin to destination to have access to valuable data and information. And since the data cannot be altered without the agreement of all the people in the blockchain, the possibility of graft and fraud are all but eliminated.


Smart contracts

Smart contracts

The term ‘smart’ is an adjective that is no longer limited to describing people, their phones, and their appliances. Thanks to the innovative application of blockchain in the world of logistics, smart contracts are a new emerging feature that can soon revolutionize the freight industry.

Smart contracts are actions that are programmed through the blockchain that will be executed when certain conditions are met. Think of it as an automated contract.

Here is an example: if a company wants to pay a shipper the moment their goods reach the target destination, a smart contract can be put in place to automatically do the paying when that happens.

This eliminates the inefficiency of using paper-based payment systems that rely on the paperwork that passes through different stages of approval before completing a transaction. By relying on blockchain and computers, the possibility of human error is removed, and precious time and money can be saved.


Better tracking

Better tracking

Finally, on top of its potential to pair up with the internet of things, the blockchain also has the capability to integrate with existing technologies like Wi-Fi, GPS, RFID, and Bluetooth to improve the already useful tracking system being used in the industry today. By doing so, a more responsive real-time tracking system can be created that will meet the continually increasing consumer demand for innovation.


Key Takeaway

As time passes, more and more people will discover new ways to apply blockchain technology to their businesses. Logistics is just one of the many industries that can benefit from it. Don’t overlook the implementation of the blockchain in logistics because there are many positives to be gained.

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