Traditional procurement and supply chain processes can be manual, scattered, inefficient and complex. The use of blockchain in procurement can address these issues by making them faster, more organized and cheaper. Procurement involves sourcing, purchasing and receiving goods and services. It’s a key part of supply chain management, but it often suffers from serious inefficiencies. Procurement depends on contracts, agreements and documents like purchase orders, invoices and delivery notes. Many of these documents might be paper-based, and processes can be manual or involve multiple software systems. The above challenges can cause:

• Errors and delays
• Lack of transparency
• Delayed orders and payments
• Inaccurate or hard-to-manage inventory
• Poor communication between parties
• Difficulty ensuring regulatory compliance

Procurement problems can hurt a business by causing supplier distrust, production delays and even fraud. For example, imagine a shipment arrives at a company but is delivered to the wrong department, and the delivery note is lost. The company refuses to pay the supplier, who then withholds future shipments. This could mean the company misses out on meeting a client’s order. Blockchain has the potential to add efficiency, transparency and trust to procurement processes.

Full feature : Why do traditional supply chain processes need blockchain?