There are many benefits to using blockchain in retail. Some of these benefits are proprietary and only possible if the industry starts to use the technology. However, with the help of blockchain, the industry could soon overcome all hurdles in no time. Join Tech Town to find out what these benefits are through this article.
An important task for retail businesses is inventory management, as this affects overall efficiency. Good inventory management will help businesses keep track of products, shelf life as well as consumer preferences.
Blockchain applications in the retail market can help businesses manage inventory more efficiently. Moreover, Blockchain will also save businesses a lot of money, as it can automate the process of product shortages or surpluses based on consumer demand in real time. We can affirm that this is the best application of Blockchain in the retail industry.
Pay with Cryptocurrency
Everyone knows that the cryptocurrency market is exploding right now. Furthermore, many countries are eager to work and transact on central bank digital currencies, which are in fact a digital currency version of fiat money.
It can be seen that cryptocurrencies will become the currency of the future. Now, retail businesses can go one step ahead by establishing a full-fledged payment channel in cryptocurrency. It is a good strategy to stimulate consumers to use cryptocurrencies, help them pay for products with digital currency and is transparently guaranteed.
As we all know, most of the retail businesses use a typical client-server network model, which is very vulnerable to attacks, and very easy to manipulate customer data to access. access credit card or bank account information. This is a serious breach of privacy.
To solve this problem, retail businesses can use Blockchain technology to secure customer data, put in place authentication processes in the system, and store it all in immutable storage. . Customers will only have access to their information and no third parties can hack and use it.
Streamline sales tax
Every year, every retail business must pay taxes based on their sales. However, many companies tend to avoid paying this tax, which amounts to billions of dollars! In particular, this tax avoidance often occurs in online retailers.
Blockchain is the right candidate to solve this problem, automated sales tax collection on the blockchain platform can help collect taxes based on sales volume or profit. What’s more, retailers can upload their documents, which will be properly verified online. This is really a great way to file your taxes on time and avoid any legal problems.
Prevent counterfeiting and fraud
The reality is, the retail industry lost $62 billion in 2019 solely to fraud. Furthermore, large retail companies have lost nearly 30% of their profits due to their lenient return policies and high profit margins. The problem here is not the loss, but the damage the business incurs by keeping counterfeit products for sale.
Using blockchain technology, retailers can track their goods from manufacturers and ensure that they always receive authentic products. Moreover, this can help them deal with counterfeit products.
Products always have clear origin
One of the other features of Blockchain that can be applied in the retail industry is product origination. Consumers today are skeptical of everything they buy, of course. But retail companies are often unable to provide any provenance other than the “made in…” stamp printed on the carton.
So, when using Blockchain, businesses can provide provenance as consumers can track a product’s journey or the entire supply chain of a product. Customers will be more than happy to spend their money on a really good product.
Provide product contract
The lack of maintaining a suitable supply channel has hindered the development of the retail industry. The reality is, the payment process of a shipment takes a lot of time, including verification and processing. This lengthy process will discourage many suppliers from shipping within the promised deadline, leading to losses for retailers.
Therefore, one of the best features of Blockchain is smart contracts, which help retail businesses as payment security. From there, the supplier will be more motivated to complete the shipment on time.
The retail industry has always faced security threats. This can turn out to be a major security breach resulting in a lot of revenue loss. Most importantly, users may also not trust the business in terms of the security of their data, which gives a bad impression to the brand.
But with the application of Blockchain, enterprises can resist cyber attacks due to the extremely high security protocol of this technology, there will be no more data breaches by a third party.
Implement smart loyalty programs
Blockchain applications in retail can help with loyalty programs. This program is absolutely necessary by helping loyal customers connect with each other and make them happy with their brand. For regular programs, there will be some inconsistent rules that prevent consumers from receiving bonus points.
But with Blockchain’s smart contracts, retail businesses can automate the entire process, pre-program the rules in the smart contract, and when the customer follows all the rules, they automatically get accumulated points for loyal customers.
Direct interaction between seller and buyer
This is a pretty cool feature of Blockchain that many retailers are trying to use right now. There are no additional fees for customers to use other third-party financial services, and merchants can benefit from receiving payments directly without using any third-party apps.
What’s more, this can build absolute trust between both parties, which is a big plus for retail companies.
In short, Blockchain technology will open up great development opportunities for the retail industry if applied correctly. There will be hundreds, even thousands of other positive effects when retail businesses officially apply Blockchain in their business. Hopefully, this information will help readers understand more about the technology of the future – Blockchain and its great applications for the retail industry.
Tech Town is a technology company from Vietnam, specializing in providing technology solutions with the application of the most modern technology techniques such as Blockchain, AI, machine learning… Tech Town is also a professional outsourcing company that has established a reputation for excellence. Previously cooperated with partners from many countries in the world such as: Netherlands, Japan, Australia, United Kingdom, New Zealand, Singapore.
Contact us if your business faces any technological obstacles.