The future of procurement: Blockchain Purchasing

Here at Foodbuy, we’re all about transparency. Transparency of cost, information and of course where your product comes from. But we know there’s even more that food procurement companies can be doing to give clients and consumers assurances throughout the entire supply chain.

Take coffee as an example. Where were the coffee beans grown? How much are the farmers paid? How is it distributed? These are all questions that we demand of our suppliers daily. But what if we could take that one step further and share this information with our clients - from farm to fork – via a simple online system.

Karl Atkins, Chief Operating Officer, Foodbuy discusses the role of transparency and blockchain across the supply chain:

Introducing blockchain
Blockchain purchasing is a ground-breaking technology that allows a buyer to understand the full end-to-end journey of a product, ultimately helping to ensure authenticity and traceability throughout the supply chain. It’s a secure, online ledger (or record-keeping system) that tracks a product from source (i.e. where the coffee beans were grown) through the entire supply chain. Each subsequent transaction or hand-off, for instance the grinding of the coffee beans, is recorded and used to track every component of the finished good.

The result, absolute certainty of where your coffee has come from, who has been involved and even better for procurement professionals like us… insight into how we can create operational efficiencies.

Blockchain is already revolutionising several different industries, so could food procurement be the next?

• Operational efficiencies. Blockchain can help us to develop more efficient ways of moving product through our supply chain. By tracking each and every transaction, we can make recommendations and improvements that ultimately result in cost savings for our clients
  
  
• Variable conditions. What if you could manage cost based on specific criteria, also known as electronic smart contracts? Most deals agree on a contractual price for a period of time, say a year. In this time, the cost of production, manufacturing and distribution might change. Electronic smart contracts mean the price of a finished production will vary across the length of the contract – helping to ensure a fair price for all – none less the farmer or grower
  
  
• Honesty and trust. Trust is built on relationships and reassurance, but it’s won over by reputation. While we are always looking at innovations which can improve every aspect of the supply chain and drive value for our partners, the most important thing to our clients is clear and transparent information on what we supply and where it has come from. No unwelcome surprises.
  
  
• Greater security. Shared ledgers are one of the safest ways of storing information. Unlike normal databases, there is no central administrator, meaning it is less prone to errors or even foul play. Having a shared ledger can improve and protect sensitive data
  
  
• Consumer engagement. Blockchain offers a unique and valuable opportunity to connect consumers to growers at point of purchase. Think QR codes, social media, POS – all bringing your product’s journey to life through its sustainable credentials

We keep our fingers on the pulse, and it’s exactly these types of innovations that we are always looking to explore and implement for our clients. We’re already using forensic traceability with Oritain in a foodservice first partnership, and now we’re exploring how we can implement blockchain with some of our supplier partners.

If you’re interested in learning more, contact us here for more information.