Although it doesn't show up on a balance sheet, a company’s brand is perhaps its most valuable asset. When a customer purchases a favorite brand, it doesn’t matter if the product is made around the corner or around the world — they know what to expect, every time. Successful manufacturers know this, and they understand that it’s not just the quality of the raw materials that make up their product, it’s also the reliability of their supply chain.
And the supply chain is only getting more complex. With increasing globalization, manufacturers already struggle to manage working with vendors in different time zones, speaking different languages and dealing with different global regulations. As manufacturers increasingly rely on digitization and automation, we’re certain to see the combination of blockchain and smart contracts playing a significant role in protecting trade secrets and ensuring quality and uniformity throughout the entire ecosystem.
Blockchain is the technology that upholds digital currency like Bitcoin, and it enables digital information to be distributed but not copied. Smart contracts are self-executing contracts where agreement terms between the buyer and seller are written directly into lines of code. This article will highlight select features of both blockchain and smart contracts and how they could work in a food manufacturing environment to protect trade secrets, brand attributes and ensure quality during production.
A Bar Is Born
It doesn’t matter if you buy your favorite candy bar (let’s call it JubilationBar) at a movie theater or the grocery store; it tastes incredible. Sure, you could try to make one at home. It can’t be too hard -- the ingredients are right there on the label.
But it’s not that easy. That’s why it’s a trade secret.
There’s a lot more that goes into that candy bar than just raw materials: the quality and quantity of ingredients, the order in which they’re combined, the temperatures for the various steps, the cooling processes — you get the picture. Perfecting the Jubilation Bar recipe took a lot of trial and error. And that was just to create one bar. Ensuring that it gets manufactured consistently in co-manufacturing environments across the globe is tricky. It’s also crucial to the future of the company. If a Jubilation Bar isn’t exactly right, the manufacturer doesn’t want their label on it. They’ve spent a lot of money building that brand — it’s a promise of quality and consistency (and, well, jubilation).
Source: Sunil Thomas, Forbes - https://www.forbes.com/sites/forbesnycouncil/2018/11/09/how-blockchain-could-ensure-supply-chain-consistency/#321a6f893fb7