CargoSmart is the technology provider for one of the big trade blockchain networks that includes five of the top ten shipping carriers. The company collaborated with Kerry Logistics and Deloitte to successfully connect multiple distributed ledger technology (DLT) networks in a Proof of Concept (PoC) that completed in December 2018. As a result, the benefits of digital document exchange and tracing can be shared through interoperability between the different networks.
Hong Kong-based Kerry Logistics has more than 32,000 employees, and its 2017 turnover was more than $4 billion. 94% of its facilities are based in Mainland China, Hong Kong, Taiwan and Asia.
The project aims to enhance the efficiency of the shipping industry. Indeed, digitizing documents could have a massive impact on logistics and trade. DLT and digital methods will remove the need for inefficient paper systems while a shared source of data will mean that proof-of-origin checks, bills of lading and approval processes can all be faster.
Furthermore, DLT can also significantly reduce fraud. Document fraud currently accounts for 40% of maritime fraud and having documents verified by DLT make them extremely difficult to manipulate without authorized access.
Kerry Logistics sees this as the first step in a supply chain revolution: “When we eliminate redundant processes, we can bring new benefits to our customers and to the planet, which has always been one of Kerry Logistics’ beliefs. Blockchain is more than cryptocurrency, it is the future of logistics, especially when Internet of Things applications are put to use,” said Wilson Lee, Group Director of Information Technology, Kerry Logistics.
He continued: “Kerry Logistics sees it as the solution for ultimate supply chain optimization and is trying all means to be in the vanguard of this revolution. The implication of this POC with Deloitte and CargoSmart is significant, as it defines a new agenda of the next digital age in our industry. The ones who set the ground rules will be the leaders for the next era.”
Deloitte agrees: “A healthy logistics ecosystem is paramount in global trade, but complicated documentation has been a structural problem,” said Deloitte Asia Pacific Blockchain Lab Leader Dr. Paul Sin. “This pilot project has proved that openness to cooperation and tech interoperability are pivotal factors for success, and we look forward to seeing more similar cross-industry collaboration in the DLT space in the future.”
CargoSmart acknowledged the importance of interoperability. “In this project, we proved the network-to-network interoperability and demonstrated the cross-industry collaboration. With a single source of truth, it simplifies the documentation process and accelerates the data exchange across multiple parties, creating a better end-to-end supply chain journey for users in the near future.”