7 Ways Blockchain Technology Is Revolutionizing the Transportation and Logistics Industry

The logistics and transportation industries have been ridden with inefficiency for many years.

A range of problems such as administrative costs and inefficiency, payment dispute resolution, tracking and traceability, etc. have been limiting the potential of supply chains and transportation.

New solutions are employing technological innovations to address these issues. Blockchain technology, for instance, is beginning to transform the business and service models of many industries.

It has provided solutions to most of the logistics and transportation problems encountered, such as the same-day shipping model developed by Volt. Not only are these solutions improving efficiency and saving expenses, but they are also satisfying consumer demands and expectations.

blockchain technology for logistics and transportation

What Is Blockchain Technology?

Blockchain technology is understood as a decentralized database that is shared and distributed across a network.

Information in a blockchain is encrypted as a “block” and linked together with other blocks to form a chain. It is one of the most secure forms of technology and is frequently used in the financial technology industry.

Errors and breaches in a blockchain are easily identifiable. Every block is signed cryptographically. Thus, information in a blockchain can be trusted and verified at any point. Since the ownership of data is shared and distributed, the chances of tampering and inaccuracies are significantly lowered.

Any updates or modifications to the blocks requires the agreement of the network’s participants. Further, all changes made are auditable thereby ensuring safe practices.

Improvements in Logistics

Businesses in almost every industry are exploring the potential of blockchain. The logistics industry has also benefited from the disruptive model of blockchain technology. It has optimized many of the manual processes by replacing them with automated processes. It also provides overall transparency of delivery operations.

shipping and logistics operation

Efficient Operations

The most significant benefit of blockchain technology is the efficiency achieved in the supply chain.

A thorough and secure record of all documentation can benefit the company as well as the logistics partner. Having such a record can save precious time that was earlier lost in the manual documentation of certain processes.

For instance, manual data entry and paper documentation were required for custom processes. However, blockchain technology optimizes this process by recording all documentation on the database, including the customs forms as well.

For shipments that undergo multiple checkpoints, such documentation can reduce the amount of time taken to process the shipment and therefore results in efficient delivery.

Transparency and Traceability

The blockchain makes all the information, records and documentation visible at every stage. In a supply chain setting, such information can be essential to trace the movement (or flow) of goods from the production hub to its destination.

By increasing visibility and accuracy, companies can identify lags, tampering, delays and theft of their products. They can also identify internal fraud that has taken place immediately due to the distinctly altered nature of the blockchain.

Further, visibility is also beneficial to the consumer. They may be more likely to trust companies or delivery services that offer complete transparency over their delivery operations. Anticipated deliveries can be traced and tracked by the consumers themselves.

This reduces customer inquiries which often take up valuable time and resources of the company.

Smart Contracts

One of the aspects of the blockchain, smart contracts are autonomous contracts that self-execute tasks when the preset conditions are met. For instance, if a transaction must be made to a logistics provider once the shipment has been delivered — once the delivery has occurred — the contract immediately performs the transaction to the provider.

Reducing the reliance on paper-based systems can eliminate the risk of delays and errors. Smart contracts also cut down on administrative costs and unnecessary processes, thereby increasing accuracy in a cost-effective manner.

transportation industry

Improvements in Transportation

Blockchain technology also has positive impacts on the transportation industry. It can solve the challenges faced by the industry, as well as minimize any middlemen. The cutting down of various steps and processes is a cost-saving measure that also enhances the accuracy and clarity of information necessary for frictionless operations.

Reliable Load Boards

Load boards are one of the biggest challenges of the transportation industry. Since these are handled by multiple brokers, information is vulnerable to duplication and errors. This causes a misrepresentation of demand.

Blockchain technology eliminates this error with a decentralized network of timestamped loads. This way, transportation companies get a clear and reliable picture of the demand. It also eliminates the need for a broker and connects shippers to transportation companies directly through the blockchain.

Tracking Fleet/Vehicle Performance History

While blockchain technology can provide significant visibility over the movement of products, they can also track the performance of individual vehicles within a delivery fleet.

The potential of securely placing information regarding the performance and maintenance history of all delivery vehicles can lead to a more reliable model of pricing and efficiency.

delivery vehicles

Vehicle to Vehicle Communication

Vehicle to Vehicle (V2V) communications is another way to improve efficiency in the transportation industry. V2V communication allows multiple vehicles to form a network and communicate. It can help a transportation company streamline their operations. Storing this data improves fuel efficiency and safety.

Carrier Onboarding

A blockchain can not only verify records of vehicles but also validate the driver records of a new carrier. It can hold information regarding all the carriers in the transportation industry.

This information is immediately accessible and verifiable through a blockchain. It is also nearly impossible to falsify the information. This can be very beneficial to transportation companies that have identified new carriers and need to assign them with shipments on a priority basis.

carrier onboarding


The possibilities of blockchain technology are limitless when applied to the logistics and transportation industries. It helps in streamlining the complex processes and saves on precious time and resources.

A successful implementation of blockchain technology requires a thorough understanding of its intricacies and applications. Many companies in the two industries have begun incorporating blockchain technology into their business model, to overcome the numerous logistics and delivery challenges of today and tomorrow.

As evolving industries, the logistics and transportation industries must adapt and accommodate in the changing landscape of commercial delivery services and transportation.

Blockchain technology is a game changer that promises to transform the manner in which companies execute their services.