UPS turns to blockchain to streamline logistics
United Parcel Service (UPS), an American multinational package delivery and supply management company, is looking into blockchain to create a streamlined service selection system for its global supply chain.
USP applied for a patent in February for a blockchain and distributed ledged technology (DLT)-based system that will route packages, possibly using multiple carriers, across an international supply chain.
Shipping logistics providers need to properly coordinate shipments, optimizing package routing to ensure that maximum efficiency at minimal costs. However, it can be difficult to coordinate logistics for shipments that use more than one logistic service provider transportation network.
The UPS system seeks to smoothen out things by creating an autonomous system that will use a form of “immutable ledger” to automatically route packages. According to the patent, the system will work by first scanning the package into a packaging facility. The system will then choose a route based on the service offerings of network-connected shipping providers. The shipment information is recorded in the blockchain ledger, which allows the system to check whether the service providers are doing their jobs. Customers will also be able to access information about their shipments as well as the records of logistics service providers.
The patent also states that the system could be built to accommodate interlocked DLT networks. These networks will use smart contracts to pay various parties within the supply chain. The patent also states that if they built it on a public blockchain, the system will be able to use decentralized cryptocurrencies like Bitcoin Cash to pay for the transactions.
“Smart contracts may be configured for execution based on various trigger events, information/data parameters, shipment unit or shipment unit conditions… In various embodiments, the smart contracts may be executed by a transfer of value,” according to the patent application. “Accordingly, various embodiments may comprise and/or utilize digital currency/assets represented by ledger entries. Such digital currency/assets may itself have value that may be exchanged for various shipment units, services and/or the like.”
UPS is a global logistics company headquartered in Georgia. The company has been operational since August 28, 1907. Aside from package delivery services, UPS also operates a cargo airline, a freight-based trucking operation and retail-based packing and shipping centers.
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