Role Of Blockchain In The Retail Industry

Nowadays, innumerable existing retailers are practicing blockchain technologies. An increasing number of agencies, organizations, and businesses have begun identifying the potential of blockchain because of the rapid advancement of blockchain technology  & substantial transformations driven by the online retail sector. Blockchain undoubtedly has a key role in the ultimate future of retail. The value of global blockchain in retail market size was $83 million in 2018 and is expected to reach $11.18 billion by 2026, registering a CAGR of 84.6% from 2019 to 2026. And according to the latest report by Market Reports World, the global blockchain market in retail is predicted to grow from $123.1 million in 2020 to $1644.4 million in 2027 at a staggering CAGR of 44.5%. The mentioned statistics clearly state how attentive the retail industries are for integrating blockchain technology into their legacy systems.

How Blockchain Firms Create Better Supply Chain Operations?

In this article,  you’ll come to know how exactly blockchain in retail can assist companies in making better supply chain visibility, encounter duplication, intensify loyalty programs, and improve efficiency in operations. Without much ado, let’s move to have a glance at how far the blockchain is advantageous to transform the scenario of the retail industry………..

Blockchain Technology: How Does It Revolutionize The Retail Industry?

Consumer assurance has significance but needs to be fixed in the retail industry. Well, thanks to blockchain technology helps increase not only auditability, transparency, and confidence in a wide range of business procedures but also offers a way to form trust between payment gateways, customers, and retailers. Besides, it also allows drives to expect price transparency, relevance, and convenience in the buying & selling process.

So, let’s have a look at a few of the ways in which blockchain technology remodels the retail industry-

Enables Maintain the Quality Of Products:-

For tracking where the goods come from and their condition as well as  to prove whether they are genuine products or not, blockchain technology undoubtedly plays a crucial role. It involves IoT- Internet of Things-enabled sensors that monitor perishable commodities and record information on the securest & reliable digital ledger. In case of defectiveness found in the products, blockchain assists businesses in tracking the concerned product not only through the supply chain but also by identifying suppliers, batches, and manufacturers. This way, retailers can rectify every single issue related to the supply chain and recall the products in one of the most convenient ways.

 The number of Internet of Things (IoT) devices globally is predicted to approx triple from 9.7 billion in 2020 to 29 billion plus IoT devices in 2030. Overall the number of IoT devices across all the major industry verticals, namely- retail & wholesale, electricity, water supply & waste management, government, and more, is forecast to grow to more than eight billion by 2030.

 Brings Improvements In Customer loyalty Rewards:-

Nowadays, more and more companies have initiated making investments in the most competitive & customer-centric marketplace. And blockchain is assisting them in making investments in the creation and improvements of their loyalty programs. Loyalty Rewards, the fundamental driver to protect consumers’ data, are helpful in exchanging digital tokens and triggering certain conditions automatically. Ultimately, it’s helpful in increasing efficiency, and protection, reducing costs, and reducing the requirement for centralized management of redemption procedures.

Loyalty rewards programs have been categorized into various types; let's have an overview of them all to determine which one of the loyalty reward programs will work best for your business-

• Tiered Loyalty Programs
• Cash Rewards Programs
• Point-Based Programs
• Affiliate Loyalty Programs
• Card Linked Loyalty Programs
• Fee-Based Programs

Solves Issues Regarding Forced Labor In The Supply Chains Globally:-

According to the recent information given by ILO- International Labor Organization, there is an increase in the percentage of individuals trapped in forced labor from 24.9 million to 27.6 million, which also includes 3.3 million children. Honestly speaking, Blockchain is acknowledged as one of the most reliable solutions for-

• Documentation & verification of the workforce
• Offering stable evidence that the regulators can't audit 

However, blockchain technology does not showcase a magical weapon for solving the long-standing issues related to forced labor, but it assists retail companies in rectifying fraudulent information regarding exploited human resources. Therefore, to create a strong impression of a clean social audit and drive labor responsibility, the implementation of blockchain principles is a must.

Helps In Streamlining Administrative Procedures In Retailers' Back Office:-

There is no other technology as beneficial as Blockchain that enables retailers to consolidate and automate every concerned process in their offices. Blockchain technology involves the use of Smart Contracts to enable retailers and individuals to make payments to freelance contractors after the completion of the project in a quick way. Additionally, this technology is benefactor for-

• Digitizing & tracking repetitive data-heavy admin tasks, like-payroll administration
• Facilitating staff to concentrate more on value-based or creative pieces of work rather than doing boring tasks

Has More Effective & Relevant Payment Systems:-

For retailers who don't prefer to accept cryptocurrencies as the payment mode, Blockchain enables them to take advantage of official as well as updated payment systems. One of the noteworthy examples of the latest payment systems are-PayPal, Visa, Mastercard, and more which assist consumers in purchasing & also make payments in a wide range of digital currencies.

Blockchain has payment applicability outside of cryptocurrencies, as it eliminates the requirement for verification overheads and makes the infrastructure of financial services more profitable than before. In the simplest words, payment systems have a crucial range of expected applications of blockchain technology, namely- the protection of intellectual property, transfer of digital and physical assets, and automated contracts, as well.

Assists In Observing Blockchain's Applications In The Retail Industry:-

Blockchain's applications in the retail industry are boundless, as they foster customer trust & loyalty or cut out labor-intensive admin. It's helpful in making credible, quick, and more logical consensus between the parties involved. Blockchain also makes it possible for retailers to keep wholly accurate records as well as track inventory in such an industry where all of these steps are significant. As blockchain technology matures, it allows businesses of all sizes to take benefit from a high level of reliability, transparency, & transaction expertise that only blockchain technology can bring to the retail industry.

How Does Blockchain Secure The Retail Industry?

Blockchain technology is unalterable and a permanent technology.It functions through nodes that have a copy of a digital ledger. Data structures of blockchain technology have inherent security qualities as they are based on principles, namely-consensus, cryptography, and decentralization as well. It allows all the new blocks of information to connect to the previous blocks in a way that becomes impossible for any outsider to tamper with.

Are you curious to know in which way blockchain protects the retail industry? If so,taking all of the things into account, let’s have a look at the ways how blockchain provides security to the retail industry-

Helps Companies To Prevent Fraud:-

According to the 2023 Identity Fraud Report, it is estimated that the current worldwide financial cost of fraud is $5.38 trillion (£4.37 trillion) annually, which is 6.4% of the world's GDP. In this context, Blockchain, an incorruptible digital ledger of data, offers a multitude of obvious benefits. For instance, this technology enables companies to put invoices on the Blockchain so that they can protect themselves from acquisition fraud and ensure that invoices will not change between purchasers and supplies. This way, Blockchain verifies the transactions of all parties and helps them in minimizing fraud.

Involves An Effective Inventory Tracking System:-

In the retail industry, inventory management has a critical role to play. It refers to the process of monitoring all of the inventory that the retail business owns. With inventory tracking, it becomes possible for retailers-

•  To track the data related to stock levels
•  Watching locations of the stock
•  To maintain the accuracy of the inventory
•  To figure out the carrying costs
•  Calculation of the value of unsold inventory
•  Better visibility of the stock
•  Forecast the inventory in a better way
•  To track the multiple locations in a single platform
•  Detection of errors fastly

Manages Information Related To Consumers:-

 

The need for the most effective consumer data management is the key factor responsible for the adoption of the General Data Protection Regulation in the E.U. as well as the California Privacy Rights Act in the U.S. Now, organizations have started focusing on accumulating data of consumers more than ever, and handle it with responsibility as well.

To enable consumers to store their every personal information outside of the organizational databases, blockchain technology initiates a decentralized identity system. This system is made of 3 pillars that are-

It’s possible for the users to use DID technology to apply for increasing the traceability of the supply chain, issue fraud-proof certifications, and manage the IDs of employees. So, the use of DID technology instead of using an email address helps in reducing the chances of tracking the web activity of a user and creating a full-fledged picture of the user by not only accumulating  but also correlating information imputed across a plethora of distinguished sites.

 Benefits Of Blockchain In Retail: What Are They?

Blockchain, a distributed ledger technology, is a worldwide phenomenon that will transform every individual’s business. It has transformed the way how everyone transacts & exchanges values across borders. Blockchain is one of the most emerging technologies worldwide today that assists you in making improvements in your business procedures, making things more efficient than before, and also streamlining your operations as well.

Do you want to know how the blockchain journey will transform the way of doing business in the retail industry & other industries? Here are a few opportunities provided by blockchain technology to retailers-

Provides The Retailors With Remarkable Insight:-

In the retail industry, blockchain allows retailers to track every move of their customers, whether it's online or offline. This way, it assists the retailers in offering the buyers extraordinary common sense in their purchasing behavior.

Grants A Secure And Transparent Way To Transfer Money:-

Blockchain in the retail industry is an approaching technology that offers a safe and transpicuous mode of transferring money between individuals, businesses, and companies. Besides, it also assists merchants' stores as well as retail businesses with their information securely on the decentralized network, so they need not share this confidential information with third parties anymore.

Enables to Store Information & Transactions Sefely:-

One of the most interesting things about blockchain is that it's used for accumulating data & transactions in the safest way. It also provides individuals with different loyalty programs that allow for value exchange between parties without the interference of any intermediary. In addition to this, retail companies also make use of blockchain technology not only to increase their reward point but also to  reduce costs.

What Are The Major Factors That Impact The Cost Of Blockchain Development In The Retail Industry?

The cost of developing a blockchain app in any industry depends upon not only a single factor. It involves several factors that enable you to analyze the worth of blockchain implementation in the retail sector. Here are a few factors mentioned- below that you can consider getting familiar with the cost of blockchain development in the retail industry and to know how to start  blockchain retail business -

• App features
• Complexity
• Type of blockchain, a blockchain platform
• Other technology stacks

Before looking at the cost of implementing blockchain, here are a few questions that are a must for you to look into very attentively:-

• Are you in need of building a new blockchain product or integrating blockchain technology with an existing product?

• What sort of blockchain hosting will your product need? –1.) Private Blockchain 2.) Public Blockchain

• Does your app need to deal with monetary transactions?

• Does your product require cloud computation outside of the blockchain network?

• What kind of product interface do you need? – 1.)Web Interface 2.) Mobile Apps 3.) Admin Interface or all of these interfaces.

• Are you in need of a Proof of Concept?

• How many users will communicate with your platform?

 Estimation of the cost of a blockchain app on the following scenarios:-

• Mechanism
• The Intricacy of a Blockchain App
• Development Resources

Mechanism

 

Cost Of Consultation
Development &  Maintenance Cost Designing Development  Migration Quality Assurance Deployment & Cost Of An Intermediary Maintenance Cost

Consulting:-

Consultation services play a vital role in creating a blockchain app in the business. These services generally refer to offering expertise and strategic advice to the client via exchanging opinions or prescribing a piece of advice at a conference or a meeting. In addition to this, these services involve advisory as well as implementation services that are helpful in the decision-making process regarding implementing a blockchain app in the retail industry.

Development &  Maintenance:-

• Designing:-

The cost of a blockchain app varies depending on various factors and the designs of the application. It includes-blueprint of the system, user experience, user interface, wireframes, high-dependability designs with a prototype, low-fidelity designs with application flow, and more that contribute to changes in the cost of an app.

Development:-

This phase involves- coding of apps & testing too. Professional blockchain app developers typically have the required coding skills, familiar with specialized tools to develop an app and environment as well. The cost of development of a blockchain app depends on your choice, which means if you have come up with an idea to create a highly polished app for the retail industry, you’ve to hire an experienced app developer.

When the developer designs your app as per your requirements, he finalizes the cost to take from you. After the completion of making the design of the application, it’s time to test the blockchain application. It involves analysis of applications- for functionality, visual appeal, usability, and consistency across multiple sectors of the retail industry.

• Migration:-

Migration of a blockchain app offers a chance to analyze whether the application is adaptable to its operational challenges and for making improvements too. However, migration enables apps to offer ample services and reduce operational burden, but it may lead to an increment in the cost of the app.

Simply saying, blockchain application migration is the procedure of moving software apps from the existing solution/ computing environment to the blockchain platform. The cost of migrating a blockchain app entirely depends on the size of the application. If the app is small, medium, or large, its cost will vary according to that.

• Quality Assurance:-

Quality assurance has much significance in the process of developing a blockchain app for the retail industry. It is helpful in preventing bugs or defects in apps and improving the quality of the app. While making a blockchain app, it’s essential to carry out quality assurance so that in the absence of quality assurance for blockchain apps, you may need not confront any sort of problems.

The cost of development of a blockchain app relies on quality assurance, a systematic process helpful in determining whether the app will meet your specified requirements or not. Precisely saying it has great importance for establishing and maintaining requirements to develop or manufacture a reliable blockchain app.

• Deployment & Cost Of An Intermediary:-

The cost of the blockchain app depends on the deployment phase, which involves the process of adding and updating applications for one or more users or systems in a particular organization. Deployment is the final step in the blockchain app development life cycle that delivers the final app to the customer. After the deployment of the app, the app is ready for the consumers to use.

• Maintenance Cost:-

Blockchain technology is new to the retail industry, and new platforms are entering it every day. It leads to switching to the blockchain app to retail and other platforms as per the flexibility, scalability, and confidentiality. New updates are released by various blockchain platforms every year, so it will be better for you to hire a developer to maintain all the new updates and enable the app to run smoothly in the retail industry. The cost of maintenance of a blockchain app can cost between 15-25% of the overall cost of the project, which can vary in accordance with the complexity of the app.

Complexity of a Blockchain App 

 

Blockchain Apps with Low Complexity

Blockchain Applications With Medium Complexity

High-Complexity Blockchain Apps

 

The cost of implementation of a blockchain app depends on how complex your project is. There are numerous factors that define the complexity of your blockchain project. If you want to understand the type of blockchain app that you are in need of, you’ve to be familiar with-

• The purpose of your app
• The problems end-users are confronting
• The requirement for blockchain solutions
• In which way your blockchain app will bring changes
• And which solutions are in extant

Here is the classification of the three blockchain apps are categorized on the basis of their complexity-

Low Complexity Blockchain Apps:-

Low-complexity blockchain apps generally involve- basic Smart Contract Development Apps. Payment applications built with existing cryptocurrencies. The developers charge very little money for developing blockchain apps that are less complex as compared to the other ones.

Medium Complexity Blockchain Apps:-

These apps are known as semi-decentralized apps that are built on the blockchain platforms such as Ethereum, Hyperledger Fabric/Sawtooth, EOS, and more. These apps cost more than low-complexity blockchain apps and less than high-complex blockchain apps.

High Complexity Blockchain Apps:-

Complete High complexity blockchain apps are generally built by developers from scratch. Compared to low-complex and medium-complex apps, these ones charge more to the users.

Development Resources

 

Blockchain App Development With In-House Team

Hiring Freelancers For Building A Decentralized App

3.) Hiring An Agency To Build A Blockchain Application

 

Are you in need of a blockchain application for the retail industry? Just hire a team for app development. Hiring app developers contribute to the estimated cost of the blockchain app development. But, one thing that you should keep in your mind is that for implementation of blockchain app in the real world includes expense of providing the developers  with-benefits, vacations, incentive compensation, payroll taxes, and holidays as well.

There are many ways to build a blockchain app  and each will cost differently with a few  benefits and limitations. Do you know the reason behind preferring to acquire a blockchain app built? If not, you need not worry about it too much, as there are so many options for you to build a  blockchain based application mentioned as below-

• Building A Blockchain App With An In-House Team

Building a blockchain app with the help of a dedicated team of in-house blockchain developers is not a cup of tea, as it seems to you; rather, it involves a plethora of monetary issues. This way, you will have full control over the cost of the development of the blockchain app, as you can manage the expenses of the entire team, including- incentives, vacations, workspace, and more.

However, blockchain is in its infancy; still, there is an abundance of experienced blockchain developers with an average salary of $150,000 per annum. In some cases, it happens that for some businesses working with a blockchain developer is more expensive as compared to hiring a blockchain development company. So, it's better for you to work with an in-house team of developers if you're an app development company; otherwise, you should prefer to work with a freelancer or a third party.

• Hiring Freelancer For The Development Of Blockchain App 

If your project of developing a blockchain app is small, the risk factors will also be limited proportionately. In such circumstances, it’s better for you to hire a freelancer for the development of a blockchain app. Hiring freelancers to develop blockchain apps is the least expensive way, but it also depends on the availability of the freelancers, their quality, and their response time. 

• Hiring An Agency To Build A Blockchain App

Hiring an agency specialized in developing a  blockchain app is a viable option for you if you desire to develop a blockchain app for the retail industry. Agencies have the experience to perform the best app development practices and serve as full-time development service providers.

On comparing the costs of hiring an in-house development team & an agency to develop a blockchain app, you’ll come to know that {Cost of hiring an agency < An in-house development team. They sign off the contract before going to start developing a blockchain app as per your need. It allows you to rely on the agency and also concentrate more on the core competencies of your business.

Building a blockchain app is very expensive if it's developed with an internal team. In such circumstances, it's a better option to hire a company or agency that specializes in blockchain app development and can offer you the right cost with 

lower risk.

To Summarize,

At the end of the day, blockchain technology is a subversive technology that can transform various aspects of the retail sector. It’s helpful in making transactions more efficient and securely and also enables acceleration of the entire procedure of customer purchasing. An increasing number of developments are occurring with blockchain, not only in inventory but also in supply chain management, which will surely result in reaching new heights of success. Now, it is clear that blockchain technology impacts not only retail but also has the potential to transform the way individuals do business in other sectors also.

So, whether you have the desire to increase the trust & loyalty of the customers; improve visibility in the supply chain management system; combat counterfeit; or enhance loyalty programs, blockchain is undoubtedly a catalyst for digital retail transformation. If you are willing to stay ahead of the competition or make better business-significant functions, it’s the right time to use blockchain technology.

Blockchain technology is, obviously, the biggest game changer for the retail industry. It assists retailers in deducting costs, decreasing the possibility of cyber attacks, and increasing the consumers’ protection as well. If you’re dealing with the retail industry or have the desire to create blockchain technology-based solutions for customer loyalty programs or supply chain management, without thinking too much, just look forward to partnering with a reputed blockchain development company with recognized blockchain technology experts.