Walmart China Blockchain Traceability Platform Go back »

2020-12-14 | Beijing

Walmart China Blockchain Traceability Platform

I. Background

While the food safety situation in China gradually improves, consumer expectations for food safety and quality are also on the rise.  Increased transparency of food supply chain can effectively build up consumer trust and confidence in food safety, quality and authenticity.

At the same time, with the applications of technologies like internet of things (IoT), blockchain, artificial intelligence, smart sensors, among others, the use of traceability systems in food safety and quality management has become more popular.

Walmart China launched in 2019 a blockchain traceability platform to empower its strategy of product traceability. By scanning the QR code, consumers can get information on location changes, transportation process, shipping time, test reports and other details of the product at all stages throughout the supply chain. This significantly boosts consumer confidence and trust.

II. Program

Walmart has strict threshold requirements for the suppliers, whether it is the place of origin, or the packaging and processing factory. Walmart carries out regular product inspection, and has long achieved basic tracing requirements of goods. All these controls effectively ensure the safety of food. However, the numerous links in the supply chain cause information isolation and data fragmentation in both upstream and downstream processes, creating blind spots and information barriers, which hinders businesses from efficient tracing and information checking. At the same time, consumers have no idea if the source and distribution channels are safe and reliable, and hence may feel suspicious of the data collected after an abnormal incident. Therefore, a systematic approach of data system that connects information throughout the supply chain would be a welcomed solution to enable consumer info access.

However, establishing a systematic traceability system is completely different from tracking several batches of products offline. There are many challenges.

Specific challenges include: firstly, while the concept of a food traceability system is simple, a large-scale application is another story, as the food supply chain is very complicated. Secondly, a food traceability system involves many suppliers with multiple sources of supplies, who have different products, production lines and logistics conditions. Moreover, a single point-to-point food traceability system can hardly guarantee the authenticity and invariance of the places of delivery and acceptance. The food traceability system should give full guarantee to the validity and authenticity of the traced information, and the immutability of information after loading.

Walmart China officially launched In June 2019 the food safety traceability platform powered by VeChain’s Thor blockchain technology in cooperation with PwC and VeChain. The platform is the first of its kind to apply blockchain technology to food traceability platform, prompting tracing development in retail and empowering product traceability strategy. In a food-tracing scenario, the blockchain technology helps record on the chain with time chops, and the process info-flow of a product from the producing to retailing, assigning one code for one item, or one batch. Walmart's blockchain traceability platform shares data ports with parties on the supply chain, and at the same time encrypts and stores data and uses distributed ledgers. Blockchain technology, with its features of decentralization and immutability of data, further facilitates the visualization and effective management of the supply chain, improves info transparency, ensures data authenticity, raises cost of data fraud, and hence boosts consumer trust.

Walmart's application of blockchain technology in the food traceability system enables access in just a few seconds to product information across the food supply chain, such as producing and processing, transportation, warehousing, retailing, etc. and keep the information true and transparent. Consumers can look up the full information of the products recorded on the chain, and trust issues are hence solved.

At present, the platform enlisted over 100 products, including a variety of fresh pork, chicken, vegetables, dry goods and other products of Sam's private brands (Member's Mark). More suppliers will join the platform, and give consumers more transparent and reliable product information.

The effective blockchain-based food traceability system designed by Walmart includes applications at web and mobile ends. It can be used at the same time by all food suppliers and  factories. Each product has a unique QR code, with which consumers can scan to get relevant product information, such as the source of supply, location changes, logistics timespan, testing reports and other details.

The platform also enables interaction with consumers through QR codes, to enrich shopping experience and boost consumer confidence with information tracing and supply chain transparency. As Chinese consumers are raising expectations for food safety and quality, the digitization of food tracing information is good means and ways to increase brand value for food suppliers and win trust from consumers.

III. Future prospects

Food traceability has for long been an issue of concern in close relation to people’s livelihood. The immutability nature of data in blockchain makes it possible to record detailed data for food from producing to delivery, which in turn improves consumer trust and experience, thereby increasing their consumption willingness.

Beside traceability, information asymmetry in the supply, circulation, and demand side of food is also a long-term headache. The decentralizing nature of blockchain makes any updates by any parties a part of the distributed ledger, and each participant can receive the updates. Even in the special cases when an equipment gets disconnected from internet sometime, the updates would be posted and synchronized online once the device is reconnected.

Walmart China's blockchain traceability platform will expand to more product categories and explore deeper in its functions and content to make full use of the system, in order to enhance consumer trust in food safety.

The essence of blockchain is a combination of Internet protocols and technologies about trust. From the application point of view, blockchain is a standardized platform that allows multiple parties to access at the same time. On this platform, all parties can manage all digital items, users, and their operations related to the consensus protocol concurrently. The maintenance of the system requires the joint efforts of all parties, including brand owners, manufacturers, distributors, retailers, consumers, regulators and related service providers, etc.. With the ever improvement and expansion of information technology and digitalization, one can expect that the efficiency of the blockchain traceability system will be greatly improved in the future, and more businesses and governments will apply the blockchain traceability in their practices.