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Blockchain Opportunities in Global Supply Chain

Karl McDermott - Morpheus.Network
Global Head of Business Development

STORY INLINE POST

Andrea Villar By Andrea Villar | Journalist and Industry Analyst - Sat, 11/16/2019 - 11:17

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Q: How aware are companies of the opportunity and benefits that blockchain can bring?

A: In 2018, blockchain was a hot topic among executives but there were few details regarding success stories. However, there are several cases that show blockchain is successful, not only for the people proposing this innovation but for those adopting it. Companies like IBM, Walmart and SAP have developed production solutions.  Walmart, for example, requires all its suppliers to use blockchain technologies. 

Outside the manufacturing sector, where Industry 4.0 adoption has been most visible, I see great opportunities in three sectors: agribusiness, pharma and the luxury or premium segment. These are perfect markets to apply blockchain and IoT due to their international nature. In Mexico, although it has been neglected by other administrations, agriculture production and distribution are in the midst of a digital transformation, which creates new opportunities. Farmers, for example, have a four-day window to pack their tomatoes in Mexico and send them to the supermarket in the US. IoT sensors are used to track temperature and humidity, as well as shock from dropping a case, to ensure that the tomatoes arrive in optimal conditions.

With Morpheus.Network, US Customs and Border Protection (CBP) can validate trusted traders and the history of the carrier, as well as track the origin of the goods through proof of delivery. As simple to use as an Amazon tracking number, we make a trusted digital footprint available for global supply chain managers. This immutable record of truth shows all the information from the moment the product leaves the farm until it reaches the hands of the client and eliminates the need for random checks and inspections.

Q: What is Morpheus.Network’s main target in the agri-industrial sector?

A: Companies in Latin America export about US$50 billion in agri-food products to the US and have enjoyed double-digit growth rates for the past five years. This sector offers great growth potential. In Mexico, the main beneficiaries of change can be avocado, tomato, berry and meat exporters. Beyond growing their distribution in the national market, these companies have the opportunity to sell internationally, as we already have the technology at hand to meet regulatory requirements such as US’ FSIS and Europe’s EFSA. Our goal is to sell our platform directly to the companies selling and shipping their products.

Q: What are you doing to introduce this level of technology among smaller suppliers that are just starting their digital transformation process?

A: Both the state and federal government have an important role in this process. If we want to improve profit margins for all Mexican producers, not only for big companies like Bachoco, but for companies of all sizes, we have to give companies the technological tools to join the 4.0 transformation. We are working on meeting all relevant ministers in Mexico to promote this idea. 

Q: What is Morpheus.Network’s top priority? 

A: We already have a customer base that generates revenue and will continue to look for the right markets with massive pain points to introduce our platform. An example includes product and brand protection, which uses unique item level tracking to identify black market, grey market and counterfeit products. Segments include luxury and premium products such as tequila, health and beauty and pharma serialization where almost 10 percent of the products sold in global supply chains are counterfeit.

Our goals for the next 12 months are to evaluate and enter these markets and be successful. We will look for early adopters for the Morpheus.Network platform and to create a competitive advantage and savings in supply chain OPEX and/or working capital.

Q: What opportunities might result from USMCA’s new trade conditions?

A: The agreement will be advantageous for all three countries because it will lead to a further strengthening of the strategic supply chain for each country. Mexico has favorable climatic, geographic and economic conditions to create the valuable products that North America wants. When talking about fresh food, Mexico is in an ideal position to provide this to Americans and Canadians.

However, Mexico's opportunities are not related to selling the basic agri-foods per se. The country has to transform its value chains to convert basic food items into high-value final products. The real economic benefit will come when the country learns how to position its products around the world and use efficient supply chains to deliver them in optimum conditions.

 

Morpheus.Network is a supply chain SaaS middleware platform seamlessly integrating legacy and emerging technologies. We provide exporters with a digital footprint, providing shipment history and item visibility

Photo by:   MBP

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