Often suppliers need to spend money upfront to begin the execution of their contract. Once they reach a payment milestone, they are frequently anxious to be paid. But in many complex, global supply chains payment can take weeks or months, putting the supplier at risk and feeling disgruntled.
Built into blockchain technology is something called “smart contracts.” They’re a misnomer because they aren’t a contract at all, rather they are programs stored on the blockchain that can be executed when predetermined conditions are met. Oftentimes they eliminate the need for middlemen to deliver on agreed-upon terms. In the case of our customer, by utilizing smart contracts they could trigger automatic payments to a supplier upon completion of a specific task, for example, documented delivery of a pallet of goods. Leveraging the technology streamlined workflows and made suppliers very happy.