Is blockchain the answer to retail supply chain transparency?

a high street of shops

As shoppers show a growing preference for ethical brands, could blockchain be the ideal way to build transparency into the retail supply chain?

Gaining customer trust is getting increasingly complex for retailers. Before, trust was earned through good customer service, reliable products, and other standard retail requirements – but that’s changing.

“Five years ago, trust in a company was really that they did what they said they would,” says Rachel Barton, Accenture Strategy’s managing director. “In the last few years, it has moved to trusting the foundations and purpose on which a company is built.”

Shoppers are recognising their power – over 70% of under 30s believe refusing to buy from a company or criticising it on social media can influence its behaviour – and retailers need to respond accordingly. Combine that with a growing social conscience around labour, sustainability and ethical sourcing, and retailers need to start providing transparency in their supply chains to maintain trust.

For a growing number of retailers, this transparency is being enabled through blockchain. This isn’t about cryptocurrencies – though alternative payment systems are of interest for many retailers. It’s about the underlying technology and how it can be used most effectively to encourage a culture of transparency, accountability and trust between brands and consumers.

Honesty is the best policy

Research has shown that 75% of shoppers would switch to a brand that provided more in-depth product information on its labels, while 66% would even pay more for a product that’s from a transparent or sustainable brand.

And it’s not just in-store signage and labels that need to give more detail to shoppers. Information needs to be readily available when they go looking for it, too. With 52% of millennials saying they always research for background information before making purchase (closely followed by 45% of Gen Z and 41% of baby boomers), brands need to ensure they’re being honest online.

If a basic internet search doesn’t give customers insight into factors like ingredients, sustainability, and sourcing, it can even damage their perception of the brand. As Deb Arcoleo, Director of Product Transparency for The Hershey Co., explains: “If people are searching [for information about a brand] and they can’t find anything, that absence of communication is actually communication.”

Essentially, silence can leave customers wondering what the brand might be hiding – even if that’s absolutely nothing.

Radical transparency with blockchain

For retailers that are serious about building honesty into their brand, blockchain is the ideal way to track and document the way their supply chain works. Not only does it enable the transparency shoppers are looking for, it also gives them a secure, verifiable record of a key aspect of their business.

The distributed ledger technology offers two key trust-building capabilities for retailers:

Guaranteeing provenance

Every year, luxury brands lose an average of 20-30% more through fraud than other retailers, due to their high margins and flexible returns policies.

Brands such as Louis Vuitton are using blockchain’s secure ledger to issue each item with a verifiable certificate of authenticity that can’t be copied. This means customers can rest assured that they’re purchasing a real product, and brands can have extra insight into their sales and distribution channels.

For high-end jewellery brands, there’s also an important opportunity to embed ethics in their supply chain, with blockchain being used to certify conflict-free diamonds. Industry giant De Beers announced the first major initiative of its kind in early 2018.


There are a variety of ways blockchain can help with traceability in retail, which is vital for building trust between brands and customers. Let’s look at a couple of examples:

In food retail, Walmart, Unilever and Nestlé are already using blockchain to monitor their supply chains and help trace food contamination (this can also be hugely helpful. As the technology embeds itself further in businesses like these, food retailers can also take this opportunity to ensure they’re supporting sustainable farming and ethical labour practices.

In clothing retail, the trend for ‘fast fashion’ has led to complex supply chains that span across many different (often developing) countries, where cheap raw materials and labour are easier to find. But now, with the consumer backlash against the ethics of fast fashion, blockchain is ideal for ensuring brands are using sustainable sources of components and treating workers fairly – and communicating that to their customers.

As shoppers come to demand accountability from the brands they choose to spend their money with, blockchain is likely to become an intrinsic building block of supply chains across the retail industry.

The transparency blockchain enables doesn’t just create an opportunity for retailers to engender trust from their customers – it will also ensure that they’re practicing what they’re increasingly preaching when it comes to sustainability, ethics and the environment.

Regaining trust and loyalty in retail

As well as highlighting the potential of blockchain for retail, our new white paper examines a whole host of ways brands can bring customers back to brick and mortar stores and rebuild loyalty.

Read Regaining loyalty: How to use data to bring shoppers back to brick-and-mortar retail to explore how data should factor into every high street retailer’s strategy.

Get your copy now


One thought on “Is blockchain the answer to retail supply chain transparency?

  1. Jaimie says:

    I think blockchain is a really good idea, especially for companies trying to instill trust in their customers regarding their supply chain. This is a really interesting discussion, thanks for sharing!

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