Commodity Import Trade Digitalization

Commodity Import
Trade Digitalization

Problem Statement

Commodities for every industry, imported even as part of global strategic sourcing strategies, is always complex due to process/compliance/regulatory issues across multiple parties and that to with manual information flow without any visibility or transparency. Import process for commodities attributes to long lead time/cycle time to complete a transaction manually end-to-end forcing the organizations to stock more causing higher inventory cost and less revenue. Most of the times the organizations face shortage in supply due to disruptions in commodity import process. Though technology at the transactional level is well managed internally by the organizations, the companies often fail to handle the external process for commodity import due to less focus, lack of transparency, trust and authenticity causing issues with the quality of commodities received, inventory shortages and lost sales

With rapidly evolving technology, organizations are struggling to keep outdated, customized, and siloed systems and processes integrated, causing critical inefficiencies for the business and organization. To gain value and reduce the inefficiencies, organisations are addressing to resolve some of the below pain points using emerging technologies such as blockchain, AI, Machine Learning.

Procurement strives to gain further value and reduce inefficiencies that are commonly daunting organizations by addressing some of the pain points:

Poor collaboration between internal business functions (Purchasing, Manufacturing, Finance) of an organisation
Manual and lack of standardized sourcing process involving data/document exchanges (Purchase Order, Sales Invoice, Good Receipt Note, Shipping Instructions etc.)
Poor collaboration and co-ordination with suppliers and their business functions and related ecosystem (Custom House Agent (CHA), Transporter, Inspection agency etc.)
Lack of supply chain visibility, leading to high safety stock levels and inventory carrying costs
Manual paper-based invoice processing and long invoice processing cycle times
Manual reconciliation and matching for payment processing to suppliers
Little to no exposure on third-party risk management or extended supply chains and non-compliances to multi-geographic jurisdictional requirements
Limited ability to perform analysis by vendors and categories

As organisations prepares for the procurement transformation journey, evaluating the full supply chain process landscape involving internal and external interactions is a must. Procurement is foundational pillar of the supply chain process, but other functional departments such as Finance, Operations, Shipping/Logistics, and wider Supply Chain footprint involving other stakeholder groups such as CHA (Custom House Agents), Transporter, Banks etc. all have an integral role to deliver a fully reinvented end-to-end solution.

Company initiatives and mandates are underway globally, striving to transform direct procurement involving importation process and bring higher value across the business enterprise. Organizations are working to achieve enhanced business benefits and assess the potential savings from improved control and compliance, and process efficiencies with digital platforms/solutions.

The Business Need

Evolving landscape in connected supply chain procurement process involving importation of goods from overseas market.

Challenges

Business Scenario

Organizations are facing supply chain disruptions in their procurement process involving overseas importations.

Business resiliency in procurement process involving multi-party especially with overseas supplies is becoming a critical business requirement

Organisations are moving digital with higher automation, greater visibility, increased savings with their procurement process from overseas suppliers.

The lack of visibility in the procurement process leads to inefficient supply chain, with collaboration issues and inability to enforce effective risk-free contracts.

The procurement process is a complex process covering multiple organization with heavy documentations and multiple contracts.

Availability of critical supplies from overseas is a time-consuming manual tasks and delivery delays significantly affecting working capital cycle and need to maintain increased inventory.

dltledgers Can Help You

Our state-of-the-art blockchain-based platform provides a smoothened and streamlined global strategic sourcing process involving importation from overseas markets. The accelerator built to establish the multi-party network, digitize the transactions across these multiple parties with the trusted, secured and transparent information flow in the form of documents verified and agreed.

The real time collaboration across multiple parties to handle the exceptions in Procure-to-Pay process by providing the visibility and to proactively act to avoid shortages and lost sales.

Solution

Solution Brief

Smoothen and streamline procurement process involving overseas importation with shorter cycle time
Enhance collaboration with multiple parties in multiple geographies with improved user-efficiency and end-user experience
Enforcement of effective risk-free contracts across purchasing with multiple suppliers/vendors
Greater visibility and transparency across the digital network of multi-tier suppliers to drive ethical behaviour throughout the supply chain
Reduced supply chain cost, risk and inventory, with significant working capital improvements
Streamlined procurement process involving multiple suppliers in multiple geographies in a digital network
Accurate data and digital document repository with auditability across functional departments and ecosystem participants.
Real-time reports and secure tracking of the origin of goods and the chain of custody with verified documentations and certifications as tamper-proof digital records for future use and compliance.

Benefits

Business Value to each involved parties within the import trade process with visibility and transparency to avoid disruptions
Reduction in Inventory Shortages by 15-20%
Supplier OTIF (On Time In Full) improvements by 10-15%
Increase in Revenue by 20-30% connecting the multiple parties with the real time information flow
Reduced P2P processing time for import process by 60-70%
Accurate data and digital document repository with auditability across functional departments and ecosystem participants.
Real-time reports and secure tracking of the origin of goods and the chain of custody with verified documentations and certifications as tamper-proof digital records for future use and compliance.

“We were greatly benefitted by using blockchain-based trade finance solutions via dltledgers platform. We weathered the storm exceptionally well. During the peak of Covid-19, we moved 14.3% more product compared to same period last year. We managed to reduce our document collection times significantly and collaborate with our business partners more effectively. It enabled us to win new business especially in such a time as this.”

– Nitin Jain, Head of Treasury and Capital Markets, Agrocorp International