The moment we hear blockchain, terms like bitcoin or cryptocurrency come to mind. Honestly, blockchain is beyond these terms. Blockchain has seen significant growth in the past few years, and its benefits of the same to the industry are undeniable.
Many marketers struggled to understand bitcoin and cryptocurrency, so they turned down the idea of using this technology for their business. Do not worry, we will try to cover everything about cryptocurrency and how it poses a significant impact on your business efficiency, security, and trust within the B2B arena.
A brief about blockchain technology
Let us understand blockchain through this example. Imagine a spreadsheet. Now imagine this same spreadsheet duplicated thousands of times across a network of computers. Finally, imagine a network designed only to update this spreadsheet regularly.
Well, this is the most basic concept of understanding blockchain.
It leads us to understand that all the pieces of information in the blockchain exist as a shared database. It means that there is no single location. The records are kept public, and they are verifiable. As there is no centralized version, no hacker can tamper with the data. Data fed on a blockchain is available to everyone on the internet and it is hosted by millions of computers at the same time.
Due to such capabilities, blockchain allows all digital information to be distributed and not copied. It is even considered the backbone of the internet. Although blockchain was created for bitcoin, the tech community is growing and being diverted to other industries as well.
Benefits of Blockchain for B2B
1. Saving from after-effects of Tax-liability
US Supreme court in 2018 presented some figures that the lack of online sales cost them $44 billion yearly and more. After the statement was released, many states started imposing felony tax charges on companies.
How can blockchain help here? With the help of blockchain technologies, businesses can share their sales records with the tax authorities so they are saved from any tax liabilities. There are digital sales receipts, invoices, and other genuine retail documents that reduce the chances of fraud in the system. A B2B business can easily get its tax refunds on retail purchases.
2. More transparency in a transaction with Smart Contracts
B2B industry runs on RFPs and smart contracts help customers to understand the project better and find out minute details such as payment plans, delivery status, etc.
One wonderful advantage of such smart contracts is that neither the retailers nor customers can back out from the stated terms and conditions once agree upon. If they back out, they will not get the stipulated sum of money promised in the contract.
3. Improving financial Efficiencies
The total global spending and investment in Blockchain are projected to be around $19 billion by 2024, according to an IDC report. Industries taking part in such investment rounds will be banking, manufacturing, and retail.
In the B2B marketing ecosystem, the multiple benefits of blockchain technologies are:
- Expedited settlements.
- Fraud prevention.
- Seamless payments.
4. Faster and secured payment transactions
We talked about smart contracts earlier, and taking a cue from the same, Blockchain technology makes financial transactions easy and secure for B2B companies. The current payment systems are centralized and even if you have digitized your payment systems, the payments are mostly centralized. A payment may take even 3 days to clear as it has to be approved by a third party.
On the other hand, Blockchain is much faster. Blockchain removes the need for third-party interventions and focuses on peer-to-peer transactions. The system cuts down the time and costs required to process a financial transaction. With the need for third-party approvals, the payment needs to be approved by the blockchain system only.
5. Highly secure supply chain management
Supply chain technologies play a crucial role in moving products. With the help of blockchain, you can secure the complete movement of goods. Trust plays an important role when it comes to business. Blockchain allows anyone to track what went into the product, who handled and how it is reaching him. The result – your customer trusts you more. Luxury brands can also show them how genuine the product is to the customers.
Do you think B2B and blockchain is a made for each other?
Undoubtedly, Blockchain has huge potential; much beyond anyone can imagine.
The scalability and reliability offer the potential to turn around existing enterprises and their traditional way of running B2B businesses. Blockchain helps businesses to accurately check and record data, and make safer and faster transactions.
Of course, adopting blockchain will come with its own set of challenges, but when you start using it, it will become a part and parcel of the business.
