How are Blockchain Applications Driving the Growth of Small Business?

Blockchain technology is one of the most successful technologies of the 21st century. Like AI, AR, VR, and other such trending technologies, blockchain technology has found its application in most of the sectors present today, thanks to its robust architecture that offers impeccable security. Industries are heavily investing in blockchain-based solutions owing to the numerous benefits of this technology.

According to Statista, worldwide spending on blockchain-based solutions is anticipated to reach 19 billion U.S. dollars by 2024, up from 6.6 billion U.S. dollars projected for 2021. As per data, startups based on blockchain technology are attracting a number of investors, and these startup companies around the world have garnered about 2.6 billion U.S. dollars in venture capital funding.

Witnessing the impact of blockchain technology on significant sectors such as banking, supply chain, cybersecurity, etc., small businesses too are rapidly adopting this technology to drive their growth. Hence, in this post, we’ll discuss how blockchain technology can help small businesses grow.

Top ways blockchain technology is helping small businesses grow

 

#1 Performing safer transactions

These days, with a rising number of security concerns and incidents of banking fraud, the need to create safe banking channels is becoming necessary. This threat is becoming more damaging for small businesses when performing business transactions. We all know how difficult it is to garner funds and run a business, and considering small companies, every penny holds significant value.

Blockchain technology is the best solution when it comes to securing online transactions. The immutable structure of the blockchain ledger makes it impossible for anyone to change any data in the ledger once registered. Due to this, the chances of fraud that occurs by changing the number of transactions and other significant data stored in the ledger become next to impossible.

Thanks to the impenetrable nature of a blockchain ledger, it’s impossible to access it without an invention id and password. Even if a miscreant steals this information, they can’t alter anything. Hence, blockchain is an ideal technology for small businesses to employ in order to cut the risks of transaction fraud and use their finances to the fullest.

#2 Saves costs by eliminating third parties

Owing to the decentralized nature of blockchain technology, any transactions carried out using a blockchain-based solution do not require a third party such as a bank to regulate the transactions. Generally, when transactions are made, especially in cases of cross-border payments, a significant part of the total amount being transferred is charged by these regulating authorities.

But when you use blockchain-based solutions such as cryptocurrencies to make payments, you don’t have to pass through a regulating body; hence, you don’t have to pay any transaction charges. Therefore, you save significant costs by eliminating third parties while making payments using blockchain-based solutions.

Moreover, in some cases, including cross-border transactions, parties must wait for a significant amount of time to get the payments, which further delays shipments and other operations. On the other hand, blockchain-based payments are real-time transactions and ensure that the payments are reached in real-time, thus saving time and pacing the various processes.

#3 Streamlines operations

Blockchain-based solutions are being widely used in managing and streamlining global supply chains. It is recommendable for small businesses such as retailers, restaurants, and other companies to invest in blockchain-based solutions for managing and tracking their supply chains. A measurable improvement has been recorded in terms of quality and money saved by eliminating the possibilities of mismanagement.

Blockchain-based supply chain solutions can help businesses ensure that things in their supply chain are shipped correctly and in the right environment. Owing to the transparent and distributed nature of blockchain ledgers, every person that is a part of the supply chain management can simultaneously keep track of what’s happening in the chain.

This enhances visibility in the supply chain and ensures that minimum damage occurs and things get delivered at the right time and in the right conditions.

#4 Helps in inventory management and tracking

Inventory management holds the same importance as supply chain management for small or large businesses. Businesses tend to face significant losses due to inventory mismanagement, which often paves the way for situations like stockouts, overstocks, and other such scenarios that end up costing businesses a lot of money.

Retailers, wholesalers, and small ecommerce businesses should invest in inventory management systems based on blockchain technology. These systems can record data such as the total number of items in inventory, their manufacturing and expiry dates, optimum management conditions, and other such aspects. Blockchain technology-based solutions create transparency and boost overall visibility in the inventory management systems.

When integrated with RFID technology, this blockchain-based system can help you track every item in inventory and the optimum conditions they should be in. This way, you can ensure that the right number of items are stored in inventory and that they leave it at the right time to avoid situations like the ones mentioned that lead to significant monetary losses.

#5 Building trust and better reputation by serving better

For any business to grow, it needs to build trust and credibility in front of the customers it serves. After all, the customers are the most prominent means of advertisement for any business; if served properly and satisfactorily, customers can spread the word about your business to hundreds of others, thus leading to significant growth in customers.

Blockchain-based solutions, as already mentioned, boost visibility thanks to their distributed structure. Incorporating blockchain-powered tracking systems, i.e., self-tracking channels for customers, can help build customer trust by allowing them to track their deliveries and ensure they will reach them at the right time and in the right conditions.

By delivering products at the right time and of optimum quality, a better reputation can be built in the market. This way, blockchain-based solutions can be a huge factor in driving growth for small businesses.

Wrapping up

Blockchain-based solutions are rapidly being adopted by various organizations representing a variety of sectors owing to the effectiveness of these solutions and the robustness they bring into operations. This post discussed how these blockchain-based solutions are helping small businesses grow and save money.

Significant losses can be avoided by integrating blockchain technology into various operations such as inventory management, payment processing portals, supply chain management, and other functions. These blockchain solutions not only help save money but also help in boosting profits by improving customer satisfaction. Hence, small businesses should invest in these blockchain-powered solutions to streamline their operations and earn more profits.