03 Jan 2019 — Interest in blockchain related technologies has surged over the past year. As the technology gains mainstream interest, we are set to see another year in which more innovators are likely to launch services that seek to revolutionize supply chain information sharing at a time when consumer scrutiny is on the rise. One such platform is SUKU, a blockchain-based ecosystem, aiming to make supply chains more efficient, transparent and collaborative by offering a supply-chain-as-a-service platform to enterprises.
The company is primarily targeting small and medium-sized businesses with an on-demand, open, decentralized software distribution model which consists of applications and services that are utilized by supply chain participants. After laying the groundwork, Citizens Reserve, the company behind this new platform, is now seeking to enhance its capabilities with technology partners in a continually evolving ecosystem.
FoodIngredientsFirst spoke with Eric Piscini, CEO at Citizens Reserve, who has extensive knowledge of blockchain’s capabilities thanks to his earlier related work at Deloitte.
The SUKU platform comprises several layers, including an infrastructure layer, which fits every server or dataset from a technology point of view, as well as a blockchain layer which is a mix of Ethereum public and Quorum.
“Ethereum public provides a public structure and Quorum provides the permissioned blockchain which gives us better performance, capabilities, better privacy and security. We merged or bridged those two, to create our unique solution,” Piscini explains.
Click to EnlargeThe SUKU layer is the core platform and foundation for any component of a supply chain. Specifically, SUKU is developing a track and trace module that will make it possible to follow different components within the supply chain and different activities in it, as well as integrational layers to be able to link the core with many existing marketplace solutions. A further layer includes a set of applications and services, similar to an app store concept, but with a supply chain focus. This layer comprises supply chain management and warehouse management capabilities, which the company is developing in collaboration with different partners.
Customers today want to be able to make informed choices when buying a product or program. The reasons for this are environmental consciousness and safety, as much as a need for a transparent supply chain. This is also true on the B2B space, according to Piscini.
Increasing globalization and pressures to reduce costs and improve efficiencies have increased food supply chain complexity and given rise to concerns about black swan events – high impact but low probability events, a recent FoodIngredientsFirst article has noted. These conditions increase food firms’ vulnerability to adulteration of products through both fraud (for economic gain, e.g., the horsemeat scandal) and threat (for psychological or ideological reasons).
Amid recent E. Coli US food safety scares around lettuce, in September 2018 Walmart announced it was lauding the benefits of tracking lettuce and spinach through the supply chain through the use of blockchain. Walmart and Sam’s Club are urging their lettuce and spinach suppliers to contribute to a blockchain database that can quickly and efficiently identify contamination.
Their suppliers received a letter requesting that they trace their products all the way back to the farm using blockchain technology. Walmart says suppliers are expected to have all these systems in place by September 2019. All fresh leafy greens suppliers are expected to be able to trace their products back to the farm(s) (by production lot) in seconds. Suppliers will be required to capture digital, end-to-end traceability event information using the IBM Food Trust network. Meanwhile, in November 2018, it emerged that French retail giant, Auchan, had implemented TE-FOOD’s blockchain based farm-to-table food traceability solution in France, with further international roll-outs expected to follow in Italy, Spain, Portugal and Senegal.
Beyond food safety concerns, SUKU’s current project points to blockchain capabilities in ensuring traceability for environmental concerns as well.
“We are planning to work on soybeans, for example. Many Chinese buyers are interested in buying sustainable soybeans and in making sure they do not come from deforested areas. There is a big challenge in the soybean industry as they are clearing the Amazon to grow the soybean,” Piscini says.
Blockchain has become somewhat of a buzzword recently. Still, Piscini highlights that people may not know how or that they are even using blockchain.
“From a business point of view, we are moving away from large, centralized platforms where you have one key player controlling the entire platform and we are moving towards a more decentralized way of managing those platforms,” he says.
“It’s a trend to decentralize the business model, and that to me is a long-term trend,” Piscini notes, adding that evolving players such as SUKU can aid the process of decentralization.
Click to EnlargeThe platform provides a threefold benefit: transparency, efficiency and supply chain integration.
“We can provide better transparency and provenance to the participants, so one can know where the food, the vaccines, the electronics and even the components into the electronics are coming from. That is number one,” Piscini says.
“Number two is better efficiency and mostly for small-to-medium enterprises (SMEs) because they gain access to supply chain solutions that they currently don’t have access to, either because it is too expensive or because it is just too tricky to use some supply chain solutions today. With in-house management, on the other hand, it is going to be more streamlined compared to what you can find now.”
The third benefit of the SUKU platform is that it offers integration between different solutions. The supply chain world has a lot of different types of supply chains. US companies, Piscini says, to this day, have as many supply chains as they have suppliers. But in the SUKU platform, one can combine different applications and services and unroll the entire supply chain activity on demand.
To “fuse the entire ecosystem,” SUKU has created a utility “token” that can be used in multiple ways within the blockchain platform. One may pay transaction fees, decide to access premium services and use the token similarly to a credit card to accommodate one’s needs.
The platform is launching within the first quarter of the new year, and it is now in the process of choosing its collaborators, both in the development of the technological aspects and the building of the blockchain ecosystem.
“We are onboarding two types of companies today. Technology partners are one; these are companies who are building solutions from their platforms. This is one thread,” says Piscini.
“The other thread is to identify the right players to join the platform. We have activity around four different industries; vaccine, electronics, soybean and oil and gas. For those four industries, we are engaging with different trading partners to manage their supply chain,” he adds.
When someone joins the platform, they become a blockchain node and are given a “challenge” to define what their role is on the ecosystem and how they may be integrated.
“It depends on who you are in the chain – a manufacturer, a supplier or a contributor. When you join the platform, you become a node on the platform, a blockchain node. We can deliver and run a node for anyone who wants to participate in 10 to 15 minutes,” he explains.
As interest in such technologies increases, the number of blockchain technology suppliers are also rising. However, not all players are offering the same services, with some companies making, joining and integrating the system a lengthy and expensive endeavor, not cut out for small or medium-size businesses. This is one of the aspects that differentiate SUKU, according to Piscini, by targeting SMEs and speeding up the integration process.
“Our approach is that we know we cannot build everything in the supply chain, we need to build the base and build it over time. We need to open the platform to anyone who wants to participate – that’s a very novel approach,” he comments.
In his view, the key to growth of use of the technology lies in decentralized platforms: “We have people from different industries coming to us almost every day, saying they want to do it for their industry, from tires to managing oat fields,” Piscini says.
“Next for us is a real-life platform and it’s an exciting path to translate the platform into many different industries,” he concludes.
By Lucy Gunn and Kristiana Lalou
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