Chocolate Supply Chain Ready For Blockchain Disruption
The chocolate supply chain isn’t the first thing we consider when we receive a gift basket that includes a couple of chocolate bars. We think, yummy, right?
However, most consumers don’t think about where the chocolate comes from when, whether choosing a gift or buying their kids some candy at the checkout lane so they won’t throw a temper tantrum.
They see only the end result of a long and complicated chocolate supply chain that often starts at a plantation in Africa and involves dozens of steps before the final product is sold at the grocery store.
We are now seeing serious disruption in financial markets. Every day a new ICO suggests a new and glamorous use of blockchain technology. Is there really a need to examine something as seemingly-tangential as the chocolate supply chain?
From Slave Labor To Transparency & Social Awareness
In the United States, we see a plethora of messages that encourage us to be more aware of the social impact of our purchases. The chocolate in that candy bar could have been harvested using slave labor and we’re told not to buy it if we don’t know exactly where it comes from. As many as 1.8 million West African children are victims of slavery and human trafficking and many of them wind up on plantations that can provide the chocolate for your cheap bag of Halloween candy.[i]
Does that change anything when somebody’s kid is making a huge scene because he wants a candy bar? In the real world where so many parents can’t afford the Fair Trade chocolate, probably not. Humans are hardwired to deal with what’s right in front of them – the kid throwing a fit – and not focus too much on what they can’t see or do much about. That can make real change difficult in a world where multibillion dollar global conglomerates look the other way on human rights to keep the cost of the resources low.
Even for the consumers who have extra disposable income and who care about the social impact of their purchases, it can be difficult to know that they’re getting the real deal. How easy is it for corporations to slap a Fair Trade label on their products and then claim that they “didn’t know” that somebody was cheating somewhere along their supply chain? Even when those corporations are dealing as honestly as possible and think they have all their T’s crossed and I’s dotted, might a depot unknowingly accept a shipment of chocolate that has been stolen or smuggled? Do chocolate farmers truly keep their promises to give their employees a fair compensation package when they sign up for a Fair Trade program?
It’s hard to tell when it’s difficult to verify that all steps along the supply chain are keeping their promises as participants in the Fair Trade system.
How Blockchain Could Create A Fairer Chocolate Supply Chain
A blockchain can act as a marketing tool for companies wanting to capture the “conscious consumer” market by allowing them to demonstrate the origins of their products. It can empower consumers who care more about making informed decisions than buying a moment’s peace and quiet by caving to their child’s temper tantrum. It’s not hard to imagine an app emerging that helps such consumers identify products and their origins.
One of the potential benefits of applying the blockchain to the chocolate industry’s supply chain is that consumers could scan a QR code and see exactly where the ingredients of the chocolate bar they’re holding come from. They could, for instance, see live streaming videos of the workers at the chocolate plantation; the cattle at the dairy farm that provides the milk; and the orchard that provides the almonds.
They can do this because each shipment of raw materials is logged into the system right at the source and reliably tracked throughout each step of the supply chain, and any questionable shipment that doesn’t come from an authorized source is automatically rejected when a blockchain application is used.
A blockchain supply chain app with basic QR codes could provide convenient access to everything you ever wanted to know about where your chocolate bar comes from, and it could significantly disrupt the chocolate industry by forcing it to meet demand for ethically sourced chocolate.
This is what happens when consumers can make fully informed decisions about the products they buy. And if chocolate seems an unlikely candidate to benefit from this emerging technology, perhaps we should reconsider that thought – and approach it from the perspective of a kid in western Africa, instead of as a spouse looking for a Valentine’s gift.
Editor’s note: For more information on child slavery in the chocolate industry, visit SlaveFreeChocolate.org