As the largest home renovation specialty retailer in the world, Home Depot runs almost 2,300 warehouse-format stores in the US, Canada, and Mexico that provide more than 30,000 products in-store and 1 million products online. Its retail locations offer a wide range of decor, lawn and garden, home improvement, and building materials as well as a number of services, such as tool and equipment rentals and home improvement installation services. Home Depot made an entry in the maintenance, restoration, and operations industry in 2015.
With time this huge growth and success of a corporation were both impacted by technological changes such as upgrades or advancements. For instance, online commerce enabled the business to efficiently promote its goods and services throughout a wider geographic area of a nation.
The trust that exists between the seller and the retailer is the foundation of their partnership; when disagreements do arise, it may take months to identify the root of the problem.
The Home Depot and Blockchain
Facing the situation, The Home Depot started utilising the blockchain technology, making significant technology investments to end all supplier disputes. In order to ensure complete accuracy of records, reduce the likelihood of erroneous entries, and employ a consensus-based mechanism to record every transaction, now the company is using blockchain technology to track all purchases from its suppliers. The corporation seeks to get rid of any supplier disputes that arise from poor management in a retail setting by using blockchain. Furthermore, the conflict may cause the inventory to increase unnecessarily.
In order to reduce the number of vendor complaints and speed up dispute resolution, The Home Depot is adopting IBM Blockchain to obtain real-time, shareable, and trustworthy information on the goods during the shipment and receiving process.
Home Depot: Shipping Dispute Resolution
Meanwhile, Home Depot is working on its own blockchain project. The hardware retailer recently teamed with Google Cloud in order to monitor its supply chain, according to a report from Eurofinance. As systems for maintaining records, Home Depot is experimenting with Hyperledger and Ethereum. If the blockchain platform works as intended, Home Depot may be able to handle its inventory as well as companies with more rigid controls.
Because it can’t get an understanding with its numerous suppliers over the location of the goods in the system, Atlanta-based Home Depot, which has over one million items listed on its website, has battled to keep inventories under control. Home Depot chief financial officer Carol Tomé, Speaking at a Goldman Sachs investor said, “From time to time we have disputes with our suppliers. They say they ship a hundred and we say we only received 80 and then we negotiate it out”
With the use of blockchain technology, a solution to this issue may finally be in sight. Blockchain can be utilized to work as a decentralised record-keeping system with cryptographic verification. As a result, Home Depot and its suppliers are capable of concurring on the orders. Every stakeholder can monitor product as it moves from the manufacturing factory to the stores. And there won’t be any disagreements in a distributed ledger setting because both parties are monitoring the product flow.
Instantaneous information exchange
In an ideal world, both the vendors and the merchant are aware of what they have delivered and received. The retailer pays the supplier for the items after confirming that the correct item has arrived. The main issue is that a supply chain has a lot of blind spots. Since there is no real-time communication taking place, it can take months to determine where a transaction issue began.
These trust issues prove to be expensive both in terms of time and money to resolve and necessitate the involvement of key individuals on both sides, whether it is due to a system flaw or human error in manual processes. “Supplier relationships with The Home Depot are really one of the keys to our business, they’re providing the innovation that we need to deliver on our promise to our customers.” says Dave Richa, Senior Director of Financial Operations.
So Home Depot, The home improvement store turned to IBM for assistance and adopted IBM Blockchain technology to enhance its interactions with suppliers.
Trusting in blockchain
With the help of blockchain technology, real-time visibility is made possible, allowing The Home Depot and its suppliers to respond quickly in the event that a discrepancy arises at any stage in the supply chain. “We’re essentially allowing vendors to have visibility into our receiving, and they’re allowing us visibility into what they’ve shipped, It’s almost like a settlement is happening with every single transaction versus waiting six, nine, twelve months down the road.” explains Brian Quartel, Director finanace at Home Depot.
Thus quickly pinpointing the source of the issue enables the shop and suppliers flexibility in managing issues. By design, blockchain produces an unalterable, permanent record of current data, making it impossible for anybody to add to or erase. Vendors who have role-based access only see the information they require. The information of one vendor won’t be seen by another.
A meaningful partnership between the parties has resulted from the vendors’ adoption of The Home Depot’s new blockchain system, which has made significant progress in closing visibility and communication gaps. As stated by David Richa, Senior Director Finance at The Home Depot “What really appealed to me is a real-time interaction with the vendor where we’re both looking at the same thing. It allowed us to really speak the same language when we’re going through disputes,” The Home Depot staff and vendors now operate much more efficiently.
Home Depot is only beginning to use blockchain, and it intends to add more businesses soon. It is amazing how blockchain may help The Home Depot receive reliable, shareable, and real-time information about the products during the shipping and receiving processes.