A new platform, INS aims to save up to 30% on everyday shopping by implementing blockchain and smart contracts into the supply chain management bypassing retailers
Australia’s biggest food and household goods brands have signed up to a new shopping service which can slash grocery bills by 30 percent by cutting out the supply chain middlemen, i.e. retailers and wholesalers. MARS, Reckitt Benckiser and others have all signed agreements (Memoranda of Understanding) intending to start selling items directly to consumers through INS Ecosystem digital platform which is launching in Australia next year. It means thousands of household favourites could soon be available to buy at much lower prices.
While supermarkets and wholesale retailers negotiate prices with manufacturers including supply chain marketing and retailer’s mark-up, INS platform will let brands decide their own prices and let the consumers vote for them with their money. Consumers will be charged for the wholesale cost of items, plus a logistics fee to cover storage and transportation, expected to be between 10 and 15 precent of an average weekly shopping basket value. Shelf prices on the other hand consist of the wholesale price, plus a range of extra-costs conducted by supermarkets, which can raise prices by 50 percent.
The model will benefit manufacturers as they can charge higher wholesale prices for items than supermarkets are willing to pay, while consumers still receive a 30% cheaper end price. Brands will also be able to gather data on consumers who buy their products and use it to offer loyalty schemes to individual customers depending on their buying patterns.
Because of implementing blockchain and smart contracts INS Ecosystem, unlike traditional shops, won’t need managing by a central administrator, as it manages and updates itself. Smart contracts ensure full transparency and reliability among all the platform participants.
In addition to those agreements already signed, Kraft Heinz, Kellogg, Johnson&Johnson, Arla, and a number of independent consumer goods producers from Brazil, Britain, Australia, Italy are showing strong interest in INS Ecosystem.