Retail Giants Nike, Macy’s and Kohl’s Turn to Blockchain Tech to Combat Fakes

Big retailers are turning to blockchain technology to shake off the multi billion-dollar industry of fake goods and deceptive counterfeiting. Auburn University’s RFID lab is tackling a sophisticated and highly lucrative industry that has pushed worldwide losses to over $1 trillion.

Auburn has created the Chain Integration Project (CHIP), which uses blockchain technology to allow data sharing between supply chain partners such as Nike, Macy’s and Kohl’s. This allows them to see data up and down the supply chain, in order to combat counterfeiting, settle disputes, and slow inventory shrinking.

Overall an estimated 80% of the world’s fake goods come from China. According to the AP,

“The amount of total counterfeiting globally has reached to 1.2 trillion USD in 2017 and is bound to reach 1.82 trillion USD by the year 2020 which includes counterfeiting of all equipment/products from defense equipment’s to counterfeiting of watches.”

The blockchain is a storehouse for digital transactions related to products that pass through the supply chain. Each time the RFID system detects a product, a new transaction with location, timestamp and unique ID numbers is created and sent to the blockchain. Stakeholders can view these transactions and make decisions based on virtual snapshots of products throughout various stages in their lifecycle.

Major consumer brands and big retailers such as Nike, PVH Corp, Herman Kay, Kohl’s and Macy’s are trialing the blockchain solution. Researchers are able to successfully incorporate data streams from source to store, connecting the dots between data points and creating histories for products that pass through the supply chain.

Assuring confidentiality is another key aspect of the CHIP project. Allan Gulley, RFID Lab research fellow, confirms,

“Confidentiality is the number one concern that most companies have when they begin their blockchain journey, and it is very understandable. Protocols and permissions must be put in place to prevent the inclusion of competitively sensitive information, as we did in the CHIP proof-of-concept.”

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