With multiple outbreaks of health hazards in food products such as the toxic insecticides found in eggs occurring in Europe, South Korea and other countries in 2017, consumers are faced with rising fears in relation to supply chain management.
However, existing supply chain management systems appear to be failing to address such concerns because they do not seem to provide for monitoring of pre-delivery stages along the supply chain. Therefore, even if a problem arises, it is difficult to understand at which stage the problem occurred, and to how manage the problem. There is a growing tendency for consumers to demand transparency in how a business deals with its supply chain process.
TEMCO is envisioned as a public supply chain blockchain system that aims to utilize Smart Contracts to overcome the limitations of existing supply chain management systems. In the existing system, the information of each distribution participant within the supply chain process may be segregated and cut off from the each other, but TEMCO aims to make it possible to connect each participant through a blockchain so that the pre-delivery stages can be grasped in real time. The potential is to build consumer trust regarding the supply chain process, and also to create a cost-cutting effect through more efficient supply chain management.
The 2017 pesticide-contaminated egg crisis was one which directly revealed the flaws of existing supply chain management systems. By failing to locate and keep track of records regarding the contaminated eggs, the government and businesses involved could do little to identify and stem the problem, leading consumer fear levels to rise drastically.
The only clue that could help trace the origin of the contaminated eggs was the “eggshell code” printed on the eggs for records management. But because every manufacturer has different ways of printing these codes, and several variations of codes are used even within the same farm, the management system was haphazard and lacking standards and regulations, ultimately leading to failure to quickly contain and manage the crisis effectively. The government repeatedly misreported eggshell codes from substandard farms and had to make corrections daily. According to a representative of the government, it has been a challenge to track unfit farms as well as to identify the farms that manufactured the substandard eggs.
Due to the apparently disorganized nature of existing supply chain management systems revealing the reality of serious limitations in crisis management, the need for transparency and systematization of supply chain processes is becoming increasingly dear. As income levels rise and IT infrastructures expand, consumers also begin to demand a higher level of quality in products. They want to purchase products that have come through a trustworthy supply chain process. Moreover, companies also want to elevate trust in their products and enhance their level of service to allow for more efficient management capabilities.
As a response to the change in consumer needs, large corporations are developing proprietary supply chain management systems. They are also using big data for cost optimization, process improvement, and new business development. On the other hand, medium-to-small businesses may lack infrastructure and resources to invest in a similar system.
The TEMCO project aims to create a system that can overcome the limitations of the existing supply chain management system by utilizing Smart Contract within the public blockchain ecosystem. The goal is to enable all participants to have access to real-time information on the entire supply-chain process from production through distribution to sale at retail outlets.
Through TEMCO, consumers will be able to choose products that have passed through reliable supply chain management standards. Business-es will be able to increase efficiency by streamlining supply chain process and structure using the TEMCO platform. They may also increase profit-ability by optimizing product sales strategy using supply chain information within the blockchain.
The cost of introducing such infrastructure for SMEs can also be drastically reduced. In the past, it took several million dollars to develop supply chain management infrastructure for SMEs. The TEMCO platform, how-ever, seeks to connects every participant under a single platform that offers big data analytics without the need for a large initial investment or additional subscription fees, as the only cost is for execution of Smart Contracts within the ecosystem.
There is also an advantage in strengthening the product safety mechanism. In the existing system, it was difficult to identify the cause of quality-related claims. With the introduction of the TEMCO platform once it is developed, it will be possible to trace distribution history down to a single order, which can help identify the responsible party if a dispute occurs. Therefore, it is expected that it will help manage food safety at the government level including the Ministry of Agriculture and Forestry and the Food & Drug Administration.
TEMCO will also capitalize on the advantages of a private blockchain. Confidential information that should not be disclosed can be managed without being exposed on the platform.
The TEMCO team will also build a consumer application and platform for big data analytics. The application will increase consumer confidence in products by providing real time supply chain information from beginning to end. The platform for big data analytics based on the data collected in the blockchain will enable SMEs to develop a low-cost supply chain infrastructure and to gain business insights.
TEMCO’s Integrated Supply Blockchain
Data-Centric Smart Supply Chain Solutions TEMCO started with the idea, How can products be distributed and deliv-ered to consumers in a reliable way?”
As previously mentioned, existing supply chain management systems do not satisfy consumers who demand reliability, mainly due to the fact that consumers do not have direct access to reliable information, instead re-ceiving information verified by a third party only indirectly.
The TEMCO project aims to ensure that accurate supply chain informa-tion is contained within a blockchain when a product is transferred via Smart Contract. This connects manufacturers, warehouses, transport companies, distributors, and end consumers, enabling supply chain in-formation to be shared in real time.
TEMCO token and point TEMCO token economy consists of ‘tokens’ and ‘points.’ TEMCO token is a utility token, which is an RSK based token (RRC20) and used in the platform to facilitate transactions. TEMCO point is a reward for platform contributions, which refers to direct and indirect participation in various activities within the platform.
1. Users TEMCO token is utilized in the following ways.
a. Smart contract execution fee to upload data
b. Key payment crypto tokens for product purchases
c. Platform for economic activities through connection to exchanges
d. Contribution reward for users in the market and TEMCO platform
TEMCO Token Appreciation
TEMCO point is rewarded for user contributions based on the following activities. a. Use token to purchase products b. QR scan, review, like, react, reporting of counterfeit goods and faulty products c. Share public data on blockchain and participation in the community
TEMCO token is utilized in the following ways. a. Convert points to tokens to pay for smart contract execution fee b. TEMCO platform (eg. BI toot) service fee c. Earn the right to preoccupy premier spots within the market platform
TEMCO point is rewarded in the following ways.
a. Different amount of TEMCO points are rewarded to vendors based on monthly and quarterly product rank and sales growth.
b. Upload data on to blockchain Expected benefit: When vendors upload data on to blockchain, a massive public database will be developed. Using that database, companies can use the BI tool to utilize and visualize data for business improvements. Since this requires quality data, TEMCO can increase companies’ data contribution that will result in a resourceful data stream environment.
c. Answers and reactions to buyers’ questions and reviews
a. TEMCO point has an expiration date of 6 month
Expected benefit: Promote continuous contribution for long term success of the platform
Community’s rote in TEMCO platform TEMCO platform is meaningful if the users in the community are actively and continuously participate based on token and point incentive system.
TEMCO platform expected benefit TEMCO platform and community ensures trust between vendors and consumers. Manufacturers and distributors are rewarded with points based on product reviews, and they can convert those points to tokens to pay for smart contract execution fee and/or BI tool service fees. For consumers, as vendors and sellers try to provide better service, they are gain transparency.
In return, consumers provide demographic information.
TEMCO point policy
TEMCO point is rewarded based on platform contribution. Each user can Level up depending on how many TEMCO points accrued. Each Level re-ceives different services and rewards. User level is divided into 3 tenets – Silver, Gold, and Platinum. A user can only Level up based on the TEMCO
TEMCO Token Staking Model
1. Token staking model overview
A token staking model is implemented in the TEMCO platform to promote healthy ecosystem and growth. Compared to those who do not stake, those who stake will receive advantages. For example, those who stake can participate in 100% of the contribution programs offered and receive additional rewards.
In addition, to prevent excessive and unqualified activities [ex. posting unqualified reviews, duplicate content generation, false accusation for fake products], those who are identified as abusive users are blocked from participating in the platform using lock ins. Once token log ins are implemented, the user cannot participate in the platform for a duration of time.
2. Benefits for token staking user (vendor, seller)
a. Priority bidding rights for premier sales section that results in higher clicks and displays when selling products
b. Reduced transaction fees, and discount on BI tool service.
c. More points for answering questions and reviews by buyers
3. Benefits for token staking user [platform user]
a. Point received for smart scan [data uploading]
When users scan products, product information and users’ anonymous information are uploaded to blockchain. Such data is valuable to third party entities such as consulting and marketing firms. When those companies purchase that data, users are rewarded for their contribution.
b. Reviews on product purchased
Users who purchased products can write reviews and post questions on the products purchased. Depending on the quality and contribution level, users are rewarded with TEMCO points. Based on the reviews, seller
rating will change and therefore, sellers are motivated to provide quality goods and services.
c. Reporting counterfeit goods
Users can report counterfeit goods within the platform. Data related to counterfeit goods for luxury and organic goods sold on the platform will be used to manage brand quality. To increase quality of the report and prevent overuse, users are compensated if the accuracy is 75% or more.
d. Questions and responses related to products
Like vendors, users are also rewarded points for content generation such as asking questions and responding.
4. TEMCO token circulation model
a. Automatic staking level adjustment for individuals
Once the total staking amount reaches about 25% of the hard cap, the staking amount is automatically adjusted so that the lock in rate is consistent.