Remember when you had to go to a store to get something? You had to get in your car, drive there, walk through the store, and wait in line at the cashier. However, now, almost anything can now be purchased digitally.
It's not only the end consumer that does the shopping digitally. The digital revolution has reshaped global trade. Today's entire supply chain depends on digital technologies, from manufacturing and shipping to payments and the point of sale.
Digital Manufacturing
Manufacturing today is much more digitized than it was in the past. Many process steps are automated, making them faster and less prone to error. Manufacturing becomes less expensive as a result, as it no longer necessitates as much human intervention.
Digital Shipping
We don't have cargo drones yet on a large scale – although that's just a matter of time. Still, lots of digital tools accompany your goods until they arrive at your doorstep. GPS tracks where your products are and tell you how soon they will arrive. Sensors track the condition of your product. For example, if you order meat, they can track that the cooling is intact. Digital tracking also allows shipping companies to optimize their shipping routes to avoid delays.
Digital Payments
In trade, cash is a relic of the past. Almost everything is paid for electronically, making payments faster and cheaper. FinTech's have also come up with ways to make payment flows more efficient. For example, if you want to pay in a foreign currency, you can use a service like Wise to lower your transaction costs. In the future, blockchain-based cryptocurrencies could play a larger role in international trade, as they can further reduce transaction costs.
Digital Trade Finance
Trade finance is one of the most cumbersome aspects of international trade. In one transaction, several parties come together, and banks and shippers require tons of financial paperwork. This bureaucratic nature of trade finance makes it expensive and slow. Blockchain-based trade finance offers an alternative because all parties transact via a securely distributed ledger. That reduces the need for intermediaries, which drastically cuts the complexity of international trade finance.
Integrated Trade Platforms
It's also likely that trade will increasingly move to integrated trade platforms such as Export Portal. All the digital trade tools come together here, from blockchain-based wallets and digital payments to digital documentation exchange, secure messaging services, and more. Trade platforms aim at making trade easier by leveraging the different technologies available. They create one trade cockpit for all needs.
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