Blockchain and the Disruption of the Wholesale/Retail Space

Blockchain, Innovation | September 11, 2018 By:

Blockchain historically has been used mostly for cryptocurrency, but the distributed ledger technology is now influencing just about every major industry. In the retail and wholesale spaces, blockchain is the next step in a revolution that began more than two decades ago with the mass adoption of the Internet. Online marketplaces signaled the slow and eventual demise of traditional retail, and blockchain is doing the same but is now replacing middlemen and entire supply chains that are built on inefficiency.

Blockchain technology and the smart contracts it utilizes have the potential to drastically transform the traditional and online retail industries by providing a platform for direct sales to consumers. Blockchain has the ability to disrupt the wholesale space, as well. Blockchain can allow retailers, manufacturers, distributors and wholesalers to market directly to consumers, and sell minimum order quantity deals to consumers, significantly lowering their costs. Until now, neither traditional nor online retail platforms have been able to unlock the minimum order quantity problem that prevents consumers from achieving the lowest possible prices on goods.

Blockchain allows for a transparent marketplace, rather than one with hidden fees. One of the biggest problems plaguing the e-commerce space is the lack of transparency. Buyers are unaware of when these fees are already baked into the selling price, and when they are not. With the incorporation of blockchain, that clarity is inherent, and also encourages higher customer loyalty and marketplace efficiency, making the experience more enjoyable and trustworthy for all parties.

This transparency applies not only to fees, but to the supply chain as well. By integrating blockchain into the wholesale retail space, consumers can participate in a fully informed ecosystem. Consumers have insight into the entire supply chain, meaning they can see where items are sourced from, the development of the marketplace, the internal logistics, where these items are stored and how they are sold. This visualization drastically increases the trust consumers have in wholesale retailers.


Blockchain is a powerful medium of exchange between buyers and sellers, because it creates a decentralized ledger that is transparent and immutable. Every transaction is recorded and publicly available, to absolutely everyone on the network. Blockchain technology gives consumers unimpeded access to products directly from wholesalers, without expensive, progressive mark ups through the traditional retail value chain. Through smart contracts, payments for goods are held in escrow until the consumer receives delivery, and is fully satisfied with the received product.

Online retail has greatly enhanced the market’s access to a wide range of products, but consumers are still paying too much for goods and waiting too long for their deliveries to arrive. There are millions upon millions of online stores, and the e-commerce market is still concentrated in the hands of a few large players. Blockchain technology flattens the hierarchy, and provides a level playing field for retailers, manufacturers, distributors and wholesalers to compete for consumers’ business.

Over the next few years, e-commerce is set to become a four trillion dollar industry. The integration of blockchain technology can accelerate that growth by creating a more transparent, competitive and cost-effective market for both buyers and sellers.