Walmart has long been known as a leader in supply chain management. However, its prowess could not insulate it from a problem plaguing the transportation industry for decades: vast data discrepancies in the invoice and payment process for freight carriers, which required costly reconciliation efforts and caused long payment delays.
An analysis identified the root cause of the problem: the use of multiple information systems between Walmart Canada and its carriers that could not talk to each other. Consequently, reconciliation had to be performed manually — a labor-intensive, time-consuming process riddled with inconsistencies. By all accounts the system has been a tremendous success. Prior to DL Freight over 70% of invoices were disputed. Today less than 1% of invoices have discrepancies, and these disputes are easily flagged and quickly resolved. Gone are the days of payments taking weeks or months; carriers are now getting paid on time.
For Walmart and its carriers, this meant working with each carrier’s unique data , which is combined with governing master tables of information such as fuel rates and tax rates. The parties should then jointly agree to the formulas that the blockchain will use to calculate each invoice. The financial value of automated checks and balances goes beyond payments. For example, since the system automates all financial calculations and updates them continuously throughout the process, any financial service — such as carrier financing of the invoices due for payment — can also be automated because the blockchain system eliminates the need to determine if an invoice is accurate and valid.