The capabilities that blockchain possesses have the ability to change the business landscape as we know it. So it is within the best interest of small business owners to take the technology seriously and take full advantage of all the functionality blockchain can offer to their businesses.
Have said that, blockchain is a very complicated technology to fully comprehend its potential which leads to many people just ignoring it. This is a big shame as they are turning their back on something that can positively transform their business. So today we will be looking at ways small business owners can use blockchain in their business.
This is a major headache for small business owners as they can lose thousands of dollars through things like false involving.
A common use of blockchain is smart contracts those. Those are computer programs that ensure that the terms of the contracts are met before a transaction can be processed. How does this prevent fraud in a small business? Many of these tasks that can lead to fraud can be automated. Using smart contracts makes sure certain conditions need to be met before, for example, invoicing takes place.
For example, false invoicing is when employees try to use legitimate invoice of goods a customer wants but when it comes to paying for the goods they change the banking details so that the money is transferred to their account. By using a smart contract, payment will be handled automatically as the customer only has to authorize payment without manually writing down banking details. This prevents dishonest employees from getting a chance to trick customers.
As we can see with smart contracts when implemented adds a layer of security as certain conditions must be met before a transaction takes place potentially saving the business thousands of dollars.
With blockchain the amount of administrative work greatly reduces which in turn reduces the amount of paperwork you have to do, saving you a lot of time and as we all know time is money.
Since a lot of admin work in small business is repetitive, like invoicing or filling in tax forms having an automated system in place will save a lot of time. Smart contracts can be used not only for automating the process but since it adds security the ability to delegate this work frees up time for the business owner. It gives you peace of mind as you know can’t steal from you.
Blockchain is the driving force behind popular cryptocurrencies like bitcoin. As a business, if you start accepting Bitcoin as a form of payment from your customers you will notice the extremely low transaction fees if any at all are charged. This is because cryptocurrencies cut out the middleman out and all the money does directly to you. This saves your business thousand as you avoid many banking fees.
Resolve disputes with customers
Any business owner will know that sooner or later disputes between the business and customers will arise. In many cases, it’s a misunderstanding so have a blockchain-based system in place will help clarify and misunderstanding. A blockchain-based management system has the ability to track products from when they were acquired to when they are sold. This gives you the ability to see if the problem was caused by you or the customer is the one at fault. With a system like that in place, the number of chargebacks will dramatically reduce.
A major huddle for many small businesses or startups is their ability to raise money for the business ideas they want to implement. Thankfully blockchain has a potential solution for this as well.
ICO (Initial coin offering) is a sort of crowdfunding where the company looking for funding has a service, product or app launch a cryptocurrency, interested investors buy their coin and hope the currency does well and they get a stellar return on investment. The company holding the ICO uses the funds to pursue their business idea. If their idea does well the coin they launch will also do well which will please their investors.
ICOs are used by startups to bypass the rigorous and regulated capital-raising process required by banks, this opens up a new avenue for funding for anyone with a great business idea.
As we can see that blockchain can be used by small business. I hope the information provided was helpful and it encourages you to consider blockchain as an option in your future ventures.