If you only look at the surface of something, it’d be difficult to say if there’s any problem with it. Without diving deep into the details, problems can’t be found. The same is the case with the current e-commerce industry and platforms today. What exactly, you may ask. After all, you’ve been having a superb experience surfing through Amazon, finding products, and having them delivered to your doorstep. As we said, the surface of it doesn’t reveal a lot. It’s the “behind the scenes” part of e-commerce that is broken and in dire need of innovation.
Research shows that the e-commerce industry will reach a global market size of more than $7.5 trillion by 2025. With that big an industry, it’s strange the largest players do not seek to change the existing infrastructure. Thankfully, the advent of blockchain technology has created enormous room for innovators to change the course of e-commerce. Splyt, a blockchain startup, claims it can change the e-commerce industry for the better by using blockchain technology and its various elements to solve the existing problems.
Problems with the Ecommerce Industry
The Oligopolistic Trend
There’s no doubt that all markets consist of some small players, some big players, and some giant ones. That’s how markets work. But problems for both businesses and consumers arise when the market giants control a majority of the market and try to diminish competition.
With such a power grab over the e-commerce market, these companies hinder the growth of smaller businesses. They curb their freedom to operate independently and sell their products. Most sellers are forced to use services offered by one of the top companies. This prevents them from competing with the dominance of the bigger market players.
When only a small portion of the businesses control the market, they get to set the rules and influence the prices of products and services. Amid all this, the consumers are forced to pay higher prices.
A Sluggish Inventory Management System
Many of the well-known e-commerce marketplaces do not directly own all the products they list. Instead, smaller companies or individuals, called dropshippers, list those products and fulfill the placed orders. Now, imagine being one such dropshipper whose products are listed across multiple markets or platforms, none of which are interlinked together.
The problem? The lack of an inventory management system that can be synchronized across all platforms, forcing dropshippers to manually update their inventory across each.
The trouble doubles when a product runs out of stock, but dropshippers couldn’t manage to update their inventory. There’s a chance a consumer orders a product that is out of stock. In fact, $93B of sales are lost due to out-of-stock items each year.
The Blockchain Solution by Splyt
Splyt is creating the complete infrastructure for e-commerce players of all sizes. The platform will enable businesses to grow past the current centralized market behemoths and grow their business independently in a decentralized ecosystem built on top of blockchain technology.
One of the biggest merits of blockchain is that it is a decentralized technology, meaning it has the potential to disintermediate business processes. Blockchain technology is also one of the most effective and secure ways to store data, making it a perfect fit for inventory management.
So, what’s Splyt’s solution?
Splyt intends to help brands operate without reliance on wholesale retail platforms. It has created a blockchain-powered platform where brands can directly connect their web stores to Splyt Core. When they do so, the system automatically updates Splyt Core’s blockchain with their live inventory data. They can connect with the existing retail platforms and renegotiate their profit terms, which is becoming increasingly common because of the lack of cash flow for wholesalers to purchase inventory.
Splyt proposes to bring the concept of non-fungible tokens (NFTs) to e-commerce as eNFT’s (e-comm NFT’s). Now, NFTs are crypto tokens that represent unique assets and cannot be interchanged with each other. Using a combination of blockchain inventory and eNFTs, Splyt will allow businesses to track and update their inventory in real-time across all platforms. This eNFT also enables brands to track datapoints across the lifecycle of a product, such as resale value.
With automated real-time inventory updates across all platforms, there’s also no chance for consumers to order an out-of-stock product. This can potentially make the whole system more efficient and time-saving for both businesses and consumers.
As a decentralized platform, Splyt promises significantly lower rates for brands to connect and manage their web stores and inventories as compared to centralized services.
To further ensure that smaller e-commerce businesses get a fair chance to rise against the thrust of ecom giants and grow their business, Splyt uses a unique combination of decentralized finance (DeFi) lending model and non-fungible tokens. In simple terms, Splyt allows e-commerce businesses to get collateral-based loans to fund their operations.
Simplicity offered by Splyt
The process is supposed to be fairly simple. Splyt Core intends to assign eNFTs to represent a business’s assets on the blockchain and hold their inventory as collateral. Lenders on their platform can then agree on an interest rate with the business seeking a loan and lend them the amount against the existing collateral. Later, the loan would be repaid with the sale of each item in the inventory.
The use of blockchain by Splyt allows it to offer many more benefits over centralized wholesale platforms. These include faster payments to affiliate marketers, transparent data recording, higher security of data, and so on.
It has become increasingly difficult for small businesses to thrive in the e-commerce industry. With Splyt’s initiatives and blockchain solutions, there’s a good chance that these small businesses will have a better chance at independently growing their business and managing it more efficiently. For enterprise businesses, it creates organized infrastructures and more data points amongst other things. Now time will tell how well e-commerce businesses recognize the potential of Splyt and put it to the right use.
Recently, Splyt was mentioned in our “The Next 100x! Hottest upcoming Altcoin projects.”