The food people consume in the modern age goes a long way from a farmer to the consumer. Often there are many middlemen and intermediary businesses that facilitate the processing and marketing of the products and take a big portion of the proceeds. One of the best parts of the blockchain technology is that it eliminates the need for such middlemen leaving the producers of the goods with a bigger share of income. eHarvestHub tries to solve this problem with smart contracts and Blockchain protocols.
The decentralization of such chains not only changes the distribution of profits but also offers more transparency. Today, because large retailers aggregate products from different distributors, who in turn might have multiple suppliers, consumers have no way of knowing where their products came from. With blockchain, all products are registered on a public ledger and consumers can track each product all the way to its producer. In addition, they can get information on the farmer and if they feel a certain type of loyalty, it is even possible to incentivize the farmer with cryptocurrencies. This increases the transparency in the whole chain and is also a measure of security if a product turns out to be of a sub-par quality. Producers also will have more incentives to differentiate their products with higher quality.
eHarvestHub is a great solution for small farmers and truckers as well as for the consumers. In addition to increasing the share of profits, the system also offers farmers easy access to the grocers and truckers who move the products.
The company has raised $1.2 million from investors VenturesLab Fund and Kaiwu Capital to build the technology for the platform. As a result, they have an operational platform ready for farmers to use.
EHH token is the main transaction currency in the system. It can be used to make purchases in eHarvestHub. The company says it will also allow peer-to-peer payments within the system. Because data can be easily timestamped on the blockchain, fraudulent food labeling will be reduced as consumers will be able to check the true sources of the products. In addition, with the help of smart contracts, there will be a higher degree of coordination between farmers and merchants.
The idea, in theory, seems like it targets a real business need and would, in fact, eradicate a lot of transparency problems in the food distribution chain. Nevertheless, it is a very hard task to tackle. The business that the project is trying to distract has been established for a long time. There is certain synchronicity and structure to the market that both retailers and farmers have been used to. To make them switch to another business model would require a lot of incentives and guarantees.
eHarvestHub’s business model does not clearly show how it will go about substituting the existing chains. Although it could truly be profitable for farmers if their businesses switched to this model, they might not decide to go through with the transitions unless offered some special incentives, which the project does not consider for the time being.