Enhancing Supplier Visibility & Risk Management in Complex Supply Chains

Aarti Tiwari

. 2025-03-10

The Challenge: Lack of Visibility till Tier-N Suppliers

Modern supply chains are vast and constantly evolving. On average, a company may have three or more tiers of upstream suppliers, but visibility beyond Tier-1 is often limited. The deeper the supply chain, the harder it becomes to track supplier dependencies, assess risks, and ensure compliance.

Regulations such as EUDR (European Union Deforestation Regulation) require organizations to discover, assess, and document supplier risks at every interaction. However, without automated tracking and dynamic risk evaluation, businesses struggle to maintain compliance, leaving them exposed to legal, financial, and operational threats.  

Key Risks of Supplier Non-Visibility

1. Operational Risks – Unexpected supplier failures lead to disruptions in production and delivery.
2. Financial Risks – Hidden dependencies on unstable suppliers can cause unexpected cost spikes.
3. Reputational Risks – Association with non-compliant or unethical suppliers can damage brand credibility.
4. Structural Risks – Over-reliance on a small pool of indirect suppliers increases supply chain fragility.
5. Country-Specific Risks – Exposure to geopolitical tensions, regulatory changes, and natural disasters creates uncertainty.
6. Industry-Specific Risks – Compliance violations, such as deforestation in agriculture or unethical sourcing in manufacturing, lead to legal and financial penalties.
7. Fiscal Risks – Sudden economic downturns, trade restrictions, and currency fluctuations impact procurement strategies.

The Impact: How Non-Visibility Leads to Major Supply Chain Failures

  Without insight into Tier-N suppliers, organizations experience:

● Increased Supply Chain Disruptions – An unknown Tier-N supplier shutting down due to financial instability can halt production.
● Regulatory Non-Compliance – A supplier unknowingly linked to compliance risk can put a company at risk of violations and bans in potential markets.
● Delayed Risk Response – Without proactive risk monitoring, companies only react after a crisis, leading to costly delays.
● Higher Procurement Costs – Without supplier risk intelligence, companies may unintentionally source from unstable or overpriced suppliers.
● Missed Competitive Advantage – Organizations fail to leverage supplier diversity, innovation, and alternative sourcing strategies.

The Solution: AI-Driven Supplier Discovery & Risk Assessment

  We address the risks imposed by compliance regulations such as EUDR by helping companies understand the nature and depth of the journey a commodity undergoes before becoming part of an intended supply chain.

Our mobile-based Supplier Discovery Tool empowers organizations with real-time visibility and dynamic risk assessment:

● Automated Tier-N Mapping – Identifies indirect suppliers and their frequency of occurrence.
● Live Risk Scoring – Assesses financial, operational, and compliance risks dynamically.
● Proactive Insights – Guides procurement teams on safer, more reliable supplier choices.

Why Blockchain is Critical in Supply Chain Risk Management

  Traditional data storage methods leave room for tampering, data loss, and inefficiencies in supplier risk assessment. Blockchain technology ensures transparency, security, and auditability through:

● Immutable Document Storage – Every document submitted (such as compliance reports, supplier disclosures, and risk assessments) is securely stored on the blockchain, ensuring no unauthorized modifications.
● Tamper-Proof Risk & Compliance Records – The hash of submitted documents is stored on the blockchain, allowing verification without exposing sensitive information.

Addressing Compliances such as EUDR

  ● Deforestation Risk Analysis Storage – Blockchain records time-stamped deforestation analysis reports tied to Tier-N suppliers, ensuring data integrity for compliance with regulations like EUDR.
● Due Diligence Certificate (DDC) Logging – The DDCs generated for each consignment are recorded on-chain, providing permanent proof of compliance for audits and regulatory reporting.

Ancillary Compliance Tools

  ● EUDR Compliance – Conducts spatial analysis to detect deforestation risks in Tier-N supplier land plots.
● Seamless ERP Integration – Connects supplier insights to procurement systems for smarter decision-making.

Potential Risks Without AI Visibility

1. Operational Risk – If the supplier is suddenly banned, the company faces supply shortages, delaying production.
2. Financial Risk – Without alternative suppliers identified in advance, urgent re-sourcing leads to cost spikes.
3. Reputational Risk – If linked to non-compliant deforestation practices, the brand risks public backlash and lost consumer trust.
4. Regulatory Risk – Failing to comply with the European Union Deforestation Regulation (EUDR) could result in shipment rejections and legal penalties.

With AI-driven insights, the company proactively identifies and mitigates these risks—securing alternative suppliers, ensuring compliance, and protecting operations before disruptions occur.

Proven Industry Expertise

  We have successfully implemented supplier risk assessment in the tire, coffee, and leather industries, helping companies:

● Detect hidden risks in complex supply chains
● Enhance compliance with EUDR and other global regulations
● Optimize supplier relationships for long-term resilience

Let’s build a more transparent, risk-aware, and resilient supply chain—together.