Understanding Chain of Custody Logistics in Supply Chain Management

Introduction to Chain of Custody Logistics

In general, the chain of custody documentation is widely used in a variety of industries in both the public and private sectors, especially in the law and medicine field.

However, the concept is also utilized in the supply chain sector. In fact, the chain of custody acts as the core of a sustainable supply chain, which is why the chain of custody documentation is highly important for many businesses.

It offers three things: it helps increase transparency, improve efficiency, and bring more accountability to the opaque processes that occur within the supply chain. This article walks you through the chain of custody logistics, its importance, and the benefits of the chain of custody routing.

What is Chain of Custody in Logistics?

Chain of custody is known in many ways, but in business, it refers to the chronological documentation of a purchased product, from collection through continuous possession and, finally, delivery. 

It requires tracking from when the product is collected to the time of purchase. Plus, learned about the purpose of the transfer and the persons who handled the transportation. 

It is quite similar to an online purchasing experience. After a product is purchased, the customer gets a tracking number. This unique number functions as a digital passport for the product on shipment. The package gets stamped at each stop along the way. So the customer can track the shipment status in real time.

Custody documentation is a verifiable receipt that helps control inventory and transactional processes. 

Tracking the supply chains and keeping all documentation is extremely vital for government organizations, law enforcement agencies, small business owners, logistics service providers, and shipment providers.

Exploring Chain of Custody Routing and Its Significance

The chain of custody in routing covers the transportation section only. It records every transfer of evidence from person to person and every location the item passed through on its way to the final destination.

Here is how the chain of custody documentation helps run a routing business: 

1. Customers want to stay in the loop

Customers want to know where their order is and when it will be delivered. Nothing can be better than providing them with all the information. So, many delivery and transportation companies enable updated routing programs on their online portals, where the receivers can track their orders. 

2. Transparency in the supply chain

Sometimes human factors affect transportation. As you know, human performances vary from individual to individual. So, sometimes you may fail to deliver some items within the expected delivery date. This can be due to heavy orders, holidays, labor shortages, extreme weather conditions, etc.

However, the receiver will stay calm if they can track their shipment status. Detail documentation makes the supply chain more transparent and you, as a trading partner, more accountable.

3. Get rid of false claims

If your company is responsible for product transportation, you often need to show where an item is now and where it was at a particular point in time.

Let’s say a customer asks for a refund by claiming that no field employee has arrived at the delivery address. Whereas your field employee has actually made the delivery.

For customers, you may process the refund for them, as they have a valid complaint. On the other hand, your employee may not agree to refund your customer, and you are likely to lose a customer.

In case of any loss, you can easily identify the step of disruption, relocate the lost products, and take a step to resend them to the assigned delivery address. 

Hence, if your logistics management team keeps track of all distribution lines, it will be easier to eliminate false claims.

Benefits of Implementing Chain of Custody in Logistics

Every field of operation includes a chain of events. The chain could be short, simple, or complicated, involving multiple changes of ownership of an item. 

Whether it is a complex supply chain or a simple one, it is extremely important to track an item when transporting it from one location to another. Some of these benefits include:

• It allows you to trace products electronically and physically to offer better control over inventory.
• Provide a better understanding of the supply line of materials, used components, and final products. 
• Give public and private entities access to documenting their associated products and services. 
• Chronological documentation helps find out any disruption or loss.
• It helps identify the areas that create loss and delivery delays and develop the best solutions.

Chain of Custody vs. Tracking: Understand the Distinction

Chain of custody: The chain of custody includes all steps and persons who take possession of the products, such as manufacturers, processors, transporters, and exporters. 

The mining agency’s record, which has custody of minerals, should also be documented in the supply chain. This allows them to trace a material back to its origin. 

The chain of custody system is strict on the truthfulness of mineral origin claims. So, it requires a mining origin certificate, factory receipt, transport documentation, and detailed import and export records.

Tracking system: On the other hand, the tracking system monitors a package from the warehouse to the delivery destination. In the tracking system, information regarding the country of origin is mentioned on the package. However, they hardly follow the trail of mineral supply by tracking the associated chain of custody system.

Chain of custody or tracking – Which one is most preferred?

The major logistic service providers often claim they have the best tracking services and provide genuine chain-of-custody systems. But the fact is, most of them can’t provide all custody documentation details for two reasons:

• Firstly, most of their shipping containers are not sealed or tracked from access to the destination for access. 
• Secondly, the signature of the person who verifies the goods and their quantity may not be present on the package.

Without the person’s signature and identity, any delivery package can’t be part of a chain of custody rather than only a tracking system. 

It doesn’t affect the delivery of food products or regular online-purchased products. However, the distinction is extremely important when transporting drugs, weapons of mass destruction, and other counterfeit products through a global supply chain.

For the global supply chain, the chain of custody has been more widely adopted than the tracking system. 

Why? In the global supply chain, a chain of custody begins with the identity of the person who has verified the goods under the contract of carriage. 

From loading to unpacking the box of goods, every step should be verified by the associated persons. There must be signatures of the concerned persons. 

Such a detailed and strict custody system prevents fraudulent manipulation of paper documentation and improves the efficiencies in international movements.

Industry Perspectives on Chain of Custody

Different industries view chain of custody differently. Yet they all share one goal: keeping track of their items every step of the way. 

Let’s look at how various sectors handle this process.

Healthcare and pharmaceuticals

Patient safety comes first in healthcare. Hospitals track everything from blood samples to medications. They need to know who handled what and when, which helps prevent mix-ups and ensures patients get the right treatment.

For drug companies, tracking is even stricter. They must prove their medicines are genuine and stored properly. Every step from factory to pharmacy needs documentation.

Legal and law enforcement

Evidence handling in legal cases must be perfect. One small mistake in the chain can affect an entire case. That’s why police departments have strict rules about:

• Who can handle evidence
• Where items are stored
• How transfers are documented
• When and why items move locations

Food and beverage

Food safety depends on good tracking. Companies need to know where their ingredients come from. They also track storage temperatures and handling conditions, which helps them:

• Respond quickly to safety issues
• Remove unsafe products from stores
• Protect their customers
• Meet food safety regulations

Manufacturing

Modern factories track parts from multiple suppliers. They need to know which parts went into which products, which helps with quality control and recalls if needed.

Technology and electronics

Tech companies face a growing challenge with fake products. A strong chain of custody helps them prove their products are genuine. It also helps track repairs and warranty claims.

Businesses that prioritize chain of custody benefit from fewer errors, better compliance, and stronger customer trust. Whether you manage goods or services, understanding these perspectives can help you improve your operations.

Leveraging Technology in Chain of Custody

Technology plays a key role in making chain of custody processes more efficient and secure. With the right tools, businesses can track goods accurately, reduce errors, and ensure compliance.

Here’s how technology improves chain of custody:

1. Tracking systems

GPS trackers and barcodes let you monitor goods in real time. This ensures items stay on the right path and alerts you if there are delays or issues.

2. Digital records

Digital documentation replaces manual logs. This reduces errors and provides instant access to detailed information about each step in the process.

3. Blockchain technology

Blockchain is transforming chain of custody by creating tamper-proof records. Each transaction is securely stored and can’t be altered. This builds trust, especially in industries like pharmaceuticals, food, and legal services where transparency is critical.

Using blockchain ensures that all parties involved can access a single, verified source of truth. For example, a food company can trace an item’s journey from farm to store, confirming that it stayed within safety guidelines.

Technology also helps businesses analyze data. With insights from tracking systems and digital records, you can find weak points in your process and improve them.

Investing in the right tools can simplify your chain of custody and give you a competitive edge.

Get a 360-degree View of Your Logistics Process with Upper Route Planner

The prime stages of supply chains are integration, operation, purchasing, and distribution. However, the distribution part can cause some trouble if you don’t have efficient routes. It may result in a delay in transporting the goods and products.

If you opt for the best route optimization software for smooth logistics operations, you won’t have to worry about the routes, deliveries, and daily delivery operations.

The route planner helps you get a birds-eye view of your ongoing process. The admin or dispatch manager can scan reports to analyze driver performance and the history of past deliveries as well.  

Using Upper means you don’t have to be involved in manual calculations, as it uses a fully automated process. That’s right. From calculating optimized routes to delivering products on time, Upper ensures a better customer experience. Hence, the route scheduling software is capable of greatly simplifying the chain of custody logistics.

Final Thoughts on Chain of Custody in Logistics

A supply chain mainly contains suppliers and customers. So, the custody documentation tracks the movements of producers or manufacturing units, distributors, wholesalers, retailers, and customers at every step of the supply chain.

Thus, it solves any area that creates any negative influence on the product’s delivery, value, or quality. Additionally, the chain of custody routing gives a clearer picture of what is happening in the supply chain. 

If you experience routing issues daily, we recommend you use Upper. The route optimization software takes care of your entire process and helps you schedule routes for multi-stop deliveries. Try a 7 days free trial.