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CartelCoin is an innovative business model that aims to leverage the benefits of the blockchain and smart contract functionality to revolutionize e-commerce transactions. The platform will facilitate the direct sales of goods from the manufacturer to individual consumers at wholesale prices by combining the buying power of shoppers on a global scale.
The traditional retail model is gravely in need of a disruption. The introduction of internet-based e-commerce was a great step forward, accelerating and streamlining product dispensation and delivery process. But due to its centralized architecture, it is by no means a sufficient fix for the existing supply chain model.
Most of the issues surrounding the system have to do with the use of third-party intermediaries between the manufacturer and consumer. These include security issues related to data breaches, high transaction costs, extended and expensive transaction reversal procedures and logistical challenges among others. Unfortunately, the consumer bears all the costs that result from the system’s inherent weaknesses.
Apart from the intermediary expenses, retail prices are in most cases almost double the value of wholesale rates due to a host of factors including packaging, transport, display, personnel and rent.
The CartelCoin Solution
CartelCoin proffers a blockchain solution that will address all of the above issues and offer numerous advantages to all the parties involved in the proposed supply chain model. The platform is built on the Ethereum blockchain and uses a decentralized app to connect consumers and manufactures.
The project initially intends to offer technological products and electronic devices but will with time include vehicles and even property when the model incorporates a lending facility.
How it Works
The CartelCoin Platform comprises two major constituents:
A Consumer Portal
This is a merchant interface that can be used on both PCs and mobile devices. It will feature embedded smart contracts to execute transactions and a purchase system that links consumers from all around the globe to manufacturers and wholesalers.
A Business Portal
The model will also incorporate a B2B platform to enable companies to pool their buying power and make the most of the economies of scale and the cost reductions that they can get.
Moreover, the platform will feature wallets to enable the movement of tokens for transactions and currency exchanges. It will also have API plugins to allow for integration with other platforms and websites.
CartelCoin will charge a flat rate of 1% from sellers and 1% from buyers. In the initial stages, these fees will be pumped back into the system after reducing operational expenses incurred. The essence of this is to increase the value of the token without impacting the process of goods.
Other details such as the consensus protocol to be used on the platform, transaction management and identity verification are yet to be determined.
Unique Highlights of the CartelCoin Concept
- Economies of Scale for Individual Buyers
The current supply chain model is littered with unnecessary expenses that reflect on retail prices. CartelCoin offers a self-governing ecosystem that obviates the need for third parties between the manufacturer and consumer and subsequently reduces these unnecessary costs.
Manufactures place small margins on their costs of production and rely on the volume sales and economies of scale to turn a profit. Their access to the final consumers of products is however limited, making it necessary to woo wholesalers and retailers so as to turn a profit.
At the same time, consumers are always looking for the cheapest option available but as it is, they cannot reach the minimum order threshold required to purchase directly from the manufacturer.
But using CartelCoin, every manufacturer or wholesaler will now be able to set an appropriate price to volume ratio that will appeal to the global consumer base for products.
The blockchains’ smart contract technology, CartelCoin, will enable individual shoppers to place their orders and then pool these to meet the wholesale purchase threshold. The individual orders from thousands of buyers around the globe are then presented to the manufacturer as a single bulky order allowing them to apply a high volume discount.
In essence, this means that individual consumers no longer have to pay for every step of a meaningless supply chain. It will also cut down marketing and handling expenses that manufacturers incur in a bid to push volumes and remain profitable.
- Integration with Major e-Commerce Portals and Payment Systems
The CartelCoin platform is planning to integrate with existing wholesalers such as Amazon, Shopify and Alibaba and social networking platforms like Facebook, WeChat, Kakaotalk and WhatsApp in order to maximize its reach. This will make it possible for existing customers and traders on those platforms to take advantage of the proprietary utility in this model.
Moreover, CartelCoin will allow major digital currency wallets to operate within the platform and will also work hand-in-hand with cryptocurrency exchange platforms.
- High Security
When consumers make orders, their payments for goods are placed in escrow and will only be released when all transaction conditions have been met. Purchase requirements could include order size, price, dispatch and shipping. As soon as the minimum order quantity and other relevant conditions have been met, the smart contract automatically executes the order at the specified discount price.
The funds remain locked up in escrow, but are in the buyer’s control until the seller dispatches goods to a pre-specified logistics company. Only after an order is fully executed are funds transferred. The smart contract also offers protection from delayed delivery by incorporating discounts for a default on the stipulated timeframe.
In addition to this, the system uses a cryptographic approach to protect its users’ data. In spite of having a public and transparent ledger allowing for transparency, the blockchain technology is still impervious to hacking.
- An Eco-friendly Choice
The ecological impact that results from the current pointless supply chain cycle takes a toll on the environment. Goods at times take a trip around the world only to end up being sold in their origin country due to inefficiencies in the existing models.
The CartelPoint system offers an eco-friendly alternative that cuts down the consumption of natural resources and carbon emissions.
The platform’s token, CartelCoin (CC), is based on the ERC-20 protocol and will have a hard cap of 100 million CC. The coin has a genuine application in the market as it will serve as the medium of exchange on the platform. This will make it easy for users around the globe to trade conveniently as it eliminates the need for currency conversions and reliance of the system on legacy financial institutions.
As mentioned above, transaction fees on the model will be pumped back into the system and distributed to token holders in accordance with the value of their holdings. The project has scheduled an ICO fundraiser at the end of February.
Disruption to the Current Outmoded Retail System
The CartelCoin model is a welcome disruption to the current outmoded retail system. It addresses the major inefficiencies in the supply chain and offers a viable solution that is set to reduce purchase costs for consumers as well as advertisement and handling costs for manufactures by eliminating unnecessary middlemen.
It offers a self-governing approach based on the blockchains’ smart contract features and will integrate with existing platforms to ensure a wide reach and convenient access for a global user base.