Industry News Archives - Urish Popeck

Blockchain And The Real Estate Industry: What’s To Come?

Posted on November 2021November 2021 by info

What’s to come for blockchain and the real estate industry? Blockchain is an innovative type of distributed ledger technology (DLT) with the potential to drastically change the real estate industry. Over the past decade, blockchain has been used to secure payments, optimize the supply chain and connect buyers and sellers in new ways. Because it forms a decentralized, immutable record, blockchain has many uses for leasing, purchases and sales transactions. Eventually, blockchain will transform how owners, buyers and lessees transact by facilitating more secure money transfers, property registrations and signed agreements.

So, why hasn’t blockchain taken off?

When it comes blockchain technology, there are two major hurdles to overcome before it can be widely adopted. One, is poor understanding of the technology and regulatory uncertainty. Two, blockchain has the potential to be the next step in the real estate industry’s technological evolution. Be mindful, clearing these hurdles will take time.

Insufficient knowledge and information about the technology

People have grown more comfortable and confident conducting real estate transactions online. However, people are still a little wary. The lack of standardization in the industry also makes it difficult to implement these blockchain transactions. Blockchain adoption across the industry requires increased education about the technology and a stronger digital foundation for the network.

Regulatory uncertainty

Federal and state lawmakers have introduced blockchain-related legislation, which addresses trust concerns by providing guidelines for cryptographic signatures standards for smart contracts and record keeping. As blockchain grows in popularity, it has highlighted the lack of regulation around DLT. Standardization could help drive widespread adoption in commercial real estate. Although, if restrictive regulations are put in place, that could limit blockchain’s utility and benefits.

The global blockchain market is expected to grow from $3 billion in 2020 to $39.7 billion by 2025 (according to data from Markets and Markets). While external factors may cause an initial slowdown in adoption, there are opportunities to create efficiencies that can help drive blockchain implementation in the commercial real estate space. Here are four ways organizations can implement blockchain to make projects, business applications and transactions more efficient.

Track and Trace

Track-and-trace capabilities allow individuals to view historical and real-time lifecycles of products in the supply chain by tracking their origin, current location and historical status, in addition to the environmental conditions to which they have been subjected. Construction materials, including industrial building materials and manufactured goods, can be tracked using blockchain.

The use of blockchain to identify where all materials in a supply chain are located is known as “geo-contextual automation.” Along the supply chain, track-and-trace capabilities provide transparency as to where various products are sourced, when they are manufactured, the material composition and the environmental impact associated with production. This is especially important given that material is often uniquely produced for a specific project. Losing track of one key material can upend the schedule and increase project costs. If an issue arises, track-and-trace capabilities can easily identify it.

Track and trace also allows insurance carriers to better assess the risk of insuring a property based on location, flood plain, building materials and prior claims.

Title Issuance

Blockchain technology will change the future of title issuance. When real estate transactions take place, a new title search must be executed to identify any encumbrances or situations that may impact the transaction. These processes can be automated by blockchain technology with the results stored securely and transparently. Manual processes, such as surveys, would still need to be conducted, but blockchain technology can capture and track the results and verify that the survey was performed by an accredited organization, which can ultimately help prevent title theft.

Fractional Ownership

Implementing blockchain can also help categorize fractional ownership in real estate investing. Tokenization is a process that can digitally represent a real estate property. This allows for smaller investors to access real estate investments that may have initially required significant capital. Token exchanges such as tZERO make the buying and selling process easier for investors by facilitating trading and investing on a digital platform.

Sustainability and ESG

Consumers and investors are increasingly interested in organizations’ sustainability practices. Public and private corporations are adopting blockchain solutions to help track their carbon footprint. Likewise to establish a role in the climate crisis and commit to net zero greenhouse gas emissions. An increase in federal and state regulations around blockchain is accelerating the adoption of blockchain in the environmental, social and governance (ESG) space, as it can help ensure data security, chain of custody and supply chain integrity. Blockchain technology can also provide immutable and transparent records for interested parties to track an organization’s waste and environmental impact.

Blockchain technology establishes an audit trail. This is essential in order to verify data being reported out. This is expected to undergo increasing scrutiny in the near future as a result of SEC disclosure requirements. In this way, blockchain functions as an attestation tool to help increase the accuracy, transparency and consistency of financial reporting and ESG practices.

The Future of Blockchain in Real Estate

Implementing these practices can lay a transformative foundation for adoption of blockchain technology in the real estate industry. As end users, lawmakers and regulators become more knowledgeable and encourage implementation there can be potential benefits. Adoption across the industry will enable improved security, transparency and convenience for leases and transactions.

Q&A: Breaking Down The Chip Shortage

Posted on October 2021November 2021 by info

Whether you’re the CEO of a manufacturing firm struggling to gain access to the materials needed for your production process or a consumer unable to find that new car you’ve been planning to buy — or both — you’ve likely seen the effects of the chip shortage firsthand.

As we enter the holiday season with no end in sight for the shortage, people everywhere are asking themselves: What’s going to happen next?

Eskander Yavar, BDO’s National Manufacturing Practice Leader, sat down with Tom Stringer, BDO’s Site Selection & Incentives Practice Leader, to dig deep into the chip shortage and answer some pressing questions: What’s causing it, how long will it last and why are there outsized impacts for the automotive sector?

Eskander Yavar: What caused the chip shortage?

Tom Stringer: Believe it or not, industry reports dating back before COVID-19 warned of the risk of a pending shortage, as demand for 200mm manufacturing equipment — which is critical to manufacture chips — outpaced production. Shortly after the pandemic hit, its disruption was immediately clear, as the demand for digital products and services dramatically increased and production lines were shuttered globally. Even though manufacturers and tech companies began to stock up on semiconductors in hopes of withstanding the storm, the spike in need for chips has yet to decline.

Eskander: Speaking of the evolving digital environment, where can the average consumer expect to find chips in their day-to-day products?

Tom: You’d be amazed — there are chips in products you wouldn’t suspect, including toothbrushes, washing machines, children’s toys and more. More apparent items include laptops, cellphones, cars and smart home appliances. The list goes on. And the number of chips per product vary by the complexity of its capabilities. For example, cars today come with a slew of new digital features requiring hundreds of chips and integrated circuits per vehicle. Additionally, with the expansion of artificial intelligence (AI) and the Internet of Things (IoT), the need for chips in day-to-day items is growing exponentially.

Eskander: Can you explain why the chip shortage has affected the automotive sector so significantly and how companies have responded?

Tom: At the outbreak of COVID-19, demand for cars dropped pretty drastically — after all, we were under stay-at-home orders, and daily commutes to work and school were replaced with virtual solutions. And above all, people were concerned for their health and didn’t want to risk travel, even domestically. For the average consumer, cars were no longer as much of a necessity. This is in addition to production shutdowns that idled the industry and reduced the available supply of new product. But as restrictions eased, cases leveled and vaccines became available, consumers were ready to spend the discretionary cash they’d saved over the past year. At the same time, many were looking forward to planning road trip vacations in lieu of air travel.

But chip production still hadn’t bounced back since the pre-COVID-19 demand surges. Dealership lots emptied quickly. As a result, many automotive manufacturers significantly cut production targets, and some temporarily shut down facilities or slow-rolled production, while others are rationing their chip supply for their more expensive models to capitalize on profit margins. In some cases, consumers have had to absorb the costs, whether by waiting additional months for production or paying more for models available.

Eskander: It’s important to note that although this disruption is severe, the automotive sector only makes up a portion of chip manufacturers’ customer base. Consumer electronics, some of which you previously listed, and tech companies are facing similar challenges. When can we expect the chip shortage to subside?

Tom: Unfortunately, we’ll likely continue to see its disruption for the next four to five years until production capacity returns. And in the second half of the decade, manufacturers will need to prioritize quality control and verify the legitimacy of their chip supply. Any time there’s heightened demand, there’s fraud right behind it. We’ll likely see counterfeit chips enter the market and our supply chains, which will cause cascading issues until verifiable and certified manufacturing capacity catches up to demand.

But the good news is there are solutions on the horizon. There’s legislation called the CHIPS for America Act, which is a Trump-era policy that the Biden administration has doubled down on. Its goal is to bring as much chip manufacturing technology to the U.S. as possible, because so much of its production and sourcing comes from international suppliers.

U.S. chip manufacturers have an opportunity to capture federal financial incentives by building new production capacity in the U.S. or repatriating existing capacity. Some have already made substantial investments in chip facilities and new 200mm equipment, but they’ll need to assess location criteria and capitalize on incentive savings to maximize value.

Eskander: It sounds like solutions will require considerable funding. In the meantime, chip manufacturers can consider refurbishing existing equipment to improve capacity. Nevertheless, it’s good to know there’s optimism.

The bottom line

The chip shortage isn’t going away, and its effects will ripple through global supply chains for years to come. Manufacturers must respond to the current impacts while also building chip shortage considerations into their business plan for the years ahead.

Consider these key steps to help preserve business continuity and respond to the ongoing impacts of the chip shortage:

Stay up to date on changing legislation and incentives related to the chip shortage to ensure you’re taking advantage of all possible opportunities to protect and strengthen your business.
Build additional security measures into your supply chain now to reduce vulnerability to fraud in the future.
Proactively communicate with your investors so they understand the impact of the chip shortage on your business and what that will mean for your business outlook over the coming months.
If you haven’t already, invest now in expanding your manufacturing capacity.
Incorporate considerations related to the chip shortage in your business continuity planning.

Restaurant Technology Series Part 1: The Restaurant of the Future

Posted on October 2021October 2021 by info

More than a year ago, no one could have predicted the unprecedented challenges faced by so many restaurants around the world due to a major global pandemic. Customer demand for convenience and flawless digital experiences are on the rise and further fueled by the pandemic. How can restaurants improve the new generation customer experiences using these new demands and digital ecosystems?

As a restaurant owner or operator, you need to look for fresh perspectives as you plan your way forward to remaining successful in the business. Some of the things you can look into include changes in business models that came about as a result of the pandemic, customer behaviors and dining habits.

As long as concerns about being exposed to COVID-19 remain, people are likely to continue opting for the payment and ordering trends we’ve seen since the onset of the pandemic such as delivery and pickup.

Read on for some insights into what the restaurant of the future might look like.

Digital Experiences will continue to evolve

Without a doubt, digital is a main component of the transformation of the restaurant industry. Online ordering and payment are here to stay. It has proved to be profitable, and it also eliminates too much dependence on third parties for sales, marketing and customer engagement.

Besides interacting with their customers, restaurants will continue to develop digital experiences that are fun and easy to use. This will consequently increase customer loyalty.

The digital evolution will replace the conventional point of sale system as we know it. Customers will order and pay for their food via their smartphones, whether dining in or ordering take-out. The pandemic has accelerated this trend. For instance, some restaurants have been providing their dine-in customers with a QR code which they scan to access the menu, place an order and pay.

The digital takeover has also seen menus adjusted and optimized for online platforms. Fewer menu options have been offered on these platforms to reduce food process, improve food quality and simplify operations.

Health concerns will remain a major factor

Restaurants will endeavor to do everything they can to make their customers comfortable by constantly enhancing their safety and hygiene practices.

Some of the things to expect include increased adoption of contactless payment and ordering, and modification of operations to include hygiene practices that customers can actually see, to give them a sense of safety. Hands-free handwashing stations and hand-sanitizing areas will become normal for any restaurant. It will also be vital to have an employee responsible for hygiene stations and maintenance in the restaurant.

We could also expect the introduction and adoption of new technologies like the UV-C light for disinfecting high-touch surfaces like POS touch screens.

Flexible seating in line with social distancing guidelines

Moving forward, it will be crucial to device creative ways of maximizing space while maintaining social distance. For example, a group table meant to seat people together will have dividers to separate people as required. Outdoor seating could also become part of the main floor plan.

Multiple for friends and family

Customers will want to dine together in groups. Some of the ways restaurants can approach dine-in for such groups include setting up private reserved areas, specialty demos or cooking demos. Restaurants will also have to support friends and family that want to eat restaurant-quality food at home. For instance, they can provide a meal pack for curbside pick-up and provide video recipes and a phone number of an employee to guide them if they get stuck.

Versatile kitchens

Kitchens are likely to become more productive and compact. There will be a need to design flexible kitchens so as to minimize expenses whenever there’s a major menu overhaul.

Popular trends caused by the pandemic will continue to grow

Such trends include delivery, curbside, takeout and drive-through orders. Restaurants will become very proficient at improving contactless operations for their customers who love convenience. This will involve covering all the intricate detailed in developing seamless systems such as customer education, staff training and aligning processes.

The restaurant of the future is already here. Customers are excited about going back to dining in with their family and friends again. However, this is being done gradually and cautiously as we get through the pandemic. Our experience with Covid has changed our behaviors and expectations which have had an impact on how restaurants operate. The restaurant of the future will not be the same again and it will have to pay close attention to both the customer and operator needs.