IDEAS home Printed from https://ideas.repec.org/a/gam/jsusta/v16y2024i4p1535-d1337511.html
   My bibliography  Save this article

The Impact of Blockchain Technology Adoption on an E-Commerce Closed-Loop Supply Chain Considering Consumer Trust

Author

Listed:
  • Deqing Ma

    (School of Business, Qingdao University, Qingdao 266071, China)

  • Pengcheng Ma

    (School of Business, Qingdao University, Qingdao 266071, China)

  • Jinsong Hu

    (School of Business, Qingdao University, Qingdao 266071, China)

Abstract

This paper analytically explores the value of blockchain technology in building consumer trust in recyclers. We focus on an e-commerce closed-loop supply chain composed of an online platform and a manufacturer. In the forward chain, the platform selects a reselling or marketplace model to sell products. In the reverse chain, the platform collects used products, and the unknown whereabouts of the used products will cause consumer mistrust and be detrimental to the corporate image. Blockchain technology can address these challenges by improving the visibility of the recycling chain. By constructing differential game models, we specify the conditions for blockchain implementation and explore its impact on the online sales model choice and the E-CLSC performance. The findings show that the manufacturer consistently benefits from blockchain technology, while the platform decides to adopt it when the long-term profits outweigh the initial investment costs. Interestingly, the sales model selection will not change with the advent of blockchain technology. We further show the benefits of blockchain-enabled recycling and provide tangible insights for related practitioners.

Suggested Citation

  • Deqing Ma & Pengcheng Ma & Jinsong Hu, 2024. "The Impact of Blockchain Technology Adoption on an E-Commerce Closed-Loop Supply Chain Considering Consumer Trust," Sustainability, MDPI, vol. 16(4), pages 1-41, February.
    • Handle: RePEc:gam:jsusta:v:16:y:2024:i:4:p:1535-:d:1337511
    as

    Download full text from publisher

    File URL: https://www.mdpi.com/2071-1050/16/4/1535/pdf
    Download Restriction: no
    File URL: https://www.mdpi.com/2071-1050/16/4/1535/
    Download Restriction: no
    ---><---

    References listed on IDEAS

    as
    1. Suvrat Dhanorkar & Karen Donohue & Kevin Linderman, 2015. "Repurposing Materials and Waste through Online Exchanges: Overcoming the Last Hurdle," Production and Operations Management, Production and Operations Management Society, vol. 24(9), pages 1473-1493, September.
    2. Işıl & Vishal V. Agrawal & Atalay Atasu, 2020. "Extended Producer Responsibility for Durable Products," Manufacturing & Service Operations Management, INFORMS, vol. 22(2), pages 364-382, March.
    3. Sara Saberi & Mahtab Kouhizadeh & Joseph Sarkis & Lejia Shen, 2019. "Blockchain technology and its relationships to sustainable supply chain management," International Journal of Production Research, Taylor & Francis Journals, vol. 57(7), pages 2117-2135, April.
    4. Lin Tian & Asoo J. Vakharia & Yinliang (Ricky) Tan & Yifan Xu, 2018. "Marketplace, Reseller, or Hybrid: Strategic Analysis of an Emerging E‐Commerce Model," Production and Operations Management, Production and Operations Management Society, vol. 27(8), pages 1595-1610, August.
    5. Garud Iyengar & Fahad Saleh & Jay Sethuraman & Wenjun Wang, 2023. "Economics of Permissioned Blockchain Adoption," Management Science, INFORMS, vol. 69(6), pages 3415-3436, June.
    6. Wang, Yingli & Singgih, Meita & Wang, Jingyao & Rit, Mihaela, 2019. "Making sense of blockchain technology: How will it transform supply chains?," International Journal of Production Economics, Elsevier, vol. 211(C), pages 221-236.
    7. Brett Massimino & John V. Gray & Yingchao Lan, 2018. "On the Inattention to Digital Confidentiality in Operations and Supply Chain Research," Production and Operations Management, Production and Operations Management Society, vol. 27(8), pages 1492-1515, August.
    8. Feng, Lipan & Govindan, Kannan & Li, Chunfa, 2017. "Strategic planning: Design and coordination for dual-recycling channel reverse supply chain considering consumer behavior," European Journal of Operational Research, Elsevier, vol. 260(2), pages 601-612.
    9. Bin Shen & Ciwei Dong & Stefan Minner, 2022. "Combating Copycats in the Supply Chain with Permissioned Blockchain Technology," Production and Operations Management, Production and Operations Management Society, vol. 31(1), pages 138-154, January.
    10. Vibhanshu Abhishek & Kinshuk Jerath & Z. John Zhang, 2016. "Agency Selling or Reselling? Channel Structures in Electronic Retailing," Management Science, INFORMS, vol. 62(8), pages 2259-2280, August.
    11. Gabriella M. Hastig & ManMohan S. Sodhi, 2020. "Blockchain for Supply Chain Traceability: Business Requirements and Critical Success Factors," Production and Operations Management, Production and Operations Management Society, vol. 29(4), pages 935-954, April.
    12. De Giovanni, Pietro & Reddy, Puduru V. & Zaccour, Georges, 2016. "Incentive strategies for an optimal recovery program in a closed-loop supply chain," European Journal of Operational Research, Elsevier, vol. 249(2), pages 605-617.
    13. Qin, Xuelian & Liu, Zhixue & Tian, Lin, 2021. "The optimal combination between selling mode and logistics service strategy in an e-commerce market," European Journal of Operational Research, Elsevier, vol. 289(2), pages 639-651.
    14. Choi, Tsan-Ming, 2019. "Blockchain-technology-supported platforms for diamond authentication and certification in luxury supply chains," Transportation Research Part E: Logistics and Transportation Review, Elsevier, vol. 128(C), pages 17-29.
    15. Andrei Hagiu & Julian Wright, 2015. "Marketplace or Reseller?," Management Science, INFORMS, vol. 61(1), pages 184-203, January.
    16. Lingxiu Dong & Puping (Phil) Jiang & Fasheng Xu, 2023. "Impact of Traceability Technology Adoption in Food Supply Chain Networks," Management Science, INFORMS, vol. 69(3), pages 1518-1535, March.
    17. Yuelin Shen & Sean P. Willems & Yue Dai, 2019. "Channel Selection and Contracting in the Presence of a Retail Platform," Production and Operations Management, Production and Operations Management Society, vol. 28(5), pages 1173-1185, May.
    18. Gal Raz & Gilvan C. Souza, 2018. "Recycling as a Strategic Supply Source," Production and Operations Management, Production and Operations Management Society, vol. 27(5), pages 902-916, May.
    19. Heydari, Jafar & Govindan, Kannan & Sadeghi, Razieh, 2018. "Reverse supply chain coordination under stochastic remanufacturing capacity," International Journal of Production Economics, Elsevier, vol. 202(C), pages 1-11.
    20. Pietro Giovanni, 2017. "Closed-loop supply chain coordination through incentives with asymmetric information," Annals of Operations Research, Springer, vol. 253(1), pages 133-167, June.
    21. Wei, Yuansheng & Dong, Yuxuan, 2022. "Product distribution strategy in response to the platform retailer's marketplace introduction," European Journal of Operational Research, Elsevier, vol. 303(2), pages 986-996.
    22. Gökçe Esenduran & Yen-Ting Lin & Wenli Xiao & Minyue Jin, 2020. "Choice of Electronic Waste Recycling Standard Under Recovery Channel Competition," Manufacturing & Service Operations Management, INFORMS, vol. 22(3), pages 495-512, May.
    23. Liu, Hengyu, 2022. "Combating unethical producer behavior: The value of traceability in produce supply chains," International Journal of Production Economics, Elsevier, vol. 244(C).
    24. De Giovanni, Pietro, 2018. "A joint maximization incentive in closed-loop supply chains with competing retailers: The case of spent-battery recycling," European Journal of Operational Research, Elsevier, vol. 268(1), pages 128-147.
    25. Stefan Hahler & Moritz Fleischmann, 2017. "Strategic Grading in the Product Acquisition Process of a Reverse Supply Chain," Production and Operations Management, Production and Operations Management Society, vol. 26(8), pages 1498-1511, August.
    26. Tang, Yanyan & Zhang, Qi & Li, Yaoming & Li, Hailong & Pan, Xunzhang & Mclellan, Benjamin, 2019. "The social-economic-environmental impacts of recycling retired EV batteries under reward-penalty mechanism," Applied Energy, Elsevier, vol. 251(C), pages 1-1.
    Full references (including those not matched with items on IDEAS)

    Most related items

    These are the items that most often cite the same works as this one and are cited by the same works as this one.
    1. De-Qing Ma & Xiao-Qing Wang & Xue Wang & Jin-Song Hu, 2023. "Achieving Triple Benefits in a Platform-Based Closed-Loop Supply Chain: The Optimal Combination between Recycling Channel and Blockchain," Sustainability, MDPI, vol. 15(5), pages 1-40, February.
    2. Ma, Deqing & Hu, Jinsong, 2022. "The optimal combination between blockchain and sales format in an internet platform-based closed-loop supply chain," International Journal of Production Economics, Elsevier, vol. 254(C).
    3. Cao, Kaiying & Xu, Yuqiu & Hua, Ye & Choi, Tsan-Ming, 2023. "Supplier or co-optor: Optimal channel and logistics selection problems on retail platforms," European Journal of Operational Research, Elsevier, vol. 311(3), pages 971-988.
    4. Matsui, Kenji, 2024. "Should competing suppliers with dual-channel supply chains adopt agency selling in an e-commerce platform?," European Journal of Operational Research, Elsevier, vol. 312(2), pages 587-604.
    5. Xu, Xiaoping & Choi, Tsan-Ming, 2021. "Supply chain operations with online platforms under the cap-and-trade regulation: Impacts of using blockchain technology," Transportation Research Part E: Logistics and Transportation Review, Elsevier, vol. 155(C).
    6. Zhang, Zhichao & Xu, Haiyan & Chen, Kebing & Zhao, Yingxue & Liu, Zhi, 2023. "Channel mode selection for an e-platform supply chain in the presence of a secondary marketplace," European Journal of Operational Research, Elsevier, vol. 305(3), pages 1215-1235.
    7. Zhang, Abraham & Wang, Jason X. & Farooque, Muhammad & Wang, Yulan & Choi, Tsan-Ming, 2021. "Multi-dimensional circular supply chain management: A comparative review of the state-of-the-art practices and research," Transportation Research Part E: Logistics and Transportation Review, Elsevier, vol. 155(C).
    8. Suyuan Luo & Tsan‐Ming Choi, 2022. "E‐commerce supply chains with considerations of cyber‐security: Should governments play a role?," Production and Operations Management, Production and Operations Management Society, vol. 31(5), pages 2107-2126, May.
    9. Yuling Sun & Xiaomei Song & Yihao Jiang & Jian Guo, 2023. "Strategy Analysis of Fresh Agricultural Enterprises in a Competitive Circumstance: The Impact of Blockchain and Consumer Traceability Preferences," Mathematics, MDPI, vol. 11(5), pages 1-18, February.
    10. Zhou, Yu & Gao, Xiang & Luo, Suyuan & Xiong, Yu & Ye, Niangyue, 2022. "Anti-Counterfeiting in a retail Platform: A Game-Theoretic approach," Transportation Research Part E: Logistics and Transportation Review, Elsevier, vol. 165(C).
    11. Zhou, Xiaoyang & Liu, He & Li, Jialu & Zhang, Kai & Lev, Benjamin, 2023. "Channel strategies when digital platforms emerge: A systematic literature review," Omega, Elsevier, vol. 120(C).
    12. Xue Wang & Deqing Ma & Jinsong Hu, 2022. "Recycling Model Selection for Electronic Products Considering Platform Power and Blockchain Empowerment," Sustainability, MDPI, vol. 14(10), pages 1-44, May.
    13. Zhang, Zhichao & Xu, Haiyan & Zhao, Yingxue & Liu, Zhi & Chen, Kebing, 2023. "Extended warranty service provision: A strategic analysis for the E-commerce platform supply chain," Transportation Research Part E: Logistics and Transportation Review, Elsevier, vol. 177(C).
    14. Zheng, Zhijun & Li, Gang & Cheng, T.C.E & Wu, Feng, 2022. "Offline supplementary service strategies for the online marketplace: Third-party service or marketplace service?," Transportation Research Part E: Logistics and Transportation Review, Elsevier, vol. 164(C).
    15. Feng, Lipan & Jin, Minyue, 2022. "Platform vs. Manufacturer: Who should implement innovation in e-commerce supply chains?," Transportation Research Part E: Logistics and Transportation Review, Elsevier, vol. 166(C).
    16. Liu, Shuai & Hua, Guowei & Kang, Yuxuan & Edwin Cheng, T.C. & Xu, Yadong, 2022. "What value does blockchain bring to the imported fresh food supply chain?," Transportation Research Part E: Logistics and Transportation Review, Elsevier, vol. 165(C).
    17. Chang, Shuhua & Li, Anqi & Wang, Xinyu & Zhang, Jiayue, 2023. "Optimal combination of platform channel contract and guarantee financing strategy in e-commerce market," Transportation Research Part E: Logistics and Transportation Review, Elsevier, vol. 172(C).
    18. Yumin Fu & Jianyun Wu & Cheng Ma & Xiaoyu Fu, 2023. "Agency, Reselling, or Hybrid: Strategic Channel Selection in a Green Supply Chain," Sustainability, MDPI, vol. 15(3), pages 1-21, January.
    19. Zhang, Tianyu & Dong, Peiwu & Chen, Xiangfeng & Gong, Yu, 2023. "The impacts of blockchain adoption on a dual-channel supply chain with risk-averse members," Omega, Elsevier, vol. 114(C).
    20. Xu, Xiaoping & He, Ping & Zhang, Shanshan, 2021. "Channel addition from marketplace or reselling under regional carbon cap-and-trade regulation," International Journal of Production Economics, Elsevier, vol. 236(C).

    Corrections

    All material on this site has been provided by the respective publishers and authors. You can help correct errors and omissions. When requesting a correction, please mention this item's handle: RePEc:gam:jsusta:v:16:y:2024:i:4:p:1535-:d:1337511. See general information about how to correct material in RePEc.

    If you have authored this item and are not yet registered with RePEc, we encourage you to do it here. This allows to link your profile to this item. It also allows you to accept potential citations to this item that we are uncertain about.

    If CitEc recognized a bibliographic reference but did not link an item in RePEc to it, you can help with this form .

    If you know of missing items citing this one, you can help us creating those links by adding the relevant references in the same way as above, for each refering item. If you are a registered author of this item, you may also want to check the "citations" tab in your RePEc Author Service profile, as there may be some citations waiting for confirmation.

    For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: MDPI Indexing Manager (email available below). General contact details of provider: https://www.mdpi.com .

    Please note that corrections may take a couple of weeks to filter through the various RePEc services.

    IDEAS is a RePEc service. RePEc uses bibliographic data supplied by the respective publishers.