TITLE:
Adopting Blockchain in Fresh Supply Chains: Low or High Level?
AUTHORS:
Guifang Feng, Zhenzhong Guan, Jianbiao Ren
KEYWORDS:
Fresh Supply Chain, Information Asymmetry, Blockchain Technology, Retailer Competition, Cost-Sharing
JOURNAL NAME:
Theoretical Economics Letters,
Vol.14 No.6,
November
11,
2024
ABSTRACT: This study addresses the significant challenge posed by information asymmetry in the fresh supply chain, which severely impacts consumers’ online shopping experience and presents major challenges for online fresh retailers and suppliers. Leveraging the authenticity and traceability of blockchain technology, we propose an innovative solution that introduces blockchain to help consumers access product quality information. The study analyzes how two competing retailers (an incumbent and a new entrant) adopt varying degrees of blockchain strategies based on different market resources to validate the technology’s value in the fresh supply chain. The findings suggest that, in certain cases, when the incumbent retailer adopts blockchain to a high degree, both parties can achieve a win-win outcome, generating a blockchain spillover effect influenced by channel competition. Interestingly, the impact of information asymmetry on retailer profits follows a non-linear trend, where increased information asymmetry can optimize profits under competitive conditions. Suppliers and incumbents must balance operational costs and blockchain benefits to decide on the degree of adoption. New entrants can leverage the incumbent’s blockchain spillover effect or participate in a consortium blockchain to share costs, enabling them to benefit from blockchain technology and achieve win-win outcomes across supply chain members. This study provides guidance for fresh supply chain participants, encouraging them to explore collaborative blockchain models, reduce costs through strategic alliances, and enhance supply chain efficiency for mutual benefit.