Sustainability, Vol. 17, Pages 4841: Blockchain Investment Strategies in Co-Opetitive Supply Chain: Considering Brand Spillover Effect

Sustainability doi: 10.3390/su17114841

Authors:
Hongkun Lu
Hong Cheng

As environmental issues are of worldwide concern and consumers grow more concerned about the environment, green investments have emerged as a key factor in attracting consumers. To enhance consumer trust in enterprise investments in green and sustainable practices, blockchain technology, with its tamper-resistant and traceable characteristics, is being adopted by an increasing number of enterprises. However, the resulting spillover effect may lead to adverse consequences in a co-opetitive supply chain. This study examines a green supply chain comprising Brand O, a high brand value entity, and a contract manufacturer (CM) with lower brand value. The two parties collaborate through outsourced production while competing in the retail market. Three decision-making models were constructed, namely, without blockchain, Brand O adopting blockchain, and the CM adopting blockchain, and equilibrium solutions were derived to facilitate analysis. We find that Brand O tends not to introduce blockchain in order to avoid the loss of brand value and the spillover of consumer trust. The CM tends to introduce blockchain to enhance its products’ environmental impact and gain an exclusive competitive advantage, targeting the high-end market. These findings guide managers and practitioners in a co-opetitive green supply chain: high brand value retailers should cautiously evaluate blockchain’s impact, staying alert to risks hidden beneath benefits; upstream manufacturers can prioritize blockchain adoption for competitive advantage.

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Hongkun Lu www.mdpi.com