Optimal joint decision of information disclosure and ordering in a blockchain-enabled luxury supply chain

Zhiwen Li (), Xianhao Xu (), Qingguo Bai () and Cheng Chen ()
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Zhiwen Li: Huazhong University of Science and Technology
Xianhao Xu: Huazhong University of Science and Technology
Qingguo Bai: Qufu Normal University
Cheng Chen: Jianghan University

Annals of Operations Research, 2023, vol. 329, issue 1, No 44, 1263-1314

Abstract: Abstract This paper explores the optimal joint decision of product information disclosure and ordering in a blockchain-enabled luxury supply chain. Using analytical models, we investigate the optimal joint decision of information disclosure and ordering under three scenarios (i.e., wholesale contracts only, revenue-sharing (RS) contracts only, and a hybrid of these two types of contracts). Furthermore, we extend our study to examine the impacts of the number of competing retailers and the retailers’ fairness concerns on supply chain members’ optimal decisions. Lastly, the theoretical results are checked and illustrated by numerical examples with sensitivity analysis. The main findings are as follows: (1) As the proportion of information-sensitive consumers in the market increases, the level of product information disclosure of supply chain members increases in varying degrees, while supply chain members’ order quantities and profits first decrease and then increase in varying degrees. (2) When a RS contract is acceptable for all supply chain members, all members benefit from the cooperation between the manufacturer and retailers. (3) Although all supply chain members may benefit from an increase in the number of retailers, when the number of retailers is greater than a certain threshold, retailers would be caught in a “prisoner’s dilemma” of product information disclosure due to consumer information overload. Moreover, to maximize business profits, manufacturers should sometimes strictly limit and control the number of their reseller partners, rather than blindly expand their markets. (4) Retailers may benefit from their own fairness concerns if and only if the level of fairness concerns is sufficiently low, otherwise such concerns would be harmful to all supply chain members.

Keywords: Blockchain technology; Information disclosure; Wholesale and revenue-sharing contracts; Luxury supply chain; Newsvendor model (search for similar items in EconPapers)
Date: 2023
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DOI: 10.1007/s10479-022-04703-6

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