Selling secondhand products through an online platform with blockchain

Shen, Bin, Xu, Xiaoyan and Yuan, Quan (2020) Selling secondhand products through an online platform with blockchain. Transportation Research Part E: Logistics and Transportation Review, 142, [102066]. (doi:10.1016/j.tre.2020.102066).

Record type: Article

Abstract

We examine the value of blockchain for disclosing secondhand product quality in a supply chain in which contributors consign secondhand products to an online platform that resells them and competes with suppliers of new products. We find that the platform is more likely to provide a uniform (differential) pricing strategy with new products when the revenue sharing portion of the consignment contract is sufficiently low (high). Moreover, surprisingly, without blockchain, the platform prefers moderately perceived and true quality secondhand products, instead of extremely high or low quality. With blockchain, the platform prefers selling low-uniqueness and low-quality (or high-uniqueness and high-quality) secondhand products. Furthermore, we find that with blockchain, horizontal integration is more effective in improving the supply chain's total profit. A win-win-win outcome can be achieved for the platform, the supplier, and consumers in a supply chain that sells low-uniqueness products.

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