Investment Decision of Blockchain-Based Traceability Service Input for a Competitive Agri-Food Supply Chain

Abstract

Competitive agri-food supply chain (hereafter, AFSC) is an important component of AFSC. In a competitive environment, more and more AFSCs use blockchain-based traceability services (hereafter, BBTS) to improve the traceability level of agricultural products. The investment rules concerning BBTS and the coordination rules in an AFSC are vital issues for many firms who want to adopt BBTS. To explore these laws, we constructed two competitive AFSCs, each of which included a supplier and a retailer. Considering the new changes in consumers’ perception of product quality and safety after using the BBTS, the demand function was modified. Then we built the income functions of chain members under three situations of investment. The research found that: (1) the improvement of customers’ perceived quality by using the BBTS can increase their benefits; (2) when decision-makers want to invest in the BBTS, they should pay attention to consumers’ perceived quality safety factor for their competitive products; (3) when the investment cost is greater than its threshold value, two competitive AFSCs should invest in the BBTS together.