Achieving Triple Benefits in a Platform-Based Closed-Loop Supply Chain: The Optimal Combination between Recycling Channel and Blockchain

Abstract

In order to solve the problem of false recycling, where the real recycling volume does not match the theoretical one, blockchain is widely used in practice due to its characteristics of transparency, traceability, and tamper resistance. To study its value in academics, this paper focuses on a closed-loop supply chain (CLSC) consisting of a manufacturer and an online platform. This paper discusses the implementation conditions of blockchain, the impact on enterprise decision making, and manufacturer recycling channel selection, and the triple benefits of economy, environment, and society in the CLSC with blockchain empowerment are achieved. Because of the nontransparency of the supply chain, the problem of false recycling is always present. To further solve the problem of false recycling, the recycler decides whether to implement blockchain or not. Through analysis and numerical examples, it is concluded that the greater the difference between real and theoretical recycling volumes, the greater the need for blockchain implementation. At the same time, three major effects of blockchain implementation are defined as decision incentive effect, marketing leverage effect, and incentive alignment effect, which reveal the impact of blockchain on increasing the motivation of CLSC members to make efforts, expanding the market size by improving brand goodwill, and avoiding the inconsistency between the manufacturer and the platform in the preference of the recycling channel. In addition, under blockchain empowerment, a cost range of blockchain implementation is defined, where both the manufacturer and the platform are better off, as well as the optimal recycling channel, which achieves the triple benefits of the CLSC.