Sourcing strategies for mixed‐component products considering the risk of external procurement and consumer information perception

Abstract Manufacturers employing dual‐sourcing strategies produce mixed‐component products, leading to consumer unawareness about these products. Motivated by this, this paper explores the sourcing strategies of competing manufacturers producing mixed‐component products, with a focus on consumer perceptions of brand value and sourcing risk. Considering the manufacturers can choose between external‐sourcing, internal‐sourcing, or dual‐sourcing strategies, this paper identifies the optimal sourcing strategy based on the proportion of external sourcing, sourcing risk level, and internal production costs. It also explores the impact of information transparency, specifically blockchain adoption, on these sourcing strategies. Notably, the findings reveal that blockchain adoption broadens the applicability of dual sourcing. The effect of increasing brand value differences on the preference for dual‐sourcing procurement varies depending on the presence of blockchain. Without blockchain, high risk increases brand value differences and then favors dual sourcing. However, with blockchain, when risk is high, increasing brand value differences make dual‐sourcing procurement less advantageous.