Optimal blockchain adoption and financing strategies in an outsourcing remanufacturing supply chain

Abstract Outsourcing remanufacturing is an environmentally friendly production method and has been widely studied. Because consumers lack trust in the quality of remanufactured products (RPs), introducing blockchain technology (BT) into the remanufacturing channel can alleviate consumers’ distrust about the quality of RPs. Considering that the third‐party remanufacturer (TPR) may have insufficient initial capital, this paper focuses on investigating the TPR's optimal blockchain adoption strategies and financing options. We have the following main findings: (i) Consumers’ high preference for RPs can motivate the TPR to opt for a trade credit, while high financing rates can increase the possibility of the TPR's choice of a bank credit; (ii) the TPR adopts the BT only when the blockchain usage is cheap or the consumers are highly sensitive for BT; (iii) the cost and revenue‐sharing contracts in the supply chains may lead to higher profits both for the OEM and the TPR.