Chain gang small enterprise, blockchain collaborations and textile recovery in the circular economy

The fashion supply chain is a complex network of stakeholders, connections and resources that coalesce for the production, trade and (sometimes) recovery of textile merchandise. This dense fashion supply system frequently conceals innumerable harmful activities including the questionable procurement of raw materials, disputed transactions, and improper labour practices. Within this opaque landscape, the emerging backend technology of blockchain is proposing mechanisms to make supply chains more transparent and incentivise circularity. However, despite the possibilities, in its current state of development, blockchain technology presents as many shortcomings as advantages. Blockchain’s disadvantages include lack of interoperability, risk of erroneous data input and difficulty achieving cooperation among competing parties. Furthermore, the ideal blockchain implementation of full-scale transparency would require widespread adoption and stakeholder collaboration for the system to operate efficiently. Indeed, blockchain cannot exist without cooperation. This study sets out to investigate the level of cooperation required for the effective implementation of blockchain for transparency along the fashion supply chain. The study finds that many of the current use cases of blockchain in the fashion supply chain are limited to private, permissioned blockchains – thus effectively shutting out other players. Through a qualitative approach this investigation examines a proof of concept (POC) within the small to medium enterprise (SME) context. The study demonstrates that regardless of the complexity (and immaturity) of blockchain technology, SMEs already possess agility and strong business partnerships that are also bound by shared values. This paper adds to the growing literature on emerging blockchain technology applications, specifically in relation to the fashion supply chain and its potential to facilitate circular economy solutions in the SME sector.