How digital transformation affects supply chain concentration: the case of companies listed on China’s Shanghai and Shenzhen A-share markets

Digital transformation has become essential for accelerating firm development owing to the rapid advancement of the digital economy. Using 2011–2022 data from Shanghai and Shenzhen A-share listed companies, this study investigates the underlying processes of supply chain concentration and the impact of digital transformation. The regression results, with a statistically significant and negative coefficient at the 1% level, show that digital transformation dramatically lowers supply chain concentration. This finding is consistent with various tests. Mechanism analyses reveal that digital transformation lowers supply chain concentration by enhancing corporate information transparency and information acquisition capability. The heterogeneity test results demonstrate an inhibiting effect of digital transformation on supply chain concentration that varies depending on the companies’ internal and external features. These findings further substantiate how supply chain diversification, robustness, and sustained profitability contribute to the long-term expansion of Chinese businesses through digital transformation.