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Coordination through revenue sharing contract in an E‐commerce supply chain with consumer preference

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Listed:
  • Aijun Liu
  • Dengxue Li
  • Miao Jie
  • Zengxian Li

Abstract

The decision‐making and coordination of an e‐commerce supply chain (ECSC) with consumer preferences are studied. In this paper, the ECSC, consisting of a single manufacturer and a single e‐commerce platform, is considered, and the optimal decisions are made for two scenarios, namely, decentralized and centralized decision models. Then, a comparative analysis is performed for two models. The coordination mechanism of “revenue sharing” is proposed based on the decentralization, and finally, a numerical analysis is used to verify the conclusions. The theoretical results show that the e‐commerce platform is less profitable than the manufacturer because of its economies of scale. Interestingly, the quality of e‐commerce services under decentralized decision is instead the highest, and improving the service level of e‐commerce does not always benefit e‐commerce platforms. Meanwhile, a revenue sharing contract will reduce the price and profit gap between the manufacturer and the e‐commerce platform.

Suggested Citation

  • Aijun Liu & Dengxue Li & Miao Jie & Zengxian Li, 2022. "Coordination through revenue sharing contract in an E‐commerce supply chain with consumer preference," Managerial and Decision Economics, John Wiley & Sons, Ltd., vol. 43(6), pages 2467-2479, September.
    • Handle: RePEc:wly:mgtdec:v:43:y:2022:i:6:p:2467-2479
    DOI: 10.1002/mde.3538
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