The Interaction Between Manufacturer Encroachment and Platform Service Investment under Different Sales Modes

To explore the interaction between manufacturers' channel encroachment decisions and platforms' service investment strategies under different sales models, a supply chain model with one manufacturer and one e-commerce platform is developed. Under both reselling and agency modes, eight game models are established by considering the platform's service investment and the manufacturer's offline channel. Equilibrium solutions are derived using backward induction for comparative analysis. The results show that: (1) Under reselling, platform service investment discourages manufacturer encroachment. Under agency, however, when channel competition is weak and the commission rate is high, such investment may encourage encroachment, leading the platform to choose "strategic non-investment" to avoid this risk. (2) The commission rate is usually the key factor in the platform's choice of sales model. However, when channel competition is moderate or high and encroachment costs are low, the platform may shift from agency to reselling as the commission rate increases. (3) The platform's model choice does not always maximize the manufacturer's profit. Alignment occurs in agency mode under a moderate commission rate, and in reselling mode when the commission rate is high with moderate or intense channel competition. In other cases, their preferences are misaligned.