A Comparative Study Of E-retailing Models: Supply Chain Structure Perspective

E-retailing industry develops rapidly with a huge potential, but still faces many problems and challenges. Unlike the comparatively complete and in-depth study or practice of traditional retail, current research on e-retailing is relatively scarce. The main issues that manufacturers and retailers concern is no longer whether to select electronic channels or not, but how to effectively select and develop electronic channels. Theoretical study on e-retailing models could help companies recognize different existed business models, effectively select the appropriate operating model for their own development, and promote the development of e-retailing industry.This study seeks to use the supply chain structure theory and game theory to divide and further analyze different types of e-retailing models. Firstly, the concept of e-retailing model is defined, and the principal retail websites are divided into platform sites and self-built sites according to the founders. After introducing retail sites into the analysis of the e-retailing supply chain structure, based on different types of retail sites and their different positions in the supply chain structure, the e-retailing supply chain structures are classified into types and analyzed one by one. And then, depending on the supply chain leaders, e-retailing models are divided into three types: platform-led type, retailers-led type and manufacturers-led type. Several cases are used to illustrate these e-retailing models.Further analysis of these three models is based on game theory. After constructing and analyzing the model respectively, two variables, unit cost of settling in platform site and unit cost of maintaining self-built websites, are used for a comparative analysis of the three models. The equilibrium price and profit of these models are affected by unit cost of their own channel and unit cost of alternative channel simultaneously, but the impact of unit cost of their own channel is usually larger. These two unit costs have a direct impact on the equilibrium prices and profits, and if they meet the conditions of some certain values, the merits of models can be judged according to the profit functions. Finally, relevant conclusions are verified by certain data examples.The main innovation of this study is to take the retail sites as a member of e-retailing supply chain. Accordingly, e-retailing models are classified and analyzed. When game models are constructed, two variables, unit cost of settling in platform site and unit cost of maintaining self-built websites, are set for comparative analysis of each model. Based on the result of comparative analysis, suggestions are offered to manufacturers for e-retailing models selection.