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The development of e‐commerce has greatly facilitated the practice that suppliers encroach upon the retail realm of downstream retailers through direct channels (e.g., online stores). The literature in this area has investigated profit‐maximizing firms, but the role of other organizational structures is not well understood. This study studies supplier encroachment in which the retailer is a dual‐purpose corporation that pursues his own profit as well as consumer surplus. We find that the retailer's pursuit of consumer surplus can not only intensify market competition and thus reducing the margin of direct selling, but also motivate the encroaching supplier to set a higher wholesale price compared with the case of no encroachment. The presence of a dual‐purpose retailer reduces the effectiveness of using the wholesale price as a lever by the supplier. Therefore, encroaching upon a dual‐purpose retailer can hurt the supplier. We examine whether a retailer can benefit from being a dual‐purpose corporation and how the retailer's dual objectives affect consumer surplus. Interestingly, a dual‐purpose retailer can earn a higher profit than a for‐profit retailer as the dual‐purpose structure helps deter encroachment (i.e., doing well by doing good). Also, consumer surplus in the case of a dual‐purpose retailer can be lower than that with a for‐profit retailer. This is because the commitment to be a dual‐purpose retailer reduces supplier encroachment and thus reduces the total quantity sold to consumers.

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This paper considers a one‐service operator, one‐handset manufacturer mobile phone supply chain (MPSC), and examines how the nature and level of both the handset manufacturer's fairness concerns and the operator's fairness concerns affect the decision of pricing, subsidizing, and channel choice between an unlocked channel and a bundled channel. Our analysis shows that in most circumstances, the MPSC will choose the bundled channel as long as the price elasticity is higher; however, this property is invalid under certain conditions. Our analysis further shows that the introduction of fairness may have significant effects on channel choice decisions. First, the manufacturer's fairness may hinder the MPSC from choosing the bundled channel when the channel power between the operator and the manufacturer is sufficiently asymmetric. Second, when the manufacturer is almost neck‐and‐neck with the operator, the manufacturer's fairness concerns may be conducive to the deployment of the bundled channel. Third, the bundled channel would never be a reasonable choice for both the operator and the MPSC when the manufacturer has a relatively powerful status, in particular under the situation when the manufacturer has strong fairness concerns. Fourth, the operator's fairness concerns are always detrimental to the bundled cooperation which is different from the effect of the manufacturer's fairness concerns, and the bundled channel would never be a reasonable choice for the MPSC when the operator is extremely powerful.

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The e‐commerce platform has been adopting the agency mode to sell the products of the national brand manufacturer (NBM) while introducing its own store brand and obtaining the consumer's preference information (CPI) to reinforce the competitiveness of the store‐brand products. This paper investigates the platform's decisions on whether to share the CPI with the NBM and its impact on the production timing decisions of the platform and the NBM. The results show that the platform may benefit from CPI sharing which may also change the equilibrium production timing of the platform and the NBM from sequential decision to simultaneous decision. In addition, the equilibria of the joint decision between the CPI sharing and the production timing are obtained, which is related to the market acceptance uncertainties of the products and the competitiveness of the national brands.