Abstract:

In recent years， the realm of electronic commerce in China has experienced rapid growth， leveraging the transformative force of platform economics. However， concomitantly， the implementation of complementary regulatory measures has lagged behind. Consequently， issues such as the coexistence of reputable and unscrupulous third-party sellers and the proliferation of counterfeit and substandard products have arisen. An increasing number of retail platforms have embarked on expanding their self-operated channels， characterized by stringent quality control and superior services， to mitigate the prevailing difficulties in product quality management. Nevertheless， this intensifies the competition between self-operated channels and third-party sellers， potentially compelling some third-party sellers to consider shifting their sales channels. It aims to delve into the preference of retail platforms with self-operated channels concerning third-party sellers when contemplating product quality， as well as the sales channel decisions made by these third-party sellers. It endeavors to explore the following questions： What is the strategic equilibrium game involving the transition between self-operated channels and third-party sellers？ And does the establishment of self-operated channels on the platform lead to the expulsion of sellers peddling inferior products？It focuses on a retail platform that has both self-operated channels and incorporates third-party sellers. By constructing a three-stage game model， it investigates the commission decisions of the retail platform in light of product quality and the sales channel choices of third-party sellers. Firstly， the equilibrium profits of third-party sellers are compared given a specific platform commission， thereby identifying the conditions under which third-party sellers opt to switch sales channels. Secondly， assuming the choice made by third-party sellers， the commission pricing decisions of the retail platform are analyzed， by comparing the platform's profits under different commission strategies， and the optimal decision for the platform is determined to expel sellers. Lastly， the impact of the platform's decision to expel third-party sellers， as well as product quality and switching costs， on sales volume and profits for all parties involved is explored.The research findings indicate the following　Firstly， when the cost of self-operation is below a certain threshold， the retail platform will establish self-operated channels. Furthermore， the platform's commission increases as the quality of sellers' products improves， and when the commission exceeds the switching cost， sellers will transition to alternative sales channels. Secondly， the retail platform is only inclined to retain both sellers or solely expel sellers peddling low-quality products； it does not favor expelling all sellers and solely relying on self-operated channels to sell products to consumers. Thirdly， for sellers with low product quality and high switching costs， even if the retail platform prefers to retain them， their sales volume on the platform will be zero.

Key words: retail platform, self-operated channel, product quality, third-party seller