Abstract:

Under the background of e-tailers and consumers’ support for poor farmers， e-tailers， such as JD. COM， are encouraged to help selling agriculture products of poor areas. Consumers are also willing to buy products in poor areas and pay a price premium for them. However， expensive logistics costs are regarded as main obstacles that hinder the e-selling of agriculture products in poor areas. Usually， there are two e-selling modes for agriculture products， which are agency selling and reselling modes. Under the agency selling mode， farmers sell directly to consumers and undertake logistics costs while the e-tailer charges a few commission. Under the reselling mode， the e-tailer purchases products from farmers and resell them to consumers， and the e-tailer undertakes logistics costs. Due to economics of scale， the e-tailer’s logistics efficiency is usually higher than farmers’. In this context， the sale strategy of agriculture products in poor areas has become a challenge for farmers， e-tailers and government. That is to say， is it beneficial for poor farmers to sell by e-channel？ Which sale mode is better for poor farmers？To solve the questions， a two level supply chain composed of an e-tailer and a poor farmer is studied， and a Stackelberg game model between them is established. Firstly， the farmer’s production decisions and the e-tailer’s pricing decisions are studied under agency selling and reselling modes， considering the e-tailer and consumers’ preference to support farmer and logistics costs. Further， the farmer selling in the local market is taken as a contrast， and the effects of e-selling on farmer’s welfare are analyzed by comparing the farmer’s profits with selling in the local market and with selling under two e-selling modes.The results show that e-tailers and consumers’ preference to support farmer both have positive effects on farmer’s production and profit. Compared to selling in the local market， e-tailing can improve farmer’s profit in most cases. While the farmer’s profit may be hurt when logistics costs are relatively high and the e-tailer’s preference to support farmer is relatively small， or when logistics costs are very high. Combined with numerical analysis， it is gotten that agency selling mode usually performs better in improving farmer’s profit than reselling mode； when farmer’s logistics cost is obviously higher than the e-tailer’s （e.g. 10% higher than the e-tailer’s）， agency selling mode does better only if the e-tailer’s preference to support farmer is relatively high （e.g. higher than 0.5）； when farmer’s logistics cost is significantly higher than the e-tailer’s （e.g. 40% higher than the e-tailer’s）， reselling mode does better.The research findings can provide decision reference and management enlightenment for the selling of agriculture products in poor areas. To develop e-tailing in poor areas， firstly， the government may stimulate e-tailers and consumers’ willing to support poor farmers by means of rewards or subsidies. Secondly， the government may improve cold-chain logistics infrastructure in poor areas or subsidize logistics costs to reduce logistics costs of agriculture products’ e-tailing.

Key words: e-tailer’s support for farmers, agriculture products supply chain, preference to support farmers, agency selling mode, reselling mode