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In order to meet the needs of different customer, manufacturer opened online direct channel based on retail channel. In the case of co-existence of dual-channel distribution, a model is built to analyze pricing competitions between one manufacturer and one retailer under the manufacturer providing business reputation to the retailer in a dual-channel supply chain. By designing business reputation, we make retailer participate in the competition more actively in dual-channel supply chain, improved the system order quantity. Furthermore the equilibrium pricing strategies were given by the Stackelberg game theory. The final illustrated the validity of the model by a numerical example.

Models of Pricing and Coordination in Dual-channel Supply Chain with Business Reputation