Store Brand Sourcing Strategy for a Platform Incorporating Corporate Social Responsibility

School of Economics and Management, Beihang University, Beijing 100191, China

^* Corresponding author: lishuangbing@buaa.edu.cn

Abstract

E-commerce platforms are increasingly launching store brands while integrating corporate social responsibility (CSR) into their operations. In this paper, the model compares scenarios including no store brands, in-house production, sourcing from incumbent national brand manufacturers, and sourcing from external third-party manufacturers to examine platforms’ optimal production strategies of store brands and the effects on national brands. Research demonstrates that while e-commerce platforms’ store brand introduction reduces national brand retail prices, it simultaneously expands market demand—an effect most pronounced under in-house production. Moreover, any store brand strategy invariably erodes incumbent manufacturers’ profits, with the most severe impact occurring when platforms choose in-house production. Meanwhile, production strategies depend critically on CSR level, consumer acceptance, and fixed costs. When platform CSR level is high, store brand introduction becomes inevitable, and platforms select inhouse production if its fixed costs are sufficiently low, otherwise opting for third-party sourcing.