Abstract Considering the supply chain consists of a single manufacturer and two retailers as the research object, this study constructs four game models which include centralized, decentralized, two-stage compensation, and joint bargaining. Through theoretical proofs and numerical simulations, this study compares and analyzes the decision-making results of channel members before and after the retailer’s collusion, and explores the influence of the manufacturer’s incentive and punishment mechanism on the retailer’s collusive decision. Research shows that collusion among retailers can achieve stronger market control, but collusion agreements will squeeze the profits of retailers with smaller market shares. The opening of online channels by manufacturers can restrain retailers from colluding, and the restraining effect is positively correlated with online market share. As consumers’service sensitivity increases, dual channels may not be beneficial to manufacturers, and retailers may still collude. To this end, this study introduces a punishment mechanism corresponding to the incentive contract to curb the retailer’s motives for collusion, and proposes a dominant incentive and punishment mechanism for retailers with different bargaining power.
