Abstract: In the era of IoT, the E-commerce mode not only saves the channel cost of manufacturers, but allows them acquire demand data from information sharing platform. In this way manufacturers adjust prices efficiently and affect the customers' purchasing strategies. However, to encourage customers change their traditional offline purchasing preferences, the online prices given by the manufacturers are usually lower than that of offline retailers which leads to an online-offline channel conflict. IKEA and Apple are the first companies trying to discover another types of E-commerce mode in which customers order online and pick up offline. Such a channel complementary business mode integrates online and offline channel and brings manufacturers more precise market demand prediction. Meanwhile, the offline dispatching service allows customers pick up the products more conveniently which promotes the satisfaction of customers.
A two-echelon closed-loop dual channel supply chain consisting of single online direct selling platform provider and single offline channel service provider is studied in the present paper. The platform provider in the forward channel takes charge of product manufacturing, remanufacturing, online direct selling, order receiving and passing the orders to offline channel service provider who takes charge of product distribution, instruction, maintenance, experience and return. The offline service provider in the reverse channel takes charge of recycling used product. They retrieve used product from customers in a certain price and are compensated by online platform provider. In the forward channel, online platform provider and offline channel service provider share their revenue of selling in the forward channel. In this scenario the optimal direct selling price, transfer payment, recycling price, the safety stock level of offline service provider and the service devotion in both online and offline channel are discussed. In the following extensive model, platform provider affords part of offline channel service cost at the same time. The optimal price and service devotion between revenue-sharing model and revenue-sharing-cost-sharing model are further compared.
By comparing revenue-sharing model and revenue-sharing-cost-sharing model, it is found that the optimal online direct selling price and offline forward channel service level are affected by revenue sharing ratio and cost sharing ratio while the optimal recycling price and optimal reverse channel service level are only affected by cost sharing ratio. Therefore, in the direct selling complementary closed-loop supply chain system, compared to the business mode that platform provider only shares online selling revenue to channel service provider, revenue-sharing-cost-sharing mechanism balances the service levels in both forward channel and reverse channel and affects the optimal offline recycling pricing strategy. Furthermore, by numerical study it is found that if online platform provider shares part of offline channel service construction devotion, the reverse recycling and reverse channel service level of service provider will increase. From analysis it is revealed that the Internet platform's property of openness, cooperation and sharing promotes the application of dual ratio mechanism design in closed-loop supply chain.
In conclusion, present paper aims to solve the problem that platform provider's online selling mode is not perfect and the hardness of recycling without physical stores. A complementary contract coordination mechanism is designed in which online platform takes charge of direct selling and offline service provider takes charge of dispatching. By comparison of two mechanism, it is found that revenue-sharing-cost-sharing mode is better than the mode without cost-sharing. However, in the practice, the success of such business mode relies on the cooperation among the members in the supply chain. In general, in the beginning, online platform provider and offline channel service provider only share their revenue in the forward channel. With the cooperation time and the trustiness among them increases, they form a strategic alliance in which online platform provider shares part of offline channel service provider's cost devotion to increase the service level of offline service provider. The compensation of online platform provider to offline service provider benefits both of them and allows them to develop the direct selling closed-loop supply chain together.

Key words: complementary closed-loop supply chain, revenue sharing, cost sharing, channel effort lev