# Manufacturer Channel Encroachment and Evolution in E-Platform Supply Chain: An Agent-Based Model
## 4 Simulation and Results
### Overall Analysis  
To have an overall assessment of the five scenarios, we compare manufacturers' and the platform's profit. Figure 17a shows the manufacturer's average cumulative revenue after 100 periods in the different scenarios, consisting of revenue from the retail channel and the direct sales channel. In terms of overall revenue, manufacturers gain the most under scenario E and the least under scenario B. Manufacturers receive the highest retail revenue when consumers have channel preferences (Scenario C). The highest direct sales revenue is achieved when commission rates are reduced. In a scenario where the platform reduces commissions, the manufacturer's profits are increased to the relative maximum. Under Scenario E, there is no significant change in the manufacturer's selling price, but  
Figure 16: (a) Sales quantity and in A and E; (b) consumer utility in A and E. (\(t=100\)).  
Figure 15: Prices in A and E of: (a) high-quality product in retail channel; (b) low-quality product in retail channel; (c) high-quality product in direct sales channel; (d) low-quality product in direct sales channel. (\(t=100\)).  
there is an increase in overall sales volume, so higher profits can be made. Manufacturers suffer a relatively maximum loss of profit in the face of consumers with a high degree of quality preference. Under scenario B, there is a significant reduction in product sales. The retail prices of high and low-quality products increase and decrease respectively. The prices in the direct sales channel do not change significantly, so the overall profit became less.  
The e-commerce platform receives the highest revenue when consumers have channel preferences, followed by the second highest revenue when consumers have quality preferences, and the lowest revenue when commission rates are reduced, as shown in Figure 17b. Faced with channel-preferring consumers, e-commerce platforms can exploit their channel advantage, gaining more demand and thus higher profits through commission extraction. As a major source of revenue, it is not difficult to understand that lower commissions on e-commerce platforms can directly lead to lower profits. On the indirect side, lower commissions also increase the trend of channel encroachment by manufacturers, increasing the intensity of channel competition and thus affecting profits.  
The results of the above analysis show that manufacturers are more likely to engage in channel encroachment when consumers are less sensitive to product quality and have no channel preference. Both lower commission rates and higher direct channel maintenance costs reduce manufacturers' tendency to encroach. Of the five scenarios, manufacturers under Scenario E are most likely to engage in channel encroachment. This is also the most profitable scenario for manufacturers and the least profitable for e-commerce platforms. The two scenarios with higher platform revenues are both scenarios with lower levels of manufacturer encroachment, and both scenarios face consumers with preferences. On the one hand, there is a preference for high-quality products, and on the other hand, there is a preference for retail channels on e-commerce platforms. Both preferences are in favour of the e-commerce platform. However, the profit situation for manufacturers in such a preference is not very positive compared to other scenarios.