Abstract In a single-period two-stage supply chain, the supplier and relailer keep equal market power by hiding supplier’s production cost information and the retailer’s sales effort without a coordination main body . To deal with it, a virtual third party, as a selfless principal, is introduced to represent the whole interests of the supply chain, design the coordination mechanism basing on revenue sharing and effort cost partaking contract, and implement double incentives. The results show that if the revenue sharing proportion and cost sharing ratio meet some conditions within a certain range, the supply chain coordination could be realized, and the “win-win” for partners would be obtained. Finally, a numerical experiment is made to validate the results.
2012, Vol. 1 
