we show that the purchasing price offered by the firm has a unimodal pattern in its cost-sharing proportion. Second, under the FCF structure, we consider two bargaining models based on the cooperative’s commission contracts with the farmer. We find that the farmer’s production effort can achieve the system optimal level, and the cooperative’s high bargaining power helps ensure a steady FCF contract farming agreement. We also find that there exists a win–win–win outcome for all three channel members when the cooperative’s commission ratio is higher than a threshold level.