Operation strategy optimisation of a green supply chain under product promotion and competition

With the rapid rise in consumer green awareness, product greenness has become a critical factor in market competition. This study examines the green efforts of two competing manufacturers and a retailer in a two-echelon supply chain using a Stackelberg game model. In this model, manufacturers compete on product greenness and sell their products to one retailer. Two distinct low-carbon strategies are explored: (ⅰ) a single low-carbon strategy, where only manufacturers operate green investment; and (ⅱ) a joint low-carbon strategy, where the retailer also takes green effort by low-carbon promotion. The result shows that (ⅰ) competition on product greenness enhances demand from green-sensitive consumers; (ⅱ) operating low-carbon promotion allows all supply chain parties to achieve higher profitability; (ⅲ) the retailer may reduce its promotion effort if manufacturers already undertake significant green investment, so incentive mechanism may become necessary; (ⅳ) the joint low-carbon strategy brings higher profits for all supply chain parties, highlighting the value of coordinated green efforts.