Refurbishment of Recovered Products and Pricing Strategies Under Environmental Awareness in a Dual-Channel Closed-Loop Supply Chain with Product Exchange Offer

The study investigates a dual-channel closed-loop supply chain with a product exchange offer, considering environmental awareness efforts. The manufacturer produces new and refurbished products using recycled used products. The forward channel considers price-sensitive competitive linear demands, and the reverse channel considers a sensitive collection rate, which includes buy-back prices and environmental awareness initiatives. The goal is to determine optimal environmental and economic decisions under centralized, manufacturer-Stackelberg, retailer-Stackelberg, and Nash game scenarios. A wholesale price-sharing contract is also introduced to explore channel coordination. The study’s findings provide practical insights into the optimal decisions and their implications for channel coordination. The study’s findings demonstrate that higher buy-back prices and increased environmental awareness levels have a positive impact on product recovery, benefiting the entire supply chain. The retailer-Stackelberg model emerges as the one with the highest demand for refurbished products, while the retailer achieves the highest individual profit in the wholesale price sharing contract model. The study also uncovers that the recovery rate of products from the retailer’s end remains consistent across all decentralized models. Furthermore, the study suggests that managing the cost associated with environmental awareness provision is crucial for maintaining optimal supply chain network efficiency.