Strategic financing and sustainability decisions in dual-channel supply chains under demand uncertainty: a distribution-free game-theoretic perspective

Abstract

This study investigates how financing structure and sustainability investment jointly influence pricing, service, and green decision-making in a dual-channel supply chain under demand uncertainty. It particularly examines how bank financing and trade credit shape firms' ability to improve environmental performance, strengthen channel competitiveness, and enhance customer value. A Stackelberg game-theoretic model is developed involving a manufacturer and a retailer who operate through both online and offline channels. The manufacturer invests in green innovation financed through bank borrowing, while the retailer chooses between bank financing with a wholesale price discount or trade credit with deferred payment. Demand is uncertain and influenced by green investment and retail service. A distribution-free approach is employed to derive robust equilibrium strategies without assuming a specific demand distribution. Results show that financing choices critically shape sustainability-oriented decisions and channel coordination. Trade credit encourages higher green investment and retail service when financing costs are high, whereas bank financing is more effective under lower borrowing rates and stronger discount incentives. Demand uncertainty substantially affects inventory and profitability, particularly under high-variance settings. The distribution-free framework enhances decision robustness under uncertain market environments. This study develops an integrated dual-channel supply chain framework combining green innovation, retail service, dual financing, and distribution-free demand modeling within a single analytical structure. It contributes to marketing intelligence by illustrating how financial structures and uncertainty jointly drive sustainable strategy formation and channel coordination. The findings provide actionable insights for managers seeking to align green innovation, retail service, and financing decisions to build competitive and sustainable supply chains.