Impact of Capital Position and Financing Strategies on Encroachment in Supply Chain Dynamics
Qiuying Zhu,
Ce Wang,
Bin Zhang
Abstract:Channel encroachment and financing decisions are prevalent in practice. Utilizing the Stackelberg game framework, we investigate the impact of a retailer’s capital position and financing strategies on supply chain dynamics in which a supplier considers establishing a direct sales channel. We find that the retailer’s equilibrium financing strategy is impacted by demand volatility and the initial working capital. The supplier’s encroachment decision hinges on the entry cost when neither trade credit financing no… Show more
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