Optimizing the credit term decisions in supply chain finance

Li, Haitao; Mai, Liuqing; Zhang, Wenlong; Tian, Xiangyu

doi:10.1016/j.pursup.2018.07.006

Cited by 38 publications

(32 citation statements)

References 35 publications

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“…Antonella et al (2019) applied stakeholder theory to the SCF domain to find the method that help SEMs reduce supply management risk and promote credit rating. Li et al (2018), based on game theory, proposed a model that addressed supplier-buyer interaction, prescribing the dynamic credit term over multiple periods, which is suitable for the SCF risk reduction. Judith and Erik (2019) explained the influence of supplier's commitment on time of financing and source of funds from a perspective of social exchange theory.…”

Section: Literature Reviewmentioning

confidence: 99%

How can SMEs acquire supply chain financing: the capabilities and information perspective

Liu

Hua

2020

IMDS

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PurposeThis paper aims to explore how innovation capability and market response capability of small and medium-size enterprises (SMEs) affect their supply chain financing performance (SCFP) through supply chain financing solutions (SCFS) adoption. At the same time, the mechanism by which supply chain financing reduces information asymmetry before (ex-ante) and after (ex-post) SCFS adoption to promote SCFP is also inquired.Design/methodology/approachDrawing on enterprise competence theory, this paper proposes a theoretical model and tests it using survey data from a sample of 218 SMEs in China. Multiple regression analysis is employed to test the hypothesis.FindingsThe study finds that: (1) SMEs' innovation capability and market response capability positively affect SCFP. (2) SMEs' innovation capability and market response capability exert significantly positive effects on SCFS adoption. (3) SCFS adoption plays a mediating role between SME capabilities and SCFP. (4) Supply chain integration (SCI) and information technology application have no moderating effects on the relationship between SME capabilities and SCFS adoption. Finally, (5) SCI and information technology application have positive moderating effects on the relationship between SCFS adoption and SCFP.Originality/valueBased on enterprise competence theory, this study sheds light on the internal mechanism through which SMEs' capabilities affect SCFP by introducing SCFS adoption and explores the role of situational factors in SCF in reducing ex-ante and ex-post information asymmetry. This study provides an innovative theoretical perspective on supply chain financing and enriches the existing research.

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Section: Literature Reviewmentioning

confidence: 99%

How can SMEs acquire supply chain financing: the capabilities and information perspective

Liu

Hua

2020

IMDS

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“…They did not consider budget constraints in their study. Li et al (2019) optimized dynamic credit term decisions, along with inventory production decisions in a two-level supply chain. They ignored financial constraints in their study as well.…”

Section: Operations-finance Interfacementioning

confidence: 99%

A joint inventory–finance model for coordinating a capital-constrained supply chain with financing limitations

2021

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Faced with economic recession, firms struggle to find ways to stay competitive and maintain market share. Effective coordination of the supply chain can solve this problem, but this may fail if existing capital constraints and financial flows are ignored. This study addresses the challenge by exploiting coordination through joint decision-making on the physical and financial flows of a capital-constrained supply chain. We also consider the capital-constrained member’s financing limitations that lead to lost sales. Two scenarios based on non-coordinated and coordinated structures are modeled in the form of bi-objective optimization problems that simultaneously optimize system costs and service levels. The models are solved using the $$\varepsilon$$ ε -constraint method. The results indicate that the non-coordinated model cannot satisfy more than about 50% of the demand due to capital shortage and financing limitations, while the coordinated model can satisfy all of the demand via internal financing. Furthermore, the proposed coordination scheme leads to cost reduction for the members and the total system. To motivate all members to accept the proposed coordination scheme, a cost-sharing mechanism is applied to the coordination procedure. Finally, a sensitivity analysis concerning financial parameters is provided for validating the coordination model.

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“…The farmers were asked about the financial resources used -credit card, consumption credit card and mortgage (see Table 1)-. The credit card is considered as a suitable indicator of «income existence»; for example, Li et al (2019) found an inverse relation of credit card availability to credit default, a relationship that cannot occur in absence of income so credit card availability is an indicator of stable personal income level. The survey was designed to measure different types of variables.…”

Section: Sample Description and Instrumentmentioning

confidence: 99%

«By the pricking of their thumbs»: farmers’ income dynamics towards sustainable development in rural Ethiopia

Grande¹,

Estébanez²,

Montero³

et al. 2021

RIED

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International cooperation priorities and Sustainable Development Goals agree on the linkage between agriculture and economics in developing countries' progress towards sustainability. In rural Ethiopia, agriculture is the major source of income and livelihood. In this study, it is aimed to analyse the association between farmers' experience, education, gender, cultivation of crop diversity, access to various financial resources and income levels among different villages. The methodology adopted is action research, performed during various research stays in rural Ethiopia, and using both qualitative and quantitative surveys. The quantitative results were analysed through multivariate statistical analysis. Interesting results emerge; for example, farmers from rural villages that have been using wells previously donated by the non-profit organization (NPO) show various positive impacts. They attend continuous training in agriculture, nutrition, and economics; they have more crop diversification, and they use varied financial resources. All these factors, as well as sociodemographic variables, link farmers' income levels to villages' improvement and empowerment, creating significant challenges for institutional design of alternative policies to maximize farmers' livelihood, sustainability and socioeconomic development in Third World countries. The article adds to the very small body of research, particularly of quantitative analysis, on factors associated with farmers' income in Africa based on primary data.

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Optimizing the credit term decisions in supply chain finance

Cited by 38 publications

References 35 publications

How can SMEs acquire supply chain financing: the capabilities and information perspective

How can SMEs acquire supply chain financing: the capabilities and information perspective

A joint inventory–finance model for coordinating a capital-constrained supply chain with financing limitations

«By the pricking of their thumbs»: farmers’ income dynamics towards sustainable development in rural Ethiopia

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