Trade Credit and Buyer Financing

Zhou, Weihua; Hu, Yulin; Lin, Tiantian; Ding, Zhuang

doi:10.1007/s11518-022-5530-z

Cited by 2 publications

(3 citation statements)

References 21 publications

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“…In formula (10), the frst item is the gross proft from selling low-carbon products to the retailer minus the carbon tax paid to the government, and the second item is the cost of investing in green technology. In formula (11), the frst item is the proft from selling low-carbon products to consumers, and the second item is the interest earned by depositing the remaining funds in the bank after paying the manufacturers' production cost and CER investment.…”

Section: Internal Financing (The If Mode)mentioning

confidence: 99%

“…Within the supply chain, in March 2022, Guangdong Midea landed the frst green supply chain fnance business in the home appliance industry, helping their suppliers achieve lower-cost fnancing. When manufacturers face fnancial constraints, they can secure loans from the bank [7], trade credit from the retailer [8,9], or they can apply for advances from a well-funded retailer [10]. In the context of "carbon peaking" and "carbon neutrality," we can expect that low-carbon fnance will be applied to more and broader areas for the beneft of society in the future.…”

Section: Introductionmentioning

confidence: 99%

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Manufacturer’s Green Financing and CER Decisions under the Carbon Tax Policy and Capital Constraints

Zhang,

Song,

et al. 2023

Complexity

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This study constructs a two-echelon low-carbon supply chain consisting of a single manufacturer and a retailer. The manufacturer’s initial capital is zero. The study analyzes three financing modes of the manufacturer by using the Stackelberg game model: external financing (the EF mode), internal financing (the IF mode), and trade credit financing (the TC mode). We found that the IF mode is superior to the EF mode while inferior to the TC mode regarding carbon emission reduction (CER), market demand, and the manufacturer’s profit. Additionally, the IF mode is superior to the EF mode regarding the retailer and supply chain’s profits and special to the TC mode only when the loan and deposit interest rate meet the specific conditions. The best financing mode for the manufacturer is the TC mode, but he needs to give some compensation to the retailer in order to make the retailer cooperate with him. The impact of carbon tax rate changes on the equilibrium solutions in the three financing modes is not only related to the change range of the carbon tax rate itself but also closely related to the initial carbon emissions. A high carbon tax rate can help stimulate the cleaner manufacturer to reduce carbon emissions, but a moderate carbon tax rate is more applicable to the polluting manufacturer. A numerical example is given to demonstrate some of the conclusions. Finally, the study provides managerial insights based on the analytical results.

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Section: Internal Financing (The If Mode)mentioning

confidence: 99%

Section: Introductionmentioning

confidence: 99%

Manufacturer’s Green Financing and CER Decisions under the Carbon Tax Policy and Capital Constraints

Zhang,

Song,

et al. 2023

Complexity

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show abstract

“…They considered a supplierpurchaser channel model and used a non-cooperative Stackelberg game theory to obtain their results. Zhou et al (2022) investigated TC and early payment involving a manufacturer, a distributor who is constrained by capital and a retailer platform in which either the manufacturer or the retail platform finances the distributor. Thus they considered a model in which either the platform or the manufacturer is the Stackelberg leader.…”

Section: Introductionmentioning

confidence: 99%

Modelling a manufacturer-retailers trade credit supply chain using game theory

Ezimadu¹,

Ezimadu²

2023

wojast

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Game-theoretic trade credit models are quite scarce, especially in relation to product promotion. This work examined a trade credit supply chain involving a manufacturer and two retailers in a decentralised supply chain in which the retailers engage in product promotion while the manufacturer financed them through credit provision. It considered a supply chain structure in which the manufacturer provides trade credit to the retailers and a situation in which he does not provide trade credit. It used Stackelberg game theory to determine the optimal promotion efforts, the credit periods and the players’ payoffs, and showed that while the manufacturer is better-off with the retailers’ efforts, the retailers need to consciously determine appropriate optimal effort to avoid getting short-changed. It also showed that while credit period reduces with the manufacturer’s margin, it increases with a retailer’s margin. It further showed that while the retailers’ payoffs reduce continuously with credit period, the manufacturer’s payoff is fixed in the long-run irrespective of the credit period provided by the manufacturer to the retailers. By comparison the players as well as the channel perform better with the adoption of trade credit, however a retailer must avoid placing he price margin at equality with that of the manufacturer if he hopes to enjoy long credit period.

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Trade Credit and Buyer Financing

Cited by 2 publications

References 21 publications

Manufacturer’s Green Financing and CER Decisions under the Carbon Tax Policy and Capital Constraints

Manufacturer’s Green Financing and CER Decisions under the Carbon Tax Policy and Capital Constraints

Modelling a manufacturer-retailers trade credit supply chain using game theory

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