The optimal financing mode in a three-stage supply chain under capital constraint of retailers

In real life, there is a problem of capital fracture in some enterprises especially small and medium enterprises in the upstream and downstream of the supply chain. In order to research how retailers choose the optimal financing mode, this paper analyzes the double channel and three- stage supply chain under capital constraint of retailers, uses multi-objective nonlinear programming method, constructs the delayed payment financing model and the loan financing model respectively and gives the optimal decentralized decisions of suppliers, manufacturers and retailers under the two modes. The research shows that under the coexistence of the delayed payment financing model and the loan financing model, when the delayed payment rate is equal to the lending rate, if the retailers choose the delayed payment model, then it can not only increase the profits but also improve the market competitiveness and expand the market. This provides certain theory and numerical reference basis for retailers to choose a financing model

Comparing world regional sustainable supply chain finance using big data analytics:A bibliometric analysis

Purpose: Sustainable supply chain finance (SSCF) is a fascinated consideration for both academics and practitioners because the indicators are still underdeveloped in achieving SSCF. This study proposes a bibliometric data-driven analysis from the literature to illustrate a clear overall concept of SSCF that reveals hidden indicators for further improvement. Design/methodology/approach: A hybrid quantitative and qualitative approach combining data-driven analysis, fuzzy Delphi method (FDM), entropy weight method (EWM) and fuzzy decision-making trial and evaluation laboratory (FDEMATEL) is employed to address the uncertainty in the context. Findings: The results show that blockchain, cash flow shortage, reverse factoring, risk assessment and triple bottom line (TBL) play significant roles in SSCF. A comparison of the challenges and gaps among different geographic regions is provided in both advanced local perspective and a global state-of-the-art assessment. There are 35 countries/territories being categorized into five geographic regions. Of the five regions, two, Latin America and the Caribbean and Africa, show the needs for more improvement, exclusively in collaboration strategies and financial crisis. Exogenous impacts of wars, natural disasters and disease epidemics are implied as inevitable attributes for enhancing the sustainability. Originality/value: This study contributes to (1) boundary SSCF foundations by data driven, (2) identifying the critical SSCF indicators and providing the knowledge gaps and directions as references for further examination and (3) addressing the gaps and challenges in different geographic regions to provide advanced assessment from local viewpoint and to diagnose the comprehensive global state of the art of SSCF

Exploring the relationship between mechanisms, actors and instruments in Supply Chain Finance:A systematic literature review

Supply Chain Finance (SCF) deals with the management of financial flows along the supply chain. Its core objective is to facilitate the reduction of financial risk in a supply chain by improving the collaborative cash-to-cash cycle and working capital. In order to fulfil its objective, SCF involves the coordination of supply chain actors, SCF instruments, and supply chain processes. Existing studies focus either on SCF actors, such as buyers, suppliers, banks, and logistics service providers (LSPs), or on specific SCF instruments, such as reverse factoring, inventory financing and discounting. However, an analysis of the relationship between actors and instruments, as well as of the factors influencing this relationship, requires further development. In light of this gap, this paper systematically reviews the literature on SCF with the objective of clarifying the relationship between SCF actors, instruments, and contextual factors. The review identified three main archetypes for this relationship: fixed-asset financing (fixed asset-centric), inventory financing (inventory-centric), accounts receivable/accounts payable financing (buyer-centric and supplier-centric). Based on the results of the review, the authors discuss the implications for practitioners and further research for academics

Supply Chain Finance Adoption:Three is a Crowd in Entangled Relationships

Supply Chain Finance (SCF) has gained increasing attention in recent years – for both favourable reasons, e.g. the critical need for working capital during economic recovery, and adverse reasons, e.g. high-profile scandals and abuses of SCF reported in the media such as Greensill and Carillion. The SCF literature has primarily focused on the economic advantages of SCF, and a so-called win-win-win approach claiming that all the parties involved , e.g. the bank, buyer, and supplier, would all benefit from SCF arrangements. Even though previous research on the adoption of SCF has pointed to the reluctance of firms, especially suppliers, to adopt SCF, the literature has given most attention to large focal firms, placing less emphasis on their supply chain partners. Yet supplier reluctance is also important to these focal firms as the successful implementation of SCF is determined by the degree of participation and frequency of transactions with suppliers. This has produced a need to systemically understand how small, less powerful non-focal firms construct their understandings of SCF and make decisions about SCF participation. This thesis investigates the understandings of, and the decision to adopt, SCF primarily in SMEs, both upstream as suppliers and downstream as distributors, in two different settings ─ the UK, where SCF is relatively well developed, and Thailand where SCF recently started in 2016. Given the dissensus in the literature regarding the appropriate theoretical underpinnings, this study employs a grounded theory-based methodology in which no theory was committed to before data collection and analysis, allowing for a substantive theory of SCF relationships to emerge from the collected data. This involved 56 interviews with SMEs, banks and subject experts as well as analysis of supporting documents. Consistent with grounded theory, the study sought to identify the main concern of the research participants and the way in which they dealt with this identified main concern. Through a constant comparative analysis of interview data, supporting documents, and relevant literature, the emergent main concern or core category was identified as the ‘Dyadic - Triadic distinction’. This distinction was between dyadic forms of SCF, in which informants had relatively independent relationships in their physical and financial supply chains, and triadic forms, in which relationships were entangled in some way. Triadic forms appeared to be inherently problematic, leading to the thesis that ‘Three is a Crowd’. Participants dealt with this main concern through five interrelated categories of concern ─ Risk, Relationship, Awareness, Control, and Context. Following the emergence of the main concern or core category and the five interrelated categories, a systematic analysis was undertaken of how transaction cost economics (TCE), which was identified as the most appropriate formal theory, could and could not account for the findings. For example, many of the findings could be interpreted in terms of opportunism and information impactedness, but there were concerns with relationships and control that could not be explained by TCE. From this analysis a qualitative model of how SMEs understood and made decisions to adopt SCF was proposed. In addition, a more detailed model was developed to show the significance of signalling concerns in the findings. The main contribution of this thesis is to show how the firms often meant to be the primary beneficiaries of SCF – SMEs – are much less concerned with technical advantages (such as lower financing cost), and much more concerned with the relational consequences of participating in more complex triadic forms of SCF. The key practical implication that is drawn is that focal firms need to be aware, when offering triadic SCF to their smaller supply chain partners, that these partners often have existing dyadic SCF relationships. Therefore, their decision to adopt an offered triadic SCF is not straightforward, but involves participating in a new relationship and at the same time having to maintain or reduce existing ones ─ often including both financing and supply chain relationships

Exploring supply chain finance as an instrument for enabling logistics service providers to upgrade their service offerings

Due to high levels of competition (CMP) and diminishing returns in the traditional transportation and warehousing services, logistics service providers (LSPs) are differentiating themselves by providing value-added services (for competitive advantage) to supply chain members. By exploiting their visibility and control of physical and information flows (IFLs) in the supply chains, LSPs have tapped into the supply chain finance (SCF) market. SCF as a value-added service extends the scope of LSPs’ service offerings by integration and control of physical, information and financial flows (FFLs) across the supply chain. This facilitates the reduction of financial risk in supply chains by improving the collaborative cash-to-cash (C2C) cycle and working capital of the supply chain members. The two major research streams associated with SCF are financial supply chain management (FSCM) and trade credit. FSCM mainly focuses on the supplier-buyer relationships and the FFL while trade credit emphasises the short-term financing enabling the cash flow management that is fundamental to SCF. The existing studies in the literature provide insights into the SCF services, their mechanisms and ‘enablers and inhibitors’ for SCF adoption but a comprehensive understanding of the capabilities required by a particular supply chain member, such as an LSP, to offer SCF service offerings as a part of their service portfolio is still missing. In order to properly design and develop SCF service offerings, LSPs should be supported by a comprehensive theoretical knowledge pertaining to their capabilities. The provision of offering SCF services is associated with the new service offerings discussed in the strategic management literature, which emphasises the need for renewed skills, processes and routines developed within the frame of operations (operational capabilities) to offer new services. As the operational capabilities draw on the resources, the development of an adequate resources base by obtaining, reconfiguring, integrating and releasing of the resources (dynamic capabilities process) plays a crucial role in offering new services such as SCF. In this context, the strategic management literature provides an opportunity to carry xxviii out empirical research that identifies all the relevant characteristics, contextual factors and capabilities that might lead LSPs to offer SCF services. Keeping this in view and to explore this prospect, the purpose of this thesis is to identify LSPs’ capabilities and associated mechanisms necessary to offer SCF services. The research design that was developed to address this opportunity is a case-based approach with four embedded units of analysis. This provides the opportunity to look for literal replication of the guiding principles that underpin the capabilities an LSP can leverage to extend its service provision to SCF services. The research concludes that the interrelationships between the dynamic capabilities process and its antecedents, generic operational capabilities of LSPs and SCF adoption capabilities, provide a mechanism to understand the LSPs’ capabilities required to offer SCF services. Subsequently, the thesis contributes to theory and practice by developing a conceptual framework that can be used by researchers to extend the horizons of new service development such as SCF services and by practitioners to evaluate their firms’ (LSPs) capabilities to extend their service portfolio to offer SCF services