A Supply Chain Theory of Factoring and Reverse Factoring

Kouvelis, Panos; Xu, Fasheng

doi:10.2139/ssrn.3241484

Cited by 18 publications

(19 citation statements)

References 13 publications

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“…Significant scholarly attention has been devoted towards quantifying these benefits of RF adoption (see e.g., Van der Vliet et al (2015); Kouvelis and Xu (2019); Wu et al (2019)).…”

Section: Review Of the Related Rf Literaturementioning

confidence: 99%

An empirical analysis of suppliers' trade-off behaviour in adopting digital supply chain financing solutions

Banerjee

Lücker

Ries

2021

IJOPM

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PurposeReverse factoring (RF)–a form of supply chain finance (SCF)–is widely recognised as a win-win for both buyers and suppliers. Still, there is evidence that suppliers are often hesitant to join RF programmes initiated by their buyers. This study advances our understanding of how suppliers assess the importance of various attributes of a buyer's offer to join RF and discusses the role of programme configuration and digital technology in overcoming impediments to RF adoption.Design/methodology/approachUsing a choice-based conjoint experimental design validated by experts, we isolate and manipulate the main attributes of a RF programme offer. This enables us to estimate the attributes' importance and to examine suppliers' trade-off behaviour. The authors complement the experimental study with content analysis of respondents' comments.FindingsThis study reveals the importance of behavioural considerations in RF adoption. The main findings are (1) suppliers are willing to reject offers that they perceive to be unfair even if these offers benefit them financially, (2) suppliers are willing to trade-off their financial benefit for non-financial reasons–most notably attributes that relate to trustworthiness of the buyer–and (3) suppliers expect technologies to increase transparency and reduce variability in trade processes.Research limitations/implicationsNon-financial attributes that influence supplier perception need to be considered in the programme configuration. Technologies that reduce information asymmetry, increase trust and transparency, increase the speed of execution and reduce process inefficiencies will have a positive impact on RF offer acceptance.Originality/valueThis research opens new lines of inquiry on the role of digital technologies in influencing behavioural operations management specifically suppliers' adoption of digital SCF solutions.

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“…Significant scholarly attention has been devoted towards quantifying these benefits of RF adoption (see e.g., Van der Vliet et al (2015); Kouvelis and Xu (2019); Wu et al (2019)).…”

Section: Review Of the Related Rf Literaturementioning

confidence: 99%

An empirical analysis of suppliers' trade-off behaviour in adopting digital supply chain financing solutions

Banerjee

Lücker

Ries

2021

IJOPM

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“…ey find that manual discounting is always more attractive to the firm than automatic discounting if the factoring discount rates of the two are the same. Kouvelis and Xu [27] develop a supply chain theory of traditional factoring (recourse and nonrecourse) and reverse factoring, showing when these postshipment financing schemes should be adopted and who really benefits from the adoption. e extant literatures on traditional factoring examine either only its receivables management function, such as Sopranzetti [8], or only its financing function, such as Huang and Zhang [25] and Kouvelis and Xu [27].…”

Section: Related Literaturementioning

confidence: 99%

Why and How Does a Supplier Choose Factoring Finance?

Chun-ying

Chen

et al. 2020

Mathematical Problems in Engineering

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Suppliers offering trade credit to the downstream retailers have to face many problems, such as receivables management, capital occupancy, and buyer’s credit risk. Many of them choose factoring finance to solve those problems simultaneously. This paper develops several supply chain decision models to show the benefits a supplier can obtain from the main functions of factoring and how he should choose between recourse factoring and nonrecourse factoring. In particular, we identify the conditions on which factoring may bring benefits (including financial benefit, guarantee benefit, and receivables management benefit) to the supplier. The supplier’s choice between recourse and nonrecourse factoring relies on his risk attitude. Given that the supplier is risk-neutral and the factoring fees are acceptable, recourse factoring is preferred when the factoring finance ratio is relatively high; otherwise, nonrecourse factoring is preferred. However, if the supplier is risk-averse, his preference for the two factoring schemes under different finance ratios may change when the risk constraints become stricter. If the target profit is lower than a certain level, the supplier’s financial choice will switch from recourse factoring to nonrecourse factoring in the case finance ratio is relatively low; otherwise, his financial choice switches from nonrecourse factoring to recourse factoring in the case finance ratio is relatively high.

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“…Anjak Piutang merupakan salah satu jenis perusahaan pembiayaan yang menawarkan pembiayaan melalui pembelian piutang perusahaan. Secara umum Anjak Piutang dapat diartikan sebagai pengaturan keuangan (financial arrangement) dimana perusahaan (supplier/klien) menjual piutang kepada Perusahaan Pembiayaan (factor) berdasarkan premi (keuntungan), dan menerima uang tunai untuk kebutuhan modal segera (Kouvelis & Xu, 2018).…”

Section: A Pendahuluanunclassified

Penguatan Regulasi Dan Perjanjian: Upaya Optimalisasi Anjak Piutang Sebagai Alternatif Pembiayaan Perusahaan

Abubakar

Handayani

2020

Masalah Masalah Hukum

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Salah satu alternatif pembiayaan yang dapat digunakan oleh perusahaan dengan menggunakan asetnya sendiri adalah Anjak Piutang. Namun, pengaturan yang tidak tegas mengakibatkan praktik Anjak Piutang lebih mengarah pada pinjaman dengan jaminan daripada pembelian piutang. Hal ini dapat dilihat dari jenis Factoring with Recourse yang membebankan risiko piutang yang tidak tertagih kepada Klien (penjual piutang). Oleh karena itu, diperlukan penguatan regulasi dan perjanjian Anjak Piutang untuk mengoptimalkan Anjak Piutang sebagai alternatif pembiayaan perusahaan melalui pembelian piutang. Penguatan regulasi dapat dilakukan dengan memberikan pedoman dalam perjanjian Anjak Piutang untuk mencantumkan klausul buyback (pembelian kembali piutang) oleh perusahaan (klien) dalam Factoring with Recourse. Pengawasan terhadap penggunaan perjanjian baku menjadi salah satu upaya untuk memastikan perjanjian memenuhi esensi Anjak Piutang.

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A Supply Chain Theory of Factoring and Reverse Factoring

Cited by 18 publications

References 13 publications

An empirical analysis of suppliers' trade-off behaviour in adopting digital supply chain financing solutions

An empirical analysis of suppliers' trade-off behaviour in adopting digital supply chain financing solutions

Why and How Does a Supplier Choose Factoring Finance?

Penguatan Regulasi Dan Perjanjian: Upaya Optimalisasi Anjak Piutang Sebagai Alternatif Pembiayaan Perusahaan

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