Alleviating supplier’s capital restriction by two-order arrangement

Jiang, Li; Hao, Zhongyuan

doi:10.1016/j.orl.2014.07.009

Cited by 16 publications

(6 citation statements)

References 12 publications

Supporting

Mentioning

Contrasting

Order By: Relevance

“…There is a line of research studying how to finance a capital‐constrained supplier. Jiang and Hao (2014) propose that a retailer finances a capital‐constrained supplier through an advance payment. Tang et al.…”

Section: Related Literaturementioning

confidence: 99%

See 1 more Smart Citation

Capital structure and supply chain capacity investment

2022

Production and Operations Management

View full text Add to dashboard Cite

This paper studies whether risky borrowing will induce a supplier to expand capacity and thus mitigate a capacity underinvestment problem in supply chains. It demonstrates that the relationship between capacity and capital structure is not as simple as the existing literature suggests. If the supplier is very powerful, it will use a mixed capital structure and build less capacity than if it were equity financed. If the buyer is very powerful, the supplier will use all debt financing and overbuild capacity. In this case, the supplier would not agree to build capacity ex ante if it were prohibited from borrowing. Hence, borrowing is Pareto optimal. Under a more balanced power structure, the supplier may choose all debt financing and overbuild capacity or all equity financing and underbuild capacity, depending on the trade-off of the bargaining benefits and costs of debt financing.

show abstract

Section: Related Literaturementioning

confidence: 99%

“…There is a line of research studying how to finance a capital-constrained supplier. Jiang and Hao (2014) propose that a retailer finances a capital-constrained supplier through an advance payment. Tang et al (2018) compare bank financing and manufacturer financing of a financially constrained supplier with random yield.…”

mentioning

confidence: 99%

Capital structure and supply chain capacity investment

2022

Production and Operations Management

View full text Add to dashboard Cite

show abstract

“…Some studies have shown that trade credit as a way of coordination can effectively coordinate the supply chain with capital constraints (Lee and Rhee [14]; Xiao et al [25]). Jiang and Hao [10] studied how well-funded manufacturers can alleviate supplier's financial constraints by prepayment. Yan and Sun [31] discussed the retailer's financial constraints and bankruptcy risk, and made a comparison of two internal financing modes based on order and capital-gap.…”

Section: (Communicated By Ada Che)mentioning

confidence: 99%

Coordination contracts for a dual-channel supply chain under capital constraints

Zhang¹,

Wang²,

Liu³

et al. 2021

Journal of Industrial &Amp; Management Optimization

View full text Add to dashboard Cite

Manufacturers often face capital constraints when opening up online channel, at this time external financing and internal financing are usually considered. Previous literature has shown that internal financing, turns out to be a better option. To figure out how trade credit financing discount contract affects operations and performances of supply chain, this paper studies the pricing decision of a retailer-dominant dual-channel supply chain with manufacturer's capital constraints. The Stackelberg game models under centralized decision and decentralized decision are constructed. Moreover, this paper conducts research about the effects of revenue-sharing (RS) contract, direct channel price discount (DP) contract and retail channel price discount (RP) contract on the performance of supply chain. Numerical examples are provided to explore the comparison of the optimal pricing strategies and total profits under different contracts. The results show that the retailer prefers RS and DP contracts to RP contract. Among them, RS contract has a broader scope of coordination, while DP contract can achieve a higher profit. The results can serve as insights for decision-makers to choose the most appropriate financial discount contract.

show abstract

“…As a compensation to the bankruptcy risk, the supplier offers the distributor a discounted wholesale price, and we call it the pre-order price. Here we assume that the pre-order price is w 1+r d , where r d is the discount factor (Jiang and Hao [15]). So the pre-order quantity of the products is…”

Section: 2mentioning

confidence: 99%

Financing strategies for a capital-constrained supplier under yield uncertainty

Peng¹,

Pang²

2020

Journal of Industrial &Amp; Management Optimization

View full text Add to dashboard Cite

We consider a supply chain consisting of a supplier and a distributor, in which the supplier has a capital constraint and faces productivity yield uncertainty. To solve the capital constraint problem, we propose an advance payment with risk compensation (APRC) mechanism, under which the distributor finances the supplier with an advance payment, and the supplier provides a price discount to compensate the distributor for the supplier's bankruptcy risk. The optimal solutions are derived under the APRC mechanism and the results indicate that under the APRC, the whole supply chain performs as well as if there is no capital constraint, in terms of profits and optimal strategies. Therefore, the APRC is an efficient solution for the supplier's capital constraint issue. In addition, when the deficit is big, the APRC provides an alternative financing arrangement and it can bring higher profits for both parties. Another very interesting finding is that, when the capital deficit is small, the supplier can do better with the bank loan financing, despite that a higher interest rate needs to be paid in this case.2010 Mathematics Subject Classification. Primary: 90B50, 91A80; Secondary: 90B30, 91A35, 91B06.

show abstract

Alleviating supplier’s capital restriction by two-order arrangement

Cited by 16 publications

References 12 publications

Capital structure and supply chain capacity investment

Capital structure and supply chain capacity investment

Coordination contracts for a dual-channel supply chain under capital constraints

Financing strategies for a capital-constrained supplier under yield uncertainty

Contact Info

Product

Resources

About