Supply chain collaboration and supply chain finance adoption: the moderating role of information transparency and transaction dependence

Abstract

Purpose Although supply chain collaboration (SCC) theoretically boosts the adoption of supply chain finance (SCF) through information sharing and cost savings, many companies with good supply chain partnerships still hesitate to engage in SCF. To disentangle this puzzle, this study aims to explore how two dimensions of information transparency (i.e. information quantity and information quality) and two types of transaction dependence (i.e. dependence on suppliers and dependence on customers) influence the relationship between SCC and SCF adoption. Design/methodology/approach This study uses secondary survey data from a Chinese bank, including 464 Chinese companies that have adopted SCF to varying degrees. This study then performs the logistic regression analysis to test the hypotheses. Findings This study empirically confirms that SCC shows a positive relationship with SCF adoption. More interestingly, information quantity negatively moderates this positive relationship, whereas information quality positively moderates this positive relationship. Most surprisingly, dependence on customers rather than dependence on suppliers strengthens this positive relationship. Originality/value This study makes theoretical contributions to the SCF literature by demonstrating the distinct moderating mechanisms regarding the relationship between SCC and SCF adoption. The findings also help companies reexamine their interactions with supply chain members.

Determinants of supply chain finance adoption among SMEs: evidence from a developing economy

“…Thirdly, from a theoretical standpoint, findings from the new conceptual model provide relevant and reliable proof for SCF adoption, as depicted by the achievement factors of SCF as a means of improving the SC of SMEs. Fourthly, this paper responds to the calls for empirical studies on SCF (Yuan et al, 2022;Li et al, 2023). Further, most contributions in this field are conceptual, often lacking empirical evidence (Caniato et al, 2019).…”

“…In this regard, SCF solutions has become a relatively innovative practice that is increasingly being adopted by SMEs across the globe to solve their financing problems (Lekkakos and Serrano, 2016; de Goeij et al , 2021). Although SCF is at its critical stage of development, little is known about the factors that underpin its adoption (Bi et al , 2021; Li et al , 2023). Extant literature has focused mainly on the instruments of SCF such as inventory financing (De Boer et al , 2015; Song et al , 2016; Martin and Hofmann, 2017; Xu et al , 2018; Lam et al , 2019; Chakuu et al , 2020), dynamic discounting (Basu and Nair, 2012; De Boer et al , 2015; Caniato et al , 2016) and reverse factoring (Dello Iacono et al , 2015; Caniato et al , 2016; Liebl et al , 2016; Bals, 2019; de Goeij et al , 2021).…”

“…To promote SCF adoption, some SC-related factors play an important role because, in the SC, SCF practices are associated with activities that are transactional (Wang et al , 2020). According to Li et al (2023), the understanding of how SC-related factors influence SCF adoption is quite critical and urgent among SMEs.…”

“…Diverse theoretical frameworks have been used in the SCF literature resulting in little consensus on relevant theoretical frameworks (Phraknoi et al , 2022). Resource dependency theory, information processing theory, network theory, agency theory, resource-based theory and transaction costs economics (TCE) have all been adopted in multiple papers (Li et al , 2023). As theorizing remains at a nascent stage, this paper draws on the theoretical pillars of SCM and finance to conceptualize the adoption and implementation of SCF as influenced by two dominant theories: the TCE and resource-based view (RBV) (Barney, 1991; Huo et al , 2016; Ali et al , 2019; de Goeij et al , 2021).…”

“…Literature review 2.1 The concept of supply chain finance and adoption factors At the intersection of finance and supply chain management (SCM), SCF has been developed as an emerging topic and is a relatively recent approach to financing SC activities among SC partners (de Goeij et al, 2021). It is a type of management behaviour that integrates commercial operations, financial management and logistics operations with the aim to unite external financial providers and various members in the SC, promptly respond to the capital needs of firms in the SC and ultimately achieve common value creation (Lam and Zhan, 2021;Chen et al, 2021;Li et al, 2023).…”