A growing need for financing in small and medium enterprises (SMEs) has become a significant obstacle to the development of firms. To remove this barrier, the purpose of this paper is to examine how supply chain finance (SCF) assists the firms to improve their performance by utilizing the resource-based view (RBV). Furthermore, the present study also pursues to test the effect of trade digitization as a moderating variable in the relationship between SC finance and the firm performance.
Using data from the textile sector, the authors run confirmatory factor analysis in AMOS 24 and hierarchical linear regression model in SPSS 23 to measure the proposed model and hypotheses, respectively.
The study suggests that SCF significantly improves the SMEs performance. Moreover, trade digitization strengthens the relationship between SCF and SMEs performance. Thus, the current study significantly describes the firm RBV through SCF and trade digitization to predict the SMEs performance.
SMEs entrepreneurs or executives can optimize the working capital through SCF and enhance the visibility of transactions through digitization for improving SMEs performance. Moreover, SCF protects the SMEs due to its nature of risk mitigation strategy.
This study covered the unexplored gap in the previous literature of supply chain management by establishing the relationship between SCF and the firm performance empirically while identifying the role of trade digitization as moderating variable in the context of textile SMEs by employing RBV theory.
Conflict of interest declaration: this research has no any conflict of interest. This research was supported by the Natural Science Foundation of China (Nos. 71731010 and 71571174).
Ali, Z., Gongbing, B. and Mehreen, A. (2018), "Does supply chain finance improve SMEs performance? The moderating role of trade digitization", Business Process Management Journal, Vol. 26 No. 1, pp. 150-167. https://doi.org/10.1108/BPMJ-05-2018-0133Download as .RIS
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