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Article
Publication date: 20 July 2021

Qiang Lu, Yang Deng, Miao Yu, Hua Song and Beini Liu

This paper examines how weak ties and strong ties in the supply chain network influence the financing performance of small and medium enterprises (SMEs) through the…

Abstract

Purpose

This paper examines how weak ties and strong ties in the supply chain network influence the financing performance of small and medium enterprises (SMEs) through the mediation of information sharing and innovation capability.

Design/methodology/approach

Questionnaires were administered to 208 financial managers responsible for supply chain finance in SMEs in China. Data analysis techniques used included multiple regression analysis and fuzzy-set qualitative comparative analysis.

Findings

The authors found that weak ties had a more substantial impact on the financing performance of SMEs than strong ties did. Information sharing and innovation capability played a mediating role between weak and strong ties and the financing performance of SMEs. In addition, information sharing and innovation capability complement each other and jointly influence the financing performance of SMEs.

Practical implications

SMEs are suggested to actively embed themselves in the supply chain network to increase financing opportunities and reduce financing costs. The authors also recommend SMEs to enhance the level of their information sharing in the supply chain network and take advantage of their network ties to access and adopt new technology from other organisations and conduct collaborative innovation with partner institutions.

Originality/value

The paper extends the authors’ understanding of supply chain finance by exploring the intrinsic mechanism of how various constructs (weak ties, strong ties, information sharing and innovation capability) in the supply chain network have an impact on the financing performance of SMEs. In particular, the authors explore the under-researched mediating effect of information sharing and innovation capability on the relationship between network ties and the financing performance of SMEs.

Article
Publication date: 21 February 2020

Qiang Lu, Beini Liu and Hua Song

This paper aims to explore how innovation capability and market response capability of small and medium-size enterprises (SMEs) affect their supply chain financing

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Abstract

Purpose

This paper aims to explore how innovation capability and market response capability of small and medium-size enterprises (SMEs) affect their supply chain financing performance (SCFP) through supply chain financing solutions (SCFS) adoption. At the same time, the mechanism by which supply chain financing reduces information asymmetry before (ex-ante) and after (ex-post) SCFS adoption to promote SCFP is also inquired.

Design/methodology/approach

Drawing on enterprise competence theory, this paper proposes a theoretical model and tests it using survey data from a sample of 218 SMEs in China. Multiple regression analysis is employed to test the hypothesis.

Findings

The study finds that: (1) SMEs' innovation capability and market response capability positively affect SCFP. (2) SMEs' innovation capability and market response capability exert significantly positive effects on SCFS adoption. (3) SCFS adoption plays a mediating role between SME capabilities and SCFP. (4) Supply chain integration (SCI) and information technology application have no moderating effects on the relationship between SME capabilities and SCFS adoption. Finally, (5) SCI and information technology application have positive moderating effects on the relationship between SCFS adoption and SCFP.

Originality/value

Based on enterprise competence theory, this study sheds light on the internal mechanism through which SMEs' capabilities affect SCFP by introducing SCFS adoption and explores the role of situational factors in SCF in reducing ex-ante and ex-post information asymmetry. This study provides an innovative theoretical perspective on supply chain financing and enriches the existing research.

Details

Industrial Management & Data Systems, vol. 120 no. 4
Type: Research Article
ISSN: 0263-5577

Keywords

Article
Publication date: 15 November 2022

Qiang Lu, Yang Deng, Beini Liu and Jinliang Chen

As an effective mode to help small and medium enterprises (SMEs) raise working capital, supply chain finance has recently gained extensive attention. The purpose of this…

Abstract

Purpose

As an effective mode to help small and medium enterprises (SMEs) raise working capital, supply chain finance has recently gained extensive attention. The purpose of this paper is to explore the intrinsic mechanism of how both weak and strong ties in the supply chain network impact the supply chain financing performance (SCFP) of SMEs from the perspective of the supply chain network.

Design/methodology/approach

Based on the extended resource-based perspective, this paper proposes a theoretical model to explain the mode in which strong ties and weak ties of SMEs in the supply chain network influence SCFP through both physical distribution flexibility and demand management flexibility. Based on data from 182 manufacturing firms in China, this paper uses multiple regression analysis to test hypotheses.

Findings

The results of this paper indicate that weak ties improve SCFP more effectively than strong ties. Furthermore, both physical distribution flexibility and demand management flexibility exert different mediating roles either between strong ties and SCFP or between weak ties and SCFP. Moreover, the effect of physical distribution flexibility and demand management flexibility on SCFP of SMEs is not reinforced.

Originality/value

This paper highlights the importance to expand supply chain finance research from the perspective of the supply chain network. In particular, this paper explores the poorly understood mediating effect both physical distribution flexibility and demand management flexibility exert on the relationship between network ties and the SCFP of SMEs.

Details

Journal of Business & Industrial Marketing, vol. ahead-of-print no. ahead-of-print
Type: Research Article
ISSN: 0885-8624

Keywords

Article
Publication date: 8 May 2019

Lucia Gibilaro and Gianluca Mattarocci

The aim of the study is to provide evidence on the distress in the supply chain and its impact on the trade credit policy, firms’ performance and risk and their growth…

Abstract

Purpose

The aim of the study is to provide evidence on the distress in the supply chain and its impact on the trade credit policy, firms’ performance and risk and their growth opportunities. Trade credit creates a strict relation between suppliers and customers that cannot be easily substituted over time. The linkages established between firms in a supply chain are a key value added for all members that could represent a competitive advantage over independent market players. In the event of a supply chain disruption, all members could suffer from a decrease in profitability and an increase in risk. Nonetheless, no empirical evidence exists on the expected economic and financial effects on pertinent suppliers and customers.

Design/methodology/approach

This paper examines the US market and evaluates the impact of a supply chain member’s default on the other members, looking at both the customers’ and suppliers’ default. The sample considers all firms in the USA disclosing entry into bankruptcy proceedings through EDGAR filings that were not classified as financial intermediaries between 2012 and 2016. The analysis considers the effect of distress on the supply chain (suppliers or customers) on the trade credit policy, performance, risk and growth perspectives of connected firms.

Findings

The results show that a supply chain disruption not only modifies the trade credit policy but also affects firm risk and profitability and the financing sources available to support firm growth. Empirical evidence shows that the bankruptcy of a member of the supply chain affects the trade credit policy of all the other members. The costs related to default are economically and financially relevant to all supply chain members and affect the resiliency of the supply chain beyond the short term.

Originality/value

This paper uses an original and innovative database to empirically test the impact of corporate distress on supply chain financing, performance, risk and growth opportunities.

Details

Supply Chain Management: An International Journal, vol. 24 no. 4
Type: Research Article
ISSN: 1359-8546

Keywords

Article
Publication date: 16 February 2022

Yaqin Yuan and Wei Li

This study aims to investigate the impact of supply chain risk (SCR) information processing capabilities (e.g. SCR information sharing and SCR information analysis) and…

Abstract

Purpose

This study aims to investigate the impact of supply chain risk (SCR) information processing capabilities (e.g. SCR information sharing and SCR information analysis) and supply chain finance (SCF) on supply chain resilience, as well as the moderating effect of environmental uncertainty in the relationship between SCF and supply chain resilience.

Design/methodology/approach

This paper proposes a theoretical model grounded on the information processing theory. Data collected from 216 Chinese firms are used to test the theoretical model by employing structural equation modelling.

Findings

The findings reveal that SCR information processing capabilities have a significant impact on both SCF and supply chain resilience. SCF plays a partial mediating role in the relationship between SCR information processing capabilities and supply chain resilience. In addition, environmental uncertainty moderates the relationship between SCF and supply chain resilience.

Originality/value

First, this paper enriches the knowledge of how information processing capability affects SCF and supply chain resilience as the study considers the more granular SCR information rather than general information that has been discussed in previous studies. Second, this is one of the first papers to establish the relationship between SCF and supply chain resilience in emerging economies. Next, the paper extends the theoretical framework of the antecedents and consequences of SCF. Moreover, the study further facilitates the understanding of the role of the external environment in SCR and SCF management.

Details

Journal of Enterprise Information Management, vol. 35 no. 6
Type: Research Article
ISSN: 1741-0398

Keywords

Article
Publication date: 26 November 2021

Yaqin Yuan, Linlin Liu and Liu Liu

This paper aims to investigate the relationship between information integration, supply chain capabilities and credit quality of small and middle enterprises (SMEs) in…

Abstract

Purpose

This paper aims to investigate the relationship between information integration, supply chain capabilities and credit quality of small and middle enterprises (SMEs) in supply chain finance (SCF).

Design/methodology/approach

Grounded in the resource-based view (RBV) and signaling theory, this study proposes a theoretical model. Then, structural equation modeling and interview analysis are employed to test the theoretical model.

Findings

The results show that both two aspects of information integration, namely, information technology and information sharing, have positive effects on the SMEs’ credit quality in SCF, and these effects are mediated by supply chain capabilities.

Originality/value

First, the paper contributes to SCF literature by simultaneously examining the role of two dimensions of information integration (information technology and information sharing) in enhancing SMEs’ credit quality. Second, this paper enriches the existing theoretical research on SCF by integrating the SMEs perspective and SCF service provider perspective. Moreover, this paper explores the indirect effects of information integration on SMEs’ credit quality by incorporating supply chain capabilities as a mediating factor.

Details

Industrial Management & Data Systems, vol. 122 no. 2
Type: Research Article
ISSN: 0263-5577

Keywords

Article
Publication date: 20 October 2022

Qiang Lu, Yudong Yang and Miao Yu

The purpose of this study is to examine how the quality management of small and medium-sized enterprises (SMEs) impacts their supply chain financing performance (SCFP)…

Abstract

Purpose

The purpose of this study is to examine how the quality management of small and medium-sized enterprises (SMEs) impacts their supply chain financing performance (SCFP). This study also investigates the mediating roles of organisational dependence between quality management and the SCFP of SMEs, as well as the moderating role of environmental dynamics.

Design/methodology/approach

Questionnaires were administered to 248 financial managers responsible for supply chain finance (SCF) in SMEs in China. Data analysis techniques used include necessary condition analysis and multiple regression analysis.

Findings

Research findings show that, in SCF, the quality management of SMEs positively predicts their SCFP through the mediation of the organisational dependence of the focal enterprises in the supply chain network. Environmental dynamics are also found to moderate the relationship between quality management and SCFP through the organisational dependence of capital providers.

Originality/value

To the best of our knowledge, this is the first study to explore the relationships between SMEs' quality management and their SCFP. Also, this study provides a new theoretical lens through which to study SCF by introducing signalling theory.

Details

International Journal of Emerging Markets, vol. ahead-of-print no. ahead-of-print
Type: Research Article
ISSN: 1746-8809

Keywords

Article
Publication date: 3 December 2019

Omogbai Oleghe

This study aims to describe in detail, a system dynamics-based study that was used to show how a large vertically integrated aquaculture company should approach its…

481

Abstract

Purpose

This study aims to describe in detail, a system dynamics-based study that was used to show how a large vertically integrated aquaculture company should approach its stepwise capacity expansion program, without undermining its financial performance or affecting the performance of the value chain.

Design/methodology/approach

The company and its aquaculture value chain are used as case study. A system dynamics model is developed on the basis of generic end-to-end agribusiness and aquaculture supply chain models. The model includes the unique dynamics relating to an aquaculture supply chain. Also modelled is the working capital management rules of the company, with the effects of the capacity expansion program on its working capital, market share and its supply chain obligations. The model is used to determine the long-term impact of the company’s working capital management under different modes of financing and rate of expanding the capacity.

Findings

For a large vertically integrated company that wants to increase its capacity, there is a systematic approach to working capital management that can be used to avoid financial distress or value chain distortion.

Research limitations/implications

Extended the scope of system dynamics modelling within multiple disciplines, namely, agribusiness supply chain finance, supply chain capacity investment, financial management in large companies, supply chain working capital management and aquaculture value chain.

Practical implications

The developed model can be used to manage supply chain working capital in large vertically integrated agribusinesses, and also to assess supply chain financial risk.

Originality/value

To enhance the model build, discrete event simulation was used to model aspects of the system. The eventual system dynamics-discrete event simulation model is a form of hybrid simulation modelling that was used to provide a deeper understanding of how supply chain financial decisions affect an entire value chain system.

Details

Journal of Modelling in Management, vol. 15 no. 2
Type: Research Article
ISSN: 1746-5664

Keywords

Article
Publication date: 5 October 2022

Hua Song, Siqi Han, Wenyi Liu and Anirban Ganguly

The purpose of this paper is to explore the role of FinTech companies in SCF. The application of digital technology in supply chain activities has facilitated the…

Abstract

Purpose

The purpose of this paper is to explore the role of FinTech companies in SCF. The application of digital technology in supply chain activities has facilitated the evolution of supply chain finance (SCF) to a new level. However, how financial technology (FinTech) companies promote this evolution has not been thoroughly examined.

Design/methodology/approach

This research used the multiple-case study approach and social network analysis method to explore how FinTech companies influence SCF networks.

Findings

The results reveal that FinTech companies play the crucial role of a signaling intermediary by facilitating interactions among relevant parties, accelerating the flow of information and reducing information asymmetry arising from data smog. Moreover, FinTech companies make SCF information networks more equitable and promote the performance of SCF.

Originality/value

This study deepens the conversation at the nexus of signal theory and SCF and provides managerial implications for alleviating information asymmetry between borrowers and lenders to solve the difficulty and high-cost problems of obtaining financing of small- and medium-sized enterprises.

Details

Journal of Business & Industrial Marketing, vol. ahead-of-print no. ahead-of-print
Type: Research Article
ISSN: 0885-8624

Keywords

Article
Publication date: 15 November 2018

Zulqurnain Ali, Bi Gongbing and Aqsa Mehreen

Due to globalization, textile small and medium enterprises (SMEs) operations have become complex which raised the needs of risk-free financing solutions to support the…

1938

Abstract

Purpose

Due to globalization, textile small and medium enterprises (SMEs) operations have become complex which raised the needs of risk-free financing solutions to support the SMEs’ daily processes. The purpose of this paper is to investigate the effect of supply chain (SC) finance, a risk-free financing solution, on SC effectiveness (SCE) in the context of textile SMEs by employing transaction cost (TC) approach.

Design/methodology/approach

The participants of the study were recruited from textile SMEs through a structured questionnaire. The proposed model and structural relationships were assessed by employing AMOS 24.0.

Findings

The results of this paper indicate that supply chain finance (SCF) has a significant effect on SCE. Furthermore, all proposed factors of SCF adoption have a positive and significant effect on SCF.

Practical implications

This study helps the SMEs executives or owners to adopt SCF as a secure financing scheme to reduce the credit TCs, optimize the firm working capital, reduce the risk of default, and improve SC effectiveness. SMEs and suppliers can build strong relationships while adopting the findings of this study. SMEs can engage the suppliers to work under strategic alliance through negotiation, collaboration, and work digitization, and extend their payment terms while providing an opportunity to the suppliers to get their payment back before a fixed time through discounting from financial institutions as needed.

Originality/value

The present study covered the gap related to SCF and SCE by identifying unique factors of SCF adoption which was ignored in the previous literature by employing TC approach.

Details

The International Journal of Logistics Management, vol. 30 no. 2
Type: Research Article
ISSN: 0957-4093

Keywords

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