An analysis of trade credit models in supply chains
Date Issued
2016
Date
2016
Author(s)
Wu, Ting-Yu
Abstract
With highly impact of global economic, Taiwan’s economic structure becomes different with before, and the managerial solutions are unable to work because of the risk of global trade credit. Small and medium enterprises (SMEs) are usually face to financing problem, that’s also the reason that more and more research of supply chain finance in academic and practices. Thus, this research focuses on trade credit, and we’ll develop a supply chain contract for SMEs to help them in financing. The perspective of a supply chain trade credit model based on a news-vendor model is from a retailer, and it includes three dimensions. First, we build a cash-payment criterion, so retailers will decide to pay early or not. Second, we consider the information flow of demand request; at last, combined with return policy, retailers can make decision with overall situation to improve their operating performance. Running scenario analysis by several numerical examples, we changed the parameters of demand distribution to simulate the real situation, the result shows that return policy help retailers manage inventory effectively. After all, to exam the effect of trade credit contract, we change market sizes to see whether retailer’s profit will be impacted. Although supplier scarifies parts of her own profit, retailer will gain benefit from the supply chain contract by risk sharing.
Subjects
Trade credit
Supply chain finance
Supply chain contract
News-vendor model
Return policy
Type
thesis
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