Product Market Competition,Customer Concentration And Trade Credit

When the financial crisis causes banks to tighten credit,the difficulty of satisfying financing needs through bank loans has increased significantly.Trade credit emerged as a new financing method that runs through the entire supply chain.Customers not only play an important role in the supply chain,but also act as important stakeholders.It plays an important part in the production and sales of the product market.In recent years,customer concentration has shown an upward trend.However,higher customer concentration will deepen the opportunism risk of enterprises and reduce the bargaining power of enterprises.In order to realize the value of specific assets,enterprises will maintain customer relationships by providing trade credit.It is necessary to study customer concentration and trade credit from the perspective of product market competition.On the basis of reading relevant literature,the research background,research significance,and innovation points were first described.Secondly,domestic and foreign scholars reviewed the status quo of trade credit and customer concentration,and discussed the relationship between customer concentration and trade credit.It was based on credit rationing theory,the theory of resource dependence,competitive hypothesis theory,negotiating power theory,contract theory and relationship specific investment theory and other related theories.Whether centralized customer relationship brings the credit rationing advantage and implicit contract pressures,or from the strong willingness to grasp important resources,or from insufficient bargaining power and the need to ensure the value of specific investment,companies will tend to meet the requirements of important customers to offer more trade credit.The industry concentration and the market position of the company will affect this relationship.The hypothesis was put forward.The A-stock manufacturing companies from 2012 to 2016 were used as a sample to conduct empirical regression analysis.The conclusions were listed.Firstly,customer concentration and the supply of trade credits is positively correlated.Secondly,the higher the industry concentration,the less significant the positive correlation between them.Thirdly,the higher the market position of the company in the industry,the weaker the positive correlation between customer concentration and the supply of trade credits.The existing studies about customer concentration and trade credit focus on the perspective of the recipient of trade credit,and the research related to market competitiveness focuses on the industry level.From the supply side of customer relationships,external factors such as product market competition are introduced.For the first time,the internal and external perspectives of product market competition are taken into account at the same time.The relationship between customer concentration and trade credit provided by enterprises is explained through non-single logic and empirical.The analysis not only enriches the literature related to trade credit,but also helps the company to strengthen customer relationship management and launch effective competition,which has theoretical and practical significance.