Research On Accounts Receivable Factoring Strategies In Supply Chain Finance

This paper takes the operation process of accounts receivable factoring as the research object.It established expected profit models of the upstream and downstream enterprises in supply chain and the factor by introducing the default risk of the downstream firm based on random fluctuating market demand using the basic framework of game theory.Under the circumstances of single transaction,multiple transactions and batch delivery,this paper analyzed the best strategies and expected profit of the upstream and downstream enterprises in supply chain as well as the factor,and conducted numerical simulation of the model.The results show as follows.Firstly,when the own funds of the upstream enterprise are relatively deficient and default risk of the downstream enterprise is relatively low,adopting factoring can raise the profit of upstream as well as down-stream enterprises in the supply chain,reducing the wholesale price and increasing the order quantity.Secondly,under the circumstance of multiple trades,repeated game could reduce the default risk in a single game and that the successful trades increases with discount rate decreasing;Under the circumstance of batch delivery,the change of total delivery times has different extent of influence on upstream enterprises,the downstream enterprises and the factor at a high level and a low level.Furthermore,the increase of delivery times may raise the optimal order quantity,but has no impact on the optimal wholesale price.The main creative points of this paper are to introduce the downstream enterprises of supply chain risk of default into the mathematical model,to establish the mathematical model under constraint by studying on the decision-making and the change of the profit under therestriction of the own funds of the upstream enterprise and the risk of default risk.In addition,there is little literature employing repeated game theory to study on the factoring process,and this paper established repeated game model based on two scenarios of multiple transactions and batch delivery,making the results accords better with the practice of enterprise management.