Decision Making Of Capital-constrained Supply Chain Based On Supplier Buy-back Financing Model

The low credit rating and financing difficulties have become a problem that restricts the development of Small and Medium-sized Enterprises(SMEs)in China.As a result,SMEs are unable to implement optimal ordering decisions,and the supply chain cannot achieve maximum profits.The emergence of supply chain finance has eased the financing dilemma of SMEs,using the credit of core enterprises to inject capital into the supply chain,and also transferred the financing risk to the core enterprises.As a supply chain financial model,financing with guarantee of supplier repurchase can control the guarantee risks of core enterprise and effectively solve the problem of supply chain risk sharing and efficiency improvement.In order to solve the financing dilemma of small and medium-sized retailers and improve the profits of the whole supply chain,based on supply chain finance theory,this paper applies the Stackelberg game theory to the two echelon supply chain consisting of single supplier and single retailer,and studies the impact of supplier repurchase financing mode on the decision of capital constrained supply chain.This paper firstly studies the supply chain decision-making,including the wholesale price of the supplier and the optimal order decision of the retailer,without using the supply chain financial means to finance,only taking the supplier buyback as the contractual relationship of the supply chain.And it is used as the model foundation of this paper.Secondly,financing with repurchase guarantee is introduced into the model,and the model of decision-making game under the two modes is constructed separately.From the traditional confirming warehouse financing,the improved design of the two repurchase guarantees is carried out,that is,the supplier promises to the bank to repurchase unsold merchandise at the end of the period,and to partially repurchase merchandise purchased with the loan but not sold.Then,in order to make the theory more practical,considering that retailers with good operation in reality have a certain probability to repay the loans by themselves,this paper introduces the bankruptcy probability to study the supply chain coordination under the repurchase guarantee of supplier.Through the numerical analysis,this paper compares the different decisions of supplier,retailer and bank under the two modes,and draws the following main conclusions: Supplier buyback can help supply chain financing,and the financing effect is affected by the proportion of supplier buyback and bank loan interest rate.Suppliers can adjust wholesale price to achieve their own goals;When choosing partners,suppliers should try to choose retailers with higher own funds.Suppliers can provide such retailers with a higher proportion of buyback to help retailers obtain bank loans with lower interest rate from banks,so as to improve the profits of the whole supply chain;In the retailer's capital constrained supply chain,the supplier should try his best to help the retailer obtain low loan interest rates of bank,which will bring greater benefits to the whole supply chain and realize the growth of both sides of the supply chain,especially when the retailer's bankruptcy probability is low.As a financing mode,supplier buyback guarantee can improve the performance of supply chain to some extent.The results of this study can provide some advice for decision making of supply chain enterprises and financial institutions to some extent,and provide guidance for suppliers in selecting downstream cooperative retailers...