Research On Internal Equity Financing Decision-making And Model Selection From The Perspective Of Supply Chain

While creating value for the development of the national economy,small and medium-sized enterprises are also faced with the dilemma of expensive and difficult financing during their operation.Equity financing is an important way to help small and medium-sized enterprises solve financing difficulties.According to different financing channels,it can be divided into public market offering and private offering.For most small and medium-sized enterprises in the early stage of growth,it is difficult to reach the threshold of listing,so private equity has become the main way for small and medium-sized enterprises to carry out equity financing.In equity financing,for independent third-party investors,due to information asymmetry and industry investment barriers,it is difficult for investors to correctly judge the value of the enterprise,resulting in financing failure.In contrast,the core enterprises in the supply chain not only have strong financial strength,but also have close business relations with upstream and downstream small and medium-sized enterprises.Therefore,core enterprises in the supply chain are more likely to learn about the production and operation of small and medium-sized enterprises than independent third-party investment institutions,and core enterprises often discover the investment value of small and medium-sized enterprises on the chain earlier than third-party institutions.Therefore,based on the problem of financing difficulties for SMEs,this thesis proposes equity financing within the supply chain and explores new measures for SME financing.This thesis considers the core enterprises in the supply chain to provide internal equity financing in the supply chain for their upstream and downstream small and medium-sized enterprises with capital constraints,and analyzes the optimal decision-making and profits of both parties by constructing a Stackelberg game model with both supply-marketing and investment-financing relationships.First of all,the third chapter of this thesis builds a two-level supply chain system composed of small and medium-sized retailers with capital constraints and suppliers with abundant funds and strong strength,and discusses respectively no equity financing and retailers have the right to expand the market control(R1 model).The optimal decision-making behavior and profit of each member of the supply chain in the case of internal equity financing with extended market control(S1 mode)with suppliers.The study found that:(i)The profit of retailers does not necessarily increase after the introduction of equity financing.If the retailer’s growth rate is low,the blind introduction of internal equity financing will cause the loss of its own profits;(ii)The supplier provides equity financing for retailers with limited funds.It will increase its own profits,so suppliers are always motivated to provide financial support to retailers through equity financing;(iii)When the growth of retailers is high,the upstream and downstream enterprises in the supply chain will use the R1 model of equity financing to achieve cooperate.Further,the fourth chapter of this thesis considers another situation of the supply chain,that is,the supplier is a small and medium-sized enterprise,and the retailer is the core enterprise.When the retailer provides financial support for the supplier promotion market through the internal equity financing of the supply chain,the supplier promotion market competes with the retailer,and the retailer can benefit from the equity dividend and free-rider effect.Businesses are not only in the relationship between investment,financing and supply and marketing,but also have a competitive relationship,which has a complex impact on the operational decisions and performance of both parties.Therefore,the fourth chapter first uses the reverse induction method to solve the optimal decision of the supply and marketing parties without equity financing;The changes in the optimal decision-making of the two under the situation of undertaking marketing work,and compared with the non-equity financing,it is found that: after the supplier introduces equity financing,its profit does not necessarily increase.If the cost of promoting the market is high,blindly The introduction of internal equity financing will cause the loss of its own profits;and for the investor retailer,providing equity financing will increase its own profits.Moreover,the free-rider effect is an important factor affecting the choice of the supplier’s optimal financing strategy-if there is no free-rider effect,the supplier’s optimal choice is mode B;with the increase of the free-rider effect,the supplier gradually tends to choose S2 mode or R2 mode.The research results combine supply chain operation and equity financing,propose the problem of alleviating the financing difficulties of small and medium-sized enterprises by means of equity financing within the supply chain,discuss the ownership of control rights and channel competition in the financing process,and supplement the original literature on The insufficiency of the choice of corporate financing methods also provides theoretical guidance for the investment and financing activities in the supply chain.