Supplier Credit Risk-based Decision-making Model

Nowadays, the competition becomes more and more intense in the market. In order to attract more retailers or customers and ensure efficient resources allocation, suppliers often allow retailers deferred payment. Similarly, In order to attract customers, retailers also can give customers delay in payment. In one hand, credit payment is good for buyers capital turnover and can optimize the allocation of resources; In another hand, it can help sellers cover up price discrimination act effectively, better understanding of buyers credit conditions and accelerating inventory turns.At last, it plays a very important role in economic development and energy saving in the society. But credit payments bring certain amount of bad debt and default risk while increasing sales amounts for sellers at the same time, it will make suppliers suffer big risks even economic significant loss, if retailers or customers don't pay within the prescribed time limit. The research on risk before general were focused on the Banks, and other financial institutions, with the wide application of credit to pay, supplier credit risk attract more and more enterprise attention.Under the environment of supply chain, it is very important to study optimal inventory strategy based on credit risk. It can help enterprise to make better decisions after seriously balancing risks and benefits On the basis of previous studies under the environment of supply chain, this paper further study the optimal inventory strategy considering credit risk. The main research contents and conclusion summarized as follows:1) Summarizing the study literature of credit payment at home and abroad from retailers, suppliers, supply chain three angles, finding the existing problems in the present research and pointing out the future feasible research direction.2) Expounding credit risks related theory, through building the relevant model to find the biggest credit risk point and period, during this time, the enterprise must be prepared in advance to increase their risk awareness.3) Putting forward the partly credit payment strategies, to lower enterprise credit risk by lowering credit amounts, finding the optimal order strategy by building business model from retailers' angle.4) Building models considering the loss of bad, a series of collecting fees risk factors for suppliers, to formulate the optimal strategy and work out the optimal credit period.