The Supply Chain Financing Risk Simulation Research For Small And Medium Sized Enterprises Based On System Dynamics

In the past nearly30years, China economic makes rapid and healthy development,the small and medium sized Enterprises (SMEs),as the vital comment of China marketing economics, plays the important and positive role in promoting China economics and social harmony.However, The SMEs doesn’t deserve the corresponding policy support, especially in acquiring financing and bank loans. The reason why SMEs faces the financing dilemma is SMEs’s credit rating is lower than the standard of bank loads requirement. Because the bank considers the risk management and control as the first thing concentrated.Therefore, in the complicated context of the current slowdown in China’s economic development, not be optimistic about the world economy, to get SMEs survived, it must explore a new ways which is not only reduce financing risks but also could be well controlled the financing risks.Through the new way, the financing dilemma puzzling the SMEs could be solved wellFortunately, It is the Supply Chain Financing that provides such a solution for financing dilemma, which is highly popular in international financial.Supply Chain Financing is an integrated service, which based on analyzing the transaction structure of supply chain and could provide the closed credit, relative settlement service and financing product to the enterprises in the supply chain. Supply Chain Financing integrates Self-liquidating trade financing model with new risk control variables such as the core enterprise, Logistics supervision enterprise and capital flow guidance tools. Its essence is that the beneficial integration of resources in the entire supply chain. In order to achieve Pareto optimization.In actual practice, there are three most widely used supply chain financing modes:Receivables financing mode^Inventory financing mode and Prepayment financing mode. For one hand, the three financing modes can achieve the financing and risk control, for another hand the three financing modes is complicated system because of multi-stakeholder involvement, which leads to many financing risk factors. Therefore, it’s need to analyze the three financing modes to find these risk factors.System Dynamics, which was put forward by Dr. Forrester in Massachusetts Institute of Technology, concentrates on the researching how the factors of dynamics system affect each other and causal relationship by computer simulation.What’s more, the credit risk、market risk and operational risk supply chain financing faced are caused by the complicated, interacted risk factors. Therefore, System dynamics is reasonable to apply to study the three risks management and control in the supply chain financing, which are due to risks factors.Based on the system dynamics, with the help of system dynamics simulation software VENSIM PLE, it could be possible to established supply chain financing risk estimation models and run the simulation. The simulation results show that how the various risk factors affect the credit risk, market risk and operational risk on the financing process. According to the simulation results and actual practice, it is reasonable to recommend the supply chain financing risk management and control optimaion methods.