M Bank's Supply Chain Finance Management

With the further development of China's supply side reform,it is imperative to expand the effective supply to improve total factor productivity.This has created favorable external conditions for the development of bank supply chain finance.From the bank,internal development to improve competitiveness is imminent.For the bank,obtain high quality assets is the first priority for corporate business.The supply chain finance will supply the chance for banks to focus on the core business,and the key industry.Core enterprises,key industries have a large number of credit retained,with no financing needs.Based on this,through the application of supply chain finance model,we can extending outward from the core enterprise,key industries,strong core enterprise's upstream supplier and downstream distributor.This is in line with the fundamental interests of the bank.For the core enterprise,this is a good opportunity for large and medium-sized enterprises to respond to the call of the"supply side reforms",while expanding their strength.And the way to activation idle credit from banks,as well as the preparation for core enterprise to build the financial industry platform.At the same time,the supply chain finance provide a convenient low-cost financing channels for the core business of the upstream suppliers and downstream distributors,consolidating the overall ecological supply chain.For banks,it is to obtain a higher intermediate business income,making the whole process more optimized.This paper make a deep study on the supply chain financing business,using research results from abroad and domestic,and the self liquidating trade and financing structure theory,value chain theory,value asymmetry theory as the basic theory.From the entire supply chain link analysis,this paper divides supply chain finance into three processes:the first is the procurement phase,in the process of purchasing raw material,upstream supplier agree to sell on credit for the purpose of core enterprises' order,cause the occupation of the upstream supplier's finds,and followed by the operational phase,the core business needs to prepare the warehouse in order to facilitate the storage of processed raw material,semi-finished and finished goods inventory,cause money is tight,the final is in the process of product sales,core enterprises which in a strong position often defer payment,this make downstream vendors'accounts receivable collection cycle longer,and will further overrun its money.In the procurement,production and sales link of supply chain,core business,upstream suppliers and downstream distributors have strong financing needs.In view of the above situation,based on the core enterprise of supply chain,using the core business good credit situation to enable banks give financing for its weak upstream suppliers and downstream distributors.For Banks,the core enterprise and its upstream and downstream is a win-win situation.In view of the three links of the supply chain,relying on the credit of core enterprises,this paper studies the account receivable in the purchase phase,the inventory pledge model in the operational phase,accounts payable in the sales stage and respectively give three companies which M bank support supply chain finance as the object of case study,introducing the details of the financing business for upstream suppliers,core enterprise as well as the downstream distributors,and carries the analysis and summary for each case,and make the conclusion that following by the direction of supply chain logistics,cash flow,information flow,supply chain finance business may greatly results to maximum win-win situation of the core enterprise,upstream suppliers or downstream distributors.Finally,this paper put forward the relevant suggestions,including paying attention to the cross use of varieties of supply chain financing instruments,providing variety of solutions to the enterprise,at the same time we also should control the key risk point,maximizing the balance of risks and benefits.