Study On Financing Strategies Of Auto Parts Manufactures Considering Stochastic Demand

Automobile manufacturing industry is an important industry in China.Small and mediumsized enterprises in the industry have strategic significance in solving employment problems,promoting production technology progress and even promoting social and economic development.But in reality,SMEs are facing severe shortage of funds: they often have no voice,and the accounts receivable period is long,which leads to the accounts receivable can not be timely converted into cash flow into enterprise accounts,and due to the low level of credit,they encounter the problems of "difficult financing" and "expensive financing".The capital problem not only affects the operation and survival of SMEs themselves.Economic production is closely linked.Once supply interruption occurs in upstream enterprises,it will seriously affect the operation of enterprises and restrict the development of the whole supply chain.Therefore,how to use accounts receivable to finance small and medium-sized enterprises with capital constraints,break through the bottleneck of capital turnover in the supply chain,is essential for promoting sustainable development of enterprises and supply chain and maintaining the stability of industry.Based on the existing research,this paper mainly discusses two financing modes of accounts receivable: reverse factoring and dynamic discount.Reverse factoring uses a credit substitution mechanism to make the manufacturer obtain loans by using the credit rating of the core enterprise brand.Dynamic discount enables core enterprises to flexibly arrange the payment time according to their own financial situation and obtain price discount by paying in advance.Both reverse factoring and dynamic discount can alleviate the bankruptcy crisis of manufacturers.The difference is that reverse factoring uses the credit rating of core enterprises to obtain financing from external financial institutions,while dynamic discount directly transfers funds to manufacturers from within the supply chain.This paper studies the supply chain of a single manufacturer and a single brand facing stochastic demand.With the time value of capital and the manufacturer’s operating status introduced,capital constrained model,the reverse factoring model,linear dynamic discount model and nonlinear dynamic discount model are built to analyze supply chain decisions and revenue.The numerical example verifies the effectiveness of the model,illustrating the influence of market demand fluctuation,manufacturer’s own capital status,price and cost,accounting period and riskfree interest rate on decisions and revenue.The results show that the impact of price and cost on the decision-making of supply chain is always opposite.The accounting period and risk-free interest rate have an indirect impact on the decision-making and profit of the supply chain mainly through the time value of funds.Both reverse factoring and dynamic discount can improve the order quantity and the production capacity of manufacturers,better meet the market demand,and alleviate the wholesale price rise caused by insufficient capital.Reverse factoring and dynamic discount can significantly improve the profits of brand makers,which is an important reason for brand companies to use reverse factoring or dynamic discount to help manufacturers finance.Reverse factoring and dynamic discount are more suitable for manufacturers with large capital gap,and reverse factoring can increase manufacturers’ profit more than dynamic discount,which is also carried out in practice.Reverse factoring and dynamic discount can increase supply chain revenue and promote supply chain cooperation.