The Optimal Financing Method And Procurement Channel Selection For Capital-constrained Manufacturers

In recent years,with the rise of China’s manufacturing industry,Western developed countries have begun to re-recognize the significance of manufacturing and put forward their own industrial revitalization plans.In Industry 4.0,manufacturers are the main force behind the transformation and modernization of manufacturing.Although manufacturers play a vital role in economic and social development.However,due to the capital constraints and financing difficulties of small and medium-sized enterprises in the upstream and downstream of the supply chain,the operation and financing coordination of SC are often difficult to achieve.The emergence of supply chain finance(SCF)is to effectively alleviate the financing difficulties of small and medium-sized businesses.Easing financing difficulties for S&M enterprises is not only a pressing problem faced by manufacturers at all levels in SC,but also an important area of research by scholars related to SC.Therefore,it is of great practical and theoretical value for the development of manufacturing industry to solve the financing problem of capital-constrained SMEs.In order to solve these problems,the following three aspects discussed in this study.Firstly,it reviews the research results of SCF at home and abroad,and summarizes the definition,development status and classification of SCF,it meanwhile introduces the principle and main contents of Stackelberg game and backward induction.Secondly,in order to solve the problem of financing difficulties for manufacturers in single-channel procurement supply chain,this study analyzes and discusses two financing contracts: partial credit guarantee and inventory pledge financing,and puts forward the corresponding suggestions are grounded in comparing the merits and demerits of the two contracts.Finally,this paper discusses the decision-making of the manufacturer’s financing and purchasing channel selection in the dual-channel purchasing supply chain,and constructs the model for the supplier with unreliable supply and the manufacturer with limited capital,provide decision-making advice to manufacturers.The conclusions are as follows:Supplier credit guarantees can provide credit guarantees for capital-constrained manufacturers to finance banks,and suppliers can share part of the risks borne by banks,greatly reducing the difficulty of manufacturers to obtain financing.In addition,supplier guarantees can significantly increase manufacturers’ orders and reduce their bankruptcy risk.They can also reduce banks’ lending rates and manufacturers’ financing costs.(2)The supplier’s repurchase behavior in inventory pledge financing can make up part of the loss of the bank after the unsalable market of the manufacturer.And the optimal pledge rate of the bank will rise as the repurchase rate offered by the supplier increases.Therefore,the repurchase behavior can reduce the manufacturer’s inventory risk,but also reduce the manufacturer’s bankruptcy risk.When bank interest rates or wholesale prices rise,the risk of bankruptcy and the expected profits of the manufacturer decrease.(3)When capital-constrained manufacturers are offered two procurement channels,the results show that manufacturers prefer single-channel procurement in most cases.However,when suppliers of unreliable supply channels have low capital levels and face high financing rates,they will be more inclined to choose dual-channel procurement.Additionally,where a single procurement channel is available,there is an interest rate frontier that separates the dominance of unreliable and reliable supply channels.And when capital is constrained and banks set lower interest rates,manufacturers are more inclined to buy from unreliable suppliers.