How do financial constraints and financing costs affect inventories? An empirical supply chain perspective

2017 ◽  
Vol 47 (6) ◽  
pp. 516-535 ◽  
Author(s):  
Kai Hoberg ◽  
Margarita Protopappa-Sieke ◽  
Sebastian Steinker
Keyword(s):  
Supply Chain ◽  
Inventory Management ◽  
Financial Constraints ◽  
Cost Of Capital ◽  
Secondary Data ◽  
Supplier Relationships ◽  
Financial Situation ◽  
Content Type ◽  
Financial Perspective ◽  
Financing Costs

Purpose The purpose of this paper is to identify the interplay between a firm’s financial situation and its inventory ownership in a single-firm and a two-firm perspective. Design/methodology/approach The analysis uses different secondary data sources to quantify the effect of both financial constraints and cost of capital on inventory holdings of public US firms. The authors first adopt a single-firm perspective and analyze whether financial constraints and cost of capital do generally affect the amount of inventory held. Next, the authors adopt a two-firm perspective and analyze the inventory ownership in customer-supplier relationships. Findings Inventory levels are affected by financial constraints and cost of capital. Results indicate that higher costs of capital are weakly associated with lower inventories. However, contrary to the authors’ expectations, firms that are less financially constrained hold less inventories than firms that are more financially constrained. Finally, the authors find that customers hold the larger fraction of supply chain inventory in supplier-customer dyads. Practical implications The authors’ results indicate that financial considerations generally play a role in inventory management. However, inventory holdings seem to be influenced only slightly by financing costs and inventory holdings between supplier and customer seem to be less than optimal from a financial perspective. Considering those financial aspects can lead to relevant financial advantages. Originality/value In contrast to other recent research, the authors study how the financial situation of a firm affects its inventory levels (not vice versa) and also consider inventories from a two-firm perspective.

A systematic literature review of healthcare supply chain and implications of future research

2019 ◽  
Vol 13 (4) ◽  
pp. 405-435 ◽  
Author(s):  
Anuj Dixit ◽  
Srikanta Routroy ◽  
Sunil Kumar Dubey
Keyword(s):  
Supply Chain ◽  
Literature Review ◽  
Inventory Management ◽  
Cold Chain ◽  
Future Research ◽  
Research Papers ◽  
Content Type ◽  
Drug Manufacturing ◽  
Customer Training

Purpose This paper aims to review the healthcare supply chain (HSC) literature along various areas and to find out the gap in it. Design/methodology/approach In total, 143 research papers were reviewed during 1996-2017. A critical review was carried out in various dimensions such as research methodologies/data collection method (empirical, case study and literature review) and inquiry mode of research methodology (qualitative, quantitative and mixed), country-specific, targeted area, research aim and year of publication. Findings Supply chain (SC) operations, performance measurement, inventory management, lean and agile operation, and use of information technology were well studied and analyzed, however, employee and customer training, tracking and visibility of medicines, cold chain management, human resource practices, risk management and waste management are felt to be important areas but not much attention were made in this direction. Research limitations/implications Mainly drug and vaccine SC were considered in current study of HSC while SC along healthcare equipment and machine, hospitality and drug manufacturing related papers were excluded in this study. Practical implications This literature review has recognized and analyzed various issues relevant to HSC and shows the direction for future research to develop an efficient and effective HSC. Originality/value The insight of various aspects of HSC was explored in general for better and deeper understanding of it for designing of an efficient and competent HSC. The outcomes of the study may form a basis to decide direction of future research.

Strategic supplier relationships and supply chain resilience: Is digital transformation that precludes trust beneficial?

2021 ◽  
Vol ahead-of-print (ahead-of-print) ◽  
Author(s):  
Murtaza Faruquee ◽  
Antony Paulraj ◽  
Chandra Ade Irawan
Keyword(s):  
Supply Chain ◽  
Problem Solving ◽  
Manufacturing Firms ◽  
Digital Transformation ◽  
Supplier Relationships ◽  
Content Type ◽  
Supply Chain Resilience ◽  
Joint Problem ◽  
The Right ◽  
Joint Problem Solving

PurposeThe purpose of this study is to investigate the role that communication, trust and digital transformation can play in the relationship between joint problem-solving and supply chain resilience. More specifically, the authors try to examine the possibility of digital transformation as a replacement for trust within a joint problem-solving context.Design/methodology/approachA survey instrument was developed and administrated to manufacturing firms within the United Kingdom and the United States. Based on data collected from 291 senior managers, multiple linear regressions were conducted through a customized process model to test the proposed hypotheses.FindingsThe results point to the actual impact of digital transformation being far more complicated than the initial benefits that it appears to bring within a supply chain. Thus, technology is only effective when applied within the right context. The authors showcase that the trio of digital transformation, trust and joint problem-solving can be highly valuable to establish supply chain resilience and that further investigation on the interrelationships between these concepts is warranted.Practical implicationsManufacturing firms that aim to adopt new technologies should not consider advanced digital technologies as an alternative to trust. While digital transformation can improve resource sharing and integration, governance mechanisms–such as trust–will remain the cornerstones of strategic supplier relationships. Therefore, supply chain partners must strive to achieve a balance between trust and the right type of digital technology.Originality/valueThis study contributes to the growing literature focusing on the role that digital transformation can play in developing supply chain capabilities. It adds an early empirical insight on the role of technology and governance in joint problem-solving and supply chain resilience.

Episodic supply chains at times of disruption

2021 ◽  
Vol ahead-of-print (ahead-of-print) ◽  
Author(s):  
Christina Öberg
Keyword(s):  
Supply Chain ◽  
Additive Manufacturing ◽  
Supply Chains ◽  
Design Methodology ◽  
Secondary Data ◽  
Transformational Change ◽  
Content Type ◽  
Metal Additive Manufacturing ◽  
Contemporary Technology ◽  
Metal Additive

Purpose Additive manufacturing has been described as converting supply chains into demand chains. By focusing on metal additive manufacturing as a contemporary technology causing ongoing disruption to the supply chain, the purpose of this paper is to describe and discuss how incumbent firms act during an ongoing, transformational disruption of their supply chain. Design/methodology/approach Interviews and secondary data, along with seminars attracting approximately 600 individuals operating in metal additive manufacturing, form the empirical basis for this paper. Findings The findings of this paper indicate how disruption occurs at multiple positions in the supply chain. Episodic positions as conceptualised in this paper refer to how parties challenged by disruption attempt to reach normality while speeding the transformational disruption. Originality/value This paper contributes to previous research by theorising about episodic positions in light of a supply chain disruption. The empirical data are unique in how they capture supply chain change at the time of disruption and illustrate disruptive, transformational change to supply chains. The paper interlinks research on disruption from the innovation and supply chain literature, with contributions to both.

scholarly journals Framework for successful supply chain implementation in healthcare area from provider’s prospective

2018 ◽  
Vol 12 (2) ◽  
pp. 135-145 ◽  
Author(s):  
Ik-Whan Kwon ◽  
Sung-Ho Kim
Keyword(s):  
Health Care ◽  
Supply Chain ◽  
Inventory Management ◽  
Health Care Providers ◽  
Management Practices ◽  
Cost Of Care ◽  
Care Providers ◽  
Financial Health ◽  
Content Type ◽  
Supply Chain Finance

Purpose This paper aims to explore avenue where suppliers and manufacturers are aligned with health-care providers to improve supply chain visibility. Supply chain finance is explored to link suppliers/manufacturers with health-care providers. Design/methodology/approach Existing literature on supply chain visibility in health care forms a basis to achieve the study purpose. Alignment calls also for financial health where supply chain partners’ working capital is readily available to execute joint supply chain plan. Findings There is a disjoint in supply chain alliance between suppliers/manufacturers and providers where providers are unable to trace the origin of supplies. Quality care suffers and cost of care rises as providers search for supplies on an emergency basis. This paper provides a framework where solution can be formulated. Research limitations/implications Suppliers/manufactures form a direct strategic alliance with providers where product visibility enables health-care providers with a better patient management with lower cost of supplies. Inventory management and logistics cost will be lowered as better planning/forecasting is in place. This paper does not call for testing any hypothesis. Perhaps, next move along this line will be to investigate financial health of supply chain partners based on supplier relationship management practices. Originality/value This paper proposes health-care supply chain as an alternative solution to achieve the following twin purposes: controlling the cost while improving quality of care through supply chain finance. As far as we know, this study is the first attempt to achieve the goals.

scholarly journals Reading on and between the lines: risk identification in collaborative and adversarial buyer–supplier relationships

2018 ◽  
Vol 23 (4) ◽  
pp. 351-376 ◽  
Author(s):  
Yiyi Fan ◽  
Mark Stevenson
Keyword(s):  
Social Capital ◽  
Supply Chain ◽  
Risk Identification ◽  
Social Capital Theory ◽  
Future Research ◽  
Supplier Relationships ◽  
Content Type ◽  
Signalling Theory ◽  
Multi Level ◽  
The Impact

Purpose This paper aims to investigate how supply chain risks can be identified in both collaborative and adversarial buyer–supplier relationships (BSRs). Design/methodology/approach This research includes a multiple-case study involving ten Chinese manufacturers with two informants per organisation. Data have been interpreted from a multi-level social capital perspective (i.e. from both an individual and organisational level), supplemented by signalling theory. Findings Buyers use different risk identification strategies or apply the same strategy in different ways according to the BSR type. The impact of organisational social capital on risk identification is contingent upon the degree to which individual social capital is deployed in a way that benefits an individual’s own agenda versus that of the organisation. Signalling theory generally complements social capital theory and helps further understand how buyers can identify risks, especially in adversarial BSRs, e.g. by using indirect signals from suppliers or other supply chain actors to “read between the lines” and anticipate risks. Research limitations/implications Data collection is focussed on China and is from the buyer side only. Future research could explore other contexts and include the supplier perspective. Practical implications The types of relationships that are developed by buyers with their supply chain partners at an organisational and an individual level have implications for risk exposure and how risks can be identified. The multi-level analysis highlights how strategies such as employee rotation and retention can be deployed to support risk identification. Originality/value Much of the extant literature on supply chain risk management is focussed on risk mitigation, whereas risk identification is under-represented. A unique case-based insight is provided into risk identification in different types of BSRs by using a multi-level social capital approach complemented by signalling theory.

Detecting counterfeit pharmaceutical drugs

2019 ◽  
Vol 26 (4) ◽  
pp. 1027-1047
Author(s):  
Dominic Peltier-Rivest ◽  
Carl Pacini
Keyword(s):  
Supply Chain ◽  
Inventory Management ◽  
Prevention Strategy ◽  
Pharmaceutical Drugs ◽  
Counterfeit Drugs ◽  
Pharmaceutical Supply Chain ◽  
Content Type ◽  
Forensic Accounting ◽  
Recent Estimate ◽  
Multi Stakeholder

Purpose This paper aims to analyze drug counterfeiting, explains its risk factors and operating and legal environments reviews recent legal cases and develops a multi-stakeholder prevention strategy that includes forensic accounting methods. Design/methodology/approach This is a theoretical study based on legal case studies and the best forensic accounting strategies. Findings Pharmaceutical drug counterfeiting is a fast-growing fraud that so far has attracted little attention from forensic accountants. A recent estimate projects that criminals collect around $75bn annually in illicit sales from counterfeit drugs (Bairu, 2015). Pharmaceutical counterfeiting also leads to the loss of lives when criminals use lethal chemicals in the manufacturing of fake medicines (Liang, 2006a; Brown, 2005). Because the detection of drug counterfeiting is extremely difficult after fake medicines have been ingested by patients, the strategy developed in this paper is based on early discovery by using reliable tracking technologies and inventory management controls in the supply chain, conducting effective regulatory and legitimate customs inspections, and increasing consumer awareness of basic forensic accounting tools. Research limitations/implications This paper extends previous research by integrating various factors into a single multi-stakeholder prevention framework. Practical implications The paper presents a synthesized, comprehensive view of the drug fraud epidemic and analyzes concrete steps that can be taken to protect the pharmaceutical supply chain to reduce the loss of lives and monetary injuries. Originality/value No previous research has analyzed this issue from a multi-stakeholder point of view and used forensic accounting tools to complement a prevention strategy. The drug counterfeiting prevention strategy developed in this paper addresses the supply side, the regulatory enforcement side and the demand side.

Relationships along the organic supply chain

2019 ◽  
Vol 121 (3) ◽  
pp. 771-786 ◽  
Author(s):  
Haley Baron ◽  
Carolyn Dimitri
Keyword(s):  
Supply Chain ◽  
Consumer Demand ◽  
Structured Interviews ◽  
Supplier Relationships ◽  
Content Type ◽  
Supply Chain Relationships ◽  
The Us ◽  
The Usa ◽  
Certified Organic ◽  
National Organic Program

Purpose Since the implementation of the National Organic Program in 2002, the US organic market has grown in both scale and scope, consequently placing pressure on the organic supply chain. The crucial role of matching consumer demand for final products with farm-level production falls to certified organic handlers, the intermediary firms that process, manufacture and distribute organic products. Locating certified organic commodities and products that meet their needs, in a timely manner, is costly and challenging. The paper aims to discuss these issues. Design/methodology/approach A mixed-methods study was designed to better understand organic sector supply chain relationships in the USA. Data were collected from certified organic handlers via survey and semi-structured interviews. Those interviewed were randomly selected from 153 survey respondents who expressed an interest in being interviewed. This paper presents an analysis of interviews with 26 certified organic handlers regarding the relationships with their suppliers. Findings Three key concepts characterize the relationships between handlers and their suppliers: closeness, support and commitment. Nearly all handler supplier relationships possess some degree of closeness, where the handler expresses interest in their supplier. The relationships follow a spectrum of intensity, where the least engaged handlers provide little support and commitment, and the most engaged handlers provide support and commitment through a long-term relationship or contract. Originality/value Research into the organic supply chain is challenging to undertake, given the proprietary nature of the relationships. As the organic market continues to grow, the relationships along the supply chain will need to evolve to allow firms to meet consumer demand.

Supply chain corruption practices circumventing sustainability standards: wolves in sheep's clothing

2020 ◽  
Vol 40 (12) ◽  
pp. 1873-1907
Author(s):  
Bruno S. Silvestre ◽  
Fernando Luiz E. Viana ◽  
Marcelo de Sousa Monteiro
Keyword(s):  
Supply Chain ◽  
Supply Chain Management ◽  
Supply Chains ◽  
Secondary Data ◽  
The Novel ◽  
Sustainable Supply Chain ◽  
Chain Management ◽  
Content Type ◽  
Sustainability Standards ◽  
Business Corruption

PurposeA growing number of private, voluntary and mandatory sustainability standards have recently emerged. However, supply chain corruption practices as mechanisms to circumvent sustainability standards have also grown and occur regularly. This paper strives to elaborate theory on the intersection of institutional theory, business corruption and the sustainability standards literature by investigating factors that influence the emergence of supply chain corruption practices.Design/methodology/approachBased on secondary data, four in-depth case studies of supply chain corruption practices are investigated through the use of adaptive theory and the method of constant comparisons to elaborate theory on this important phenomenon.FindingsThe paper suggests that although sustainability standards can improve supply chain sustainability performance, if they are adopted only symbolically and not substantively, unanticipated outcomes such as supply chain corruption may occur. The study proposes a typology of supply chain corruption practices, further explores the symbolic adoption of sustainability standards in supply chains and proposes the novel construct of “social isomorphism for corruption.” Since focal companies play central roles in leading supply chain corruption practices, we reason that they can also play a pivotal role in preventing supply chain corruption practices by promoting the substantive adoption of sustainability standards across their supply chains.Originality/valueThis paper elaborates theory on the challenging phenomenon of corruption in supply chains by linking the supply chain management literature to the corruption and the sustainability discourses and offers important insights to aid our understanding on the topic. It generates six propositions and four contributions to the sustainable supply chain management theory, practice and policy.

scholarly journals Improving retail supply flexibility using buyer-supplier relational capabilities

2017 ◽  
Vol 37 (3) ◽  
pp. 343-362 ◽  
Author(s):  
Raymond Obayi ◽  
S.C. Koh ◽  
David Oglethorpe ◽  
Seyed M. Ebrahimi
Keyword(s):  
Supply Chain ◽  
Supplier Relationships ◽  
Chain Flexibility ◽  
Content Type ◽  
Mediating Role ◽  
Supply Chain Flexibility ◽  
And Performance ◽  
Relational Capabilities ◽  
Practical Implications

Purpose The purpose of this paper is to investigate the mediating role of three important relational capabilities – absorptive capacity (AC), transactive memory systems (TMS), and organisational interoperability (OI); on the flexibility of buyer-supplier relationships and performance in retail supply chains. Drawing on the relational view of strategic management, the impact of relational capabilities on two forms of supply chain flexibility is examined – configuration flexibility (CF) for switching suppliers with minimal penalties, and planning and control flexibility (PCF) for altering supply schedules, quality, and delivery lead-time. Design/methodology/approach Strategic- and tactical-level managers from 211 retail stores in the UK were surveyed. The authors validated a measurement model with structural equation modelling and tested four hypotheses on the mediating role of relational capabilities on supply chain flexibility and retail performance, controlling for size, duration of relationship, and market segment. Findings Results showed that the three relational capabilities partially mediated the positive effect of CF and PCF on operational performance in big middle and niche retailers. Examining the interaction effect of the forms of flexibility on the relational capabilities and performance, the authors found positive interaction effects on TMS and OI but a non-significant effect on AC. Practical implications In addition to providing novel theoretical insights on supply chain flexibility, the findings have practical implications for supplier selection and buyer-supplier relationship management. Originality/value Overall, the study highlights the impacts of relational capabilities on adopted operational strategies such as flexibility, buyer-supplier relationships, and retail performance.

Attraction in buyer–supplier relationships

2019 ◽  
Vol 25 (2) ◽  
pp. 347-367 ◽  
Author(s):  
Andrea S. Patrucco ◽  
Davide Luzzini ◽  
Antonella Moretto ◽  
Stefano Ronchi
Keyword(s):  
Supply Chain ◽  
Equation Modeling ◽  
Collaborative Relationships ◽  
Cost Performance ◽  
Supplier Relationships ◽  
Content Type ◽  
Structured Equation Modeling ◽  
The One ◽  
Supplier Collaboration

PurposeThe purpose of this paper is to shed light on the dynamics of buyer–supplier industrial relationships and the role of customer attractiveness—a requisite to obtain best efforts from suppliers involved in collaborative initiatives.Design/methodology/approachThe paper develops a theoretical framework tested through an international survey with a structured equation modeling approach.FindingsResults confirm that customer attractiveness positively affects both innovation and cost performance ensured by suppliers. Moreover, several direct and indirect antecedents of customer attractiveness are identified, including characteristics of the buying firm’s procurement department (i.e. procurement knowledge and procurement status) and supply chain relationship characteristics (i.e. proficiency of supplier collaboration and visibility).Research limitations/implicationsBecause of the survey approach, the research results are limited to the data collected.Practical implicationsFindings support the relevance of collaborative relationships in improving performance, and the key role procurement department could play in managing the multifaceted aspects of supplier collaboration.Originality/valueThis paper investigates, on the one hand, why customer attractiveness is relevant for supply chain management, and what are the effects on innovation and cost performance ensured by suppliers; on the other hand, antecedents of customer attractiveness are considered, with a main focus on organizational and relational procurement variables.

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