Optimal Financing Decisions of Two Cash-Constrained Supply Chains with Complementary Products

• Main Authors: Yuting Li, Tong Chen, Baogui Xin
• Format: Article
• Language: English
• Published: MDPI AG 2016-04-01
• Series: Sustainability
• Subjects: supply chain management; complementary products; joint financing; Stackelberg game; optimal decisions; cash constrains
• Online Access: http://www.mdpi.com/2071-1050/8/5/429

In recent years; financing difficulties have been obsessed small and medium enterprises (SMEs); especially emerging SMEs. Inter-members’ joint financing within a supply chain is one of solutions for SMEs. How about members’ joint financing of inter-supply chains? In order to answer the question, we firstly employ the Stackelberg game to propose three kinds of financing decision models of two cash-constrained supply chains with complementary products. Secondly, we analyze qualitatively these models and find the joint financing decision of the two supply chains is the most optimal one. Lastly, we conduct some numerical simulations not only to illustrate above results but also to find that the larger are cross-price sensitivity coefficients; the higher is the motivation for participants to make joint financing decisions; and the more are profits for them to gain.