551 / 2024-04-25 21:23:30

Supplier Financing with Market Research

marketing-finance interface,supply chain finance,supply chain management,game theory

Suppliers are often constrained by limited capital when producing components for downstream manufacturer. Therefore, borrowing money from this downstream manufacturer or banks is necessary. However, concerning the uncertain end demand in consumer market, it may prevent supplier from obtaining adequate funding especially when manufacturer launches new product. In this study, we investigate the role of market research in financing supplier and examine the equilibrium decisions and payoffs. The results show that whether market research facilitates supplier financing depends on such factors as prior market belief, supplier own capital, and who performs this market research.