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Gaining insight into the effects of Supply Chain Finance: the supplier perspective

In this paper we discuss what suppliers can...
26 april 2016 / 672

In this paper we discuss what suppliers can do to get insight into the effects of Reverse Factoring (RF), currently the most used form of Supply Chain Finance (SCF). Even though the usage of RF is increasing, empirical evidence is scarce, especially from the point of view of suppliers. Among suppliers there is a lack of knowledge of RF. We provide in-depth insights from six case studies based on interviews and secondary data. Employees from multiple departments were interviewed. Also buyers and banks were interviewed. The supplier cases included in our research are mainly SMEs. Our results show that increased knowledge of the supplier of RF can help to create a better negotiation position for discussing terms in the RF contract. When getting an offer to join an RF programme a supplier should start with analysing the consequences for cash flow, financing costs, current forms of financing and (long-term) collaboration with the buyer.

Keywords: reverse factoring, supply chain finance, cash flow, financing costs, supplier perspective.

Insights artikel The supplier perspective