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Managing Financially Distressed Suppliers: An Exploratory Study


  • Christoph Bode
  • Denis Hübner
  • Stephan M. Wagner


type="main" xml:id="jscm12036-abs-0001"> The early anticipation and proactive management of financially distressed suppliers have become crucial for buying firms to protect themselves against supplier default risk. To this end, firms need to be able to read the early warning signals from suppliers that are running into financial distress, to take appropriate remedial actions, and to gather such experiences in repositories of organizational knowledge for future actions. The objective of this study is to explore how and why firms differ in these behaviors and capabilities. We use the organizational information-processing perspective as a guiding theoretical framework and analyze qualitative data obtained from interviews conducted with 14 global case study manufacturing firms. By comparing these firms', behaviors in terms of scanning and interpreting warning signals, reacting to distressed or defaulting suppliers, and learning from such experiences, we are able to isolate several risk management archetypes and develop four sets of propositions that describe the occurrence of these archetypes.

Suggested Citation

  • Christoph Bode & Denis Hübner & Stephan M. Wagner, 2014. "Managing Financially Distressed Suppliers: An Exploratory Study," Journal of Supply Chain Management, Institute for Supply Management, vol. 50(4), pages 24-43, October.
  • Handle: RePEc:bla:jscmgt:v:50:y:2014:i:4:p:24-43

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    Cited by:

    1. Wagner, Stephan M. & Mizgier, Kamil J. & Papageorgiou, Stylianos, 2017. "Operational disruptions and business cycles," International Journal of Production Economics, Elsevier, vol. 183(PA), pages 66-78.
    2. Bendul, Julia C. & Skorna, Alexander C.H., 2016. "Exploring impact factors of shippers’ risk prevention activities: A European survey in transportation," Transportation Research Part E: Logistics and Transportation Review, Elsevier, vol. 90(C), pages 206-223.
    3. Christian Busse, 2016. "Doing Well by Doing Good? The Self-interest of Buying Firms and Sustainable Supply Chain Management," Journal of Supply Chain Management, Institute for Supply Management, vol. 52(2), pages 28-47, April.
    4. repec:bla:jscmgt:v:53:y:2017:i:4:p:37-66 is not listed on IDEAS

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