Where you stand depends on where you sit: research on supply chain finance from the perspective of retailers

With the advancement of supply chain finance (SCF), supply chains have flourished, leading to the emergence of supply chains centered around other enterprises, such as retailers and logistics companies, challenging the traditional BLCTOP model that focuses solely on suppliers as the focal enterprise. We examine a model where the retailer is the focal enterprise. In our model, retailer defaults on payments trigger a price increase from the supplier as a countermeasure. We transform this scenario into a non-linear programming model and solve it using GAMS software. By using numerical simulations, we examine how varying parameters influence credit terms and profitability. We also explore the combined effects of varying two parameters simultaneously. By positioning the retailer as the leader, we provide insights for retailer enterprises to make more comprehensive and effective strategic decisions in the future. Our findings highlight the importance of strategic flexibility in managing supply chain relationships and offer practical recommendations for optimizing credit terms and enhancing profitability.