Applying the Concept of Credit Guarantee on Dual Sourcing Model

• Main Authors: Po-Hua Chen, 陳伯華
• Other Authors: 蔣明晃
• Format: Others
• Language: zh-TW
• Published: 2011
• Online Access: http://ndltd.ncl.edu.tw/handle/84074618708914352635

碩士 === 國立臺灣大學 === 商學研究所 === 99 === Small and Medium Enterprises (SME) are playing an extremely important role in developing countries. Due to the shortage of capital, SMEs cannot operate effectively and efficiently to fulfill the order from downstream firms, resulting in poor performance of the supply chain. Therefore, how to help SMEs to get the financial support is quite a significant issue. In the past, numerous theories have been proposed to explain trade credit mainly from financial perspectives. This research attempts to examine the issue of trade guarantee mechanism from supply chain perspectives. Formerly, Small and Medium Enterprise Credit Guarantee Fund of Taiwan (Taiwan SMEG) which comes totally from donations made by the central government and financial institutions has developed a model of “Firefly Counterpart Guarantee.” Based on this model, government expects to combine upstream firms with downstream, sharing the risk of financial loan with the bank. This research cites the model of “Firefly Counterpart Guarantee” as background to develop a model of credit guarantee on dual sourcing. In this model, there are four roles, including manufacturer, supplier, retailer, and the bank. The manufacturer is a starter of the entire mechanism and it should fulfill the retailer’s demand as much as possible. Besides, in order to minimize its cost based on each default scenario, manufacturer should decide the optimal order with suppliers and negotiate what’s the shared proportion of default risk with bank. Finally, we use specific number to do sensitive analysis. Under this mechanism, the results show that the bank will charge two suppliers the highest loan interest rate when manufacturer tries to lower the shared proportion of default risk with bank. In addition, the higher suppliers’ default probability is, the more demand from manufacturer will be ordered. We could explain this situation that manufacturer tries to avoid paying the default cost to downstream retailers. This research adjusts each parameter to realize what factors will influence SMEs cost when using the trade guarantee mechanism. On the other hand, the result also provides an important reference for upstream firms if they negotiate what’s the shared proportion of default risk with bank.