IDEAS home Printed from https://ideas.repec.org/a/eee/finana/v100y2025ics1057521925000687.html
   My bibliography  Save this article

The impact of customer risk on Enterprises' strategic change: Evidence from China

Author

Listed:
  • Dong, Xiaohong
  • Cheng, Yan
  • Cheng, Chiao-Ming
  • Liu, Hung-Chun

Abstract

In an era marked by continuous advancements in the supply chain, the symbiotic nature of the relationship between customers and suppliers has become increasingly pronounced. Motivated by the research on the contagion effects of supply chain, we use Chinese A-share listed companies from 2010 to 2021 to investigate the impact of customer risk on enterprises' strategic adaptation and further elucidate the underlying mechanisms. Our results show that customer risk promotes enterprise’ strategic change by increasing the level of business risk and financing constraints. Further analyses show that customer risk can have different effects on different dimensions of firm strategic change. Meanwhile, certain environmental variables, including overconfident managers, a higher proportion of female executives, non-state-owned firms, smaller firm size, lower profitability, and a highly competitive market position, highlight the role of customer risk in driving enterprises' strategic change. Economic consequence test suggests that enterprises' implementation of strategic change enhances firm value. These conclusions offer a novel perspective on enterprise strategy dynamics and provide a theoretical framework for optimizing resource allocation, promoting healthy, and sustainable enterprise growth.

Suggested Citation

  • Dong, Xiaohong & Cheng, Yan & Cheng, Chiao-Ming & Liu, Hung-Chun, 2025. "The impact of customer risk on Enterprises' strategic change: Evidence from China," International Review of Financial Analysis, Elsevier, vol. 100(C).
    • Handle: RePEc:eee:finana:v:100:y:2025:i:c:s1057521925000687
    DOI: 10.1016/j.irfa.2025.103981
    as

    Download full text from publisher

    File URL: http://www.sciencedirect.com/science/article/pii/S1057521925000687
    Download Restriction: Full text for ScienceDirect subscribers only
    File URL: https://libkey.io/10.1016/j.irfa.2025.103981?utm_source=ideas
    LibKey link: if access is restricted and if your library uses this service, LibKey will redirect you to where you can use your library subscription to access this item
    ---><---

    As the access to this document is restricted, you may want to search for a different version of it.

    Corrections

    All material on this site has been provided by the respective publishers and authors. You can help correct errors and omissions. When requesting a correction, please mention this item's handle: RePEc:eee:finana:v:100:y:2025:i:c:s1057521925000687. See general information about how to correct material in RePEc.

    If you have authored this item and are not yet registered with RePEc, we encourage you to do it here. This allows to link your profile to this item. It also allows you to accept potential citations to this item that we are uncertain about.

    We have no bibliographic references for this item. You can help adding them by using this form .

    If you know of missing items citing this one, you can help us creating those links by adding the relevant references in the same way as above, for each refering item. If you are a registered author of this item, you may also want to check the "citations" tab in your RePEc Author Service profile, as there may be some citations waiting for confirmation.

    For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: Catherine Liu (email available below). General contact details of provider: http://www.elsevier.com/locate/inca/620166 .

    Please note that corrections may take a couple of weeks to filter through the various RePEc services.

    IDEAS is a RePEc service. RePEc uses bibliographic data supplied by the respective publishers.