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On delineating supply chain cash flow under collectionrisk

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  • Tsai, Chih-Yang

Abstract

The credit terms for accounts receivable (AR) offered by sellers to buyers not only create a time lag between supply chain physical flow and cash flow, but also increase the collection risk contributed by late collection and default. Previous studies describing the relationship between the two major supply chain flows did not consider the collection risk, which poses a serious challenge to companies with limited cash resources when seeking growth opportunities in sales. This study first delineates the relationship between the two flows during a growth period without imposing any constraints. A stochastic optimization model is then developed to observe the managerial implications of cash flow risk under tight cash constraints.

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  • Tsai, Chih-Yang, 2011. "On delineating supply chain cash flow under collectionrisk," International Journal of Production Economics, Elsevier, vol. 129(1), pages 186-194, January.
    • Handle: RePEc:eee:proeco:v:129:y:2011:i:1:p:186-194
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    References listed on IDEAS

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    Cited by:

    1. Kroes, James R. & Manikas, Andrew S., 2014. "Cash flow management and manufacturing firm financial performance: A longitudinal perspective," International Journal of Production Economics, Elsevier, vol. 148(C), pages 37-50.
    2. Chih-Yang Tsai, 2017. "The impact of cost structure on supply chain cash flow risk," International Journal of Production Research, Taylor & Francis Journals, vol. 55(22), pages 6624-6637, November.
    3. Schwab, Leila & Gold, Stefan & Reiner, Gerald, 2019. "Exploring financial sustainability of SMEs during periods of production growth: A simulation study," International Journal of Production Economics, Elsevier, vol. 212(C), pages 8-18.
    4. Heba F. Zaher & Gilberto Marquez‐Illescas, 2024. "CEO narcissism and firm's cash conversion cycle: The moderating role of CEO's gender," Accounting and Finance, Accounting and Finance Association of Australia and New Zealand, vol. 64(1), pages 783-810, March.
    5. Hicham Lamzaouek & Hicham Drissi & Naima El Haoud, 2021. "Cash Flow Bullwhip—Literature Review and Research Perspectives," Logistics, MDPI, vol. 5(1), pages 1-9, January.
    6. Chakuu, Sumeer & Masi, Donato & Godsell, Janet, 2019. "Exploring the relationship between mechanisms, actors and instruments in supply chain finance: A systematic literature review," International Journal of Production Economics, Elsevier, vol. 216(C), pages 35-53.

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