Promoting supply chain financing performance of SMEs based on the extended resource-based perspective

Abstract

Purpose As an effective mode to help small and medium enterprises (SMEs) raise working capital, supply chain finance has recently gained extensive attention. The purpose of this paper is to explore the intrinsic mechanism of how both weak and strong ties in the supply chain network impact the supply chain financing performance (SCFP) of SMEs from the perspective of the supply chain network. Design/methodology/approach Based on the extended resource-based perspective, this paper proposes a theoretical model to explain the mode in which strong ties and weak ties of SMEs in the supply chain network influence SCFP through both physical distribution flexibility and demand management flexibility. Based on data from 182 manufacturing firms in China, this paper uses multiple regression analysis to test hypotheses. Findings The results of this paper indicate that weak ties improve SCFP more effectively than strong ties. Furthermore, both physical distribution flexibility and demand management flexibility exert different mediating roles either between strong ties and SCFP or between weak ties and SCFP. Moreover, the effect of physical distribution flexibility and demand management flexibility on SCFP of SMEs is not reinforced. Originality/value This paper highlights the importance to expand supply chain finance research from the perspective of the supply chain network. In particular, this paper explores the poorly understood mediating effect both physical distribution flexibility and demand management flexibility exert on the relationship between network ties and the SCFP of SMEs.