Financial Spillover Effects in Supply Chains: Do Customers and Suppliers Really Benefit?
Studies have shown that leading supply chain companies are associated with significantly higher company financial ratios than competitors. In contrast, little research has focused on the financial performance of the affiliated suppliers and customers of such supply chain leader (SCL) companies. Thus...
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MDPI AG
2020-03-01
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| Series: | Logistics |
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| Online Access: | https://www.mdpi.com/2305-6290/4/1/6 |
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| author | Erik Hofmann Yannick Sertori |
| author_facet | Erik Hofmann Yannick Sertori |
| author_sort | Erik Hofmann |
| collection | DOAJ |
| description | Studies have shown that leading supply chain companies are associated with significantly higher company financial ratios than competitors. In contrast, little research has focused on the financial performance of the affiliated suppliers and customers of such supply chain leader (SCL) companies. Thus, the central purpose of this paper is to determine, from a financial perspective, whether suppliers and customers benefit or lose by participating in a SCL network (so called “financial spillover effects”). Companies that were ranked in the Gartner Supply Chain Top 25 were selected as SCLs. For each selected firm, the five largest suppliers and customers were identified and compared with a control sample from the same industry. In order to elaborate on existing insights into the (financial) outcome of supply chain relationships, we applied an explorative approach with abductive reasoning, while comparing the secondary data for 224 SCL supplier (56 firms) and 168 SCL customer (42 firms) firm-years with 1940 (485 firms) and 1544 (386 firms) control firm-years, respectively. The following insights are made: First, the superior financial performance of SCLs was confirmed. Second, the financial performance of suppliers and customers showed superior liquidity and activity ratios but inferior profitability ratios. Third, suppliers showed much more significant results than customers. |
| format | Article |
| id | doaj-art-c5fc789ffec244038fee862e904f8413 |
| institution | Kabale University |
| issn | 2305-6290 |
| language | English |
| publishDate | 2020-03-01 |
| publisher | MDPI AG |
| record_format | Article |
| series | Logistics |
| spelling | doaj-art-c5fc789ffec244038fee862e904f84132025-08-20T03:57:47ZengMDPI AGLogistics2305-62902020-03-0141610.3390/logistics4010006logistics4010006Financial Spillover Effects in Supply Chains: Do Customers and Suppliers Really Benefit?Erik Hofmann0Yannick Sertori1Institute of Supply Chain Management, University of St. Gallen, 9000 St. Gallen, SwitzerlandInstitute of Supply Chain Management, University of St. Gallen, 9000 St. Gallen, SwitzerlandStudies have shown that leading supply chain companies are associated with significantly higher company financial ratios than competitors. In contrast, little research has focused on the financial performance of the affiliated suppliers and customers of such supply chain leader (SCL) companies. Thus, the central purpose of this paper is to determine, from a financial perspective, whether suppliers and customers benefit or lose by participating in a SCL network (so called “financial spillover effects”). Companies that were ranked in the Gartner Supply Chain Top 25 were selected as SCLs. For each selected firm, the five largest suppliers and customers were identified and compared with a control sample from the same industry. In order to elaborate on existing insights into the (financial) outcome of supply chain relationships, we applied an explorative approach with abductive reasoning, while comparing the secondary data for 224 SCL supplier (56 firms) and 168 SCL customer (42 firms) firm-years with 1940 (485 firms) and 1544 (386 firms) control firm-years, respectively. The following insights are made: First, the superior financial performance of SCLs was confirmed. Second, the financial performance of suppliers and customers showed superior liquidity and activity ratios but inferior profitability ratios. Third, suppliers showed much more significant results than customers.https://www.mdpi.com/2305-6290/4/1/6financial performancesupply chain excellencesupply chain relationshipsupply chain financeliquidity redistributionprofitability waiverwilcoxon signed rank test |
| spellingShingle | Erik Hofmann Yannick Sertori Financial Spillover Effects in Supply Chains: Do Customers and Suppliers Really Benefit? Logistics financial performance supply chain excellence supply chain relationship supply chain finance liquidity redistribution profitability waiver wilcoxon signed rank test |
| title | Financial Spillover Effects in Supply Chains: Do Customers and Suppliers Really Benefit? |
| title_full | Financial Spillover Effects in Supply Chains: Do Customers and Suppliers Really Benefit? |
| title_fullStr | Financial Spillover Effects in Supply Chains: Do Customers and Suppliers Really Benefit? |
| title_full_unstemmed | Financial Spillover Effects in Supply Chains: Do Customers and Suppliers Really Benefit? |
| title_short | Financial Spillover Effects in Supply Chains: Do Customers and Suppliers Really Benefit? |
| title_sort | financial spillover effects in supply chains do customers and suppliers really benefit |
| topic | financial performance supply chain excellence supply chain relationship supply chain finance liquidity redistribution profitability waiver wilcoxon signed rank test |
| url | https://www.mdpi.com/2305-6290/4/1/6 |
| work_keys_str_mv | AT erikhofmann financialspillovereffectsinsupplychainsdocustomersandsuppliersreallybenefit AT yannicksertori financialspillovereffectsinsupplychainsdocustomersandsuppliersreallybenefit |