Competitiveness and finance of supply chains: Considerations on optimisation

The financial aspect of supply chain (SC) management is a somewhat neglected research area, while earlier papers showed that it has a strong link to competitiveness. Our main contribution to literature is to analyse the competitiveness effects of SC financial management decisions under perfect information and cooperation among SC members the absence of which may distort empirical findings. Our simulation-based research shows that even in case of perfect foresight seasonality decreases the profitability and the ability to grow while increasing the capital need. But, we also conclude that cooperation of SC members may reduce this additional capital need while enhancing the profitability and the growth, thus leading to higher competitiveness. This cooperation may be achieved through regulating payment terms or introducing special fees to be paid by the SC members to the dominating company of the SC. Thus, an economic policy aiming at providing cheap capital to firms at a lower level of SC or increasing their added value at the costs of other SC levels may decrease the competitiveness of the SC in whole.