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Risk, Financing and the Optimal Number of Suppliers

  • Volodymyr Babich
  • Göker Aydın
  • Pierre-Yves Brunet
  • Jussi Keppo
  • Romesh Saigal
Chapter

Abstract

Should firms in developed economies work with more or fewer suppliers than firms in developing economies? More generally, how does the number of suppliers for a firm depend on the firm’s economic environment? To answer these questions we identify several economic and business factors that might affect the number of suppliers (and that separate developed and developing economies): supply risk, fixed costs of working with suppliers, and access to financing (particularly trade-credit financing).

Keywords

Fixed Cost Order Quantity Wholesale Price Limited Liability Internal Capital 
These keywords were added by machine and not by the authors. This process is experimental and the keywords may be updated as the learning algorithm improves.

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Copyright information

© Springer-Verlag London Limited 2012

Authors and Affiliations

  • Volodymyr Babich
    • 1
  • Göker Aydın
    • 2
  • Pierre-Yves Brunet
    • 3
    • 4
  • Jussi Keppo
    • 3
  • Romesh Saigal
    • 3
  1. 1.McDonough School of BusinessGeorgetown UniversityWashingtonUSA
  2. 2.Kelley School of BusinessIndiana UniversityBloomingtonUSA
  3. 3.Industrial and Operations EngineeringUniversity of MichiganAnn ArborUSA
  4. 4.Credit Risk OfficeBarclays Bank PLCLong Island CityUSA

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