Financial supply chain, inventory management and supply chain efficiency: An empirical insight from Kuwait

This study focuses on the factors of financial supply chain (FSC), financial institutions, and inventory for supply chain efficiency through various cost dimensions.
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Financial supply chain, inventory management and supply chain efficiency: An empirical insight from Kuwait Uncertain Supply Chain Management 7 (2019) 753–766 Contents lists available at GrowingScience Uncertain Supply Chain Management homepage: www.GrowingScience.com/uscmFinancial supply chain, inventory management and supply chain efficiency: An empirical insightfrom KuwaitAhmed Nahar Al Hussainia*a The Public Authority for Applied Education & Training, The College of Business Studies, State of KuwaitCHRONICLE ABSTRACT Article history: This study focuses on the factors of financial supply chain (FSC), financial institutions, and Received December 4, 2018 inventory for supply chain efficiency through various cost dimensions. To address this Received in revised format objective, a questionnaire is developed, based on various items of selected variables and it is January 20, 2019 presented to a targeted sample of supply chain practitioners, business managers and industry Accepted January 28 2019 Available online experts. A final sample of 216 respondents is observed for both descriptive and inferential January 28 2019 analysis. To check the significance of each indicator under FSC, financial institutions and Keywords: inventory factors, confirmatory factor analysis is conducted. Empirical facts explain that Financial supply chain factors like financial supply chain as risk prevention strategy had a significant influence on Financial institutions supply chain efficiency. Through inventory factors, communication with vendors for raw Inventory management material also indicate a significant impact on efficiency of Supply Chain (SC). This study Kuwait would help both industry experts and business managers integrate financial supply chain, inventory factors and financial institutions for cost efficiency of supply chain. The limitations of the study includes a limited sample size and restricted indicators of inventory management. Future studies can be implemented while addressing these limitations through improved econometric methods. © 2019 by the authors; licensee Growing Science, Canada.1. IntroductionDuring the last decade, financial crisis has put significant pressure on services of the financialinstitutions such as issuance of new loan facility for firms. This has increased the borrowing cost forboth manufacturing and trading concerns in the world economy (Ivashina & Scharfstein, 2010). Underthe situation of tough financial times, business organizations try to get financing facilities from thesuppliers through supplement funds sources (Garcia-Appendini & Montoriol-Garriga, 2013; Seck etal., 2013). Such issues have achieved significant attention towards various accounts in the balance sheetof the business under the title of working capital. Among various factors, financial supply chain isunder reasonable attention as explained by Petr et al. (2012) with the core objective to work for theflow of finances within the organization (Hofmann, 2005). Moreover, almost all types of businessorganizations are dealing with the financial idea of supply chain to integrate financial supply chain(FSC) with the product and information flows (Lambert & Cooper, 2000; Lamoureux & Evans, 2011).Among various academic writers, gradual interest is developed for financial supply chain or FSC which* Corresponding authorE-mail address: drahmednahar@ gmail.com (A. N. Al Hussaini)© 2019 by the authors; licensee Growing Science.doi: 10.5267/j.uscm.2019.1.004754has resulted in numerous publications during the last decade (Cattaneo et al., 2010). This literature hassignificantly highlighted different issues and perspectives of financial supply chain with solutions(Barth et al., 2001; Croom et al., 2000; Srivastava, 2007; Vickery et al., 2003).Along with the expansion of the concept of financial supply chain in the current literature, the role ofthe financial institutions in expanding and helping financial matters has been considered. Previoustheoretical and empirical findings indicate two perspectives for financial supply chain: the first oneconsiders the financial activities that defines financial trends in SC about monetary rewards (More &Basu, 2013) while the second view predicts that financial supply chain is not only merely to focus onfinancial activities in various parties, but also to study their relationships with each other (Burgess etal., 2006; Christopher & Ryals, 1999; Cooper et al., 1997; Dekker, 2003; Huselid, 1995; Meixell &Gargeya, 2005; Peppard, 2000; Vickery et al., 2003). They also assume that financial supply chaindevelops a factor of trust, delivery of products on time for the customers, level of commitment fromorganization, payment schedules and relevant negotiation, informing sharing among the parties, anddealing with the current customers needs. In their study, More and Basu (2013) explained that financialsupply chain focuse ...