Please use this identifier to cite or link to this item: https://ir.iimcal.ac.in:8443/jspui/handle/123456789/4647
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dc.contributor.authorRath, Sambit Brata
dc.contributor.authorBasu, Preetam
dc.contributor.authorMandal, Prasenjit
dc.contributor.authorPaul, Samit
dc.date.accessioned2024-01-28T14:05:37Z
dc.date.available2024-01-28T14:05:37Z
dc.date.issued2021-11
dc.identifier.issn1366-5545 (online)
dc.identifier.urihttps://ir.iimcal.ac.in:8443/jspui/handle/123456789/4647
dc.identifier.urihttps://doi.org/10.1016/j.tre.2021.102468
dc.descriptionBiosketch: Sambit Brata Rath, Preetam Basu & Prasenjit Mandal, Operations Management Group, Indian Institute of Management Calcutta, Diamond Harbor Road, Kolkata 700104, India; Samit Paul, Finance and Control Group, Indian Institute of Management Calcutta, Diamond Harbor Road, Kolkata 700104, India.en_US
dc.description.abstractThird-party sellers on e-commerce marketplaces (e.g., Amazon and Alibaba) have been primarily dependent on conventional financing modes such as bank credit financing (BCF) to meet their working capital requirements. Many of these platforms have recently started novel financing programs (platform credit financing, PCF) for the sellers under the umbrella of Supply Chain Finance. For example, Amazon provides unsecured loans to third-party sellers on its platform under the Amazon lending program. These loans are risky for the platform. If the seller is unable to fulfill customer’s orders because of some internal inefficiencies (performance risk), the platform loses the loan amount and incurs a goodwill cost among its customer base. In this paper, we develop a series of game-theoretic models to analyze and compare BCF and PCF for a cash-constrained third-party seller on an e-commerce marketplace. We derive optimal interest rates that the platform may charge the seller depending on its performance risk. We derive conditions under which either BCF or PCF could be more profitable for the seller. We introduce innovative contracts (Guaranteed Demand Increment Contract and Lending Rate Matching Contract initiated by the platform and Lumpsum Transfer Contract initiated by the seller) that incentivize the seller or platform to act in a mutually beneficial way. Our analysis shows that these contracts achieve win–win outcomes and increase the total supply chain profit.en_US
dc.language.isoen_USen_US
dc.publisherTransportation Research Part E: Logistics and Transportation Reviewen_US
dc.relation.ispartofseriesVol. 155;
dc.subjectE-commerceen_US
dc.subjectSupply chain financeen_US
dc.subjectPerformance risken_US
dc.subjectContracten_US
dc.subjectGame theoryen_US
dc.titleFinancing models for an online seller with performance risk in an E-commerce marketplaceen_US
dc.typeArticleen_US
Appears in Collections:Operations Management

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