Working capital in collaborative supply chain during crisis: еhe case of Ahlers сompany

Abstract

Description of the goal, tasks and main results Goal: modify Collaborative Cash Conversion Cycle model as the measure of working capital in collaborative supply chain during crisis for 3PL provider industry. Main tasks: create the value and supply chain of 3PL provider; analyze the impact of financial crisis on cycle time of working capital through the value and supply chain of 3PL provider from the suppliers to end customers; estimate the factor of crisis for 3PL providers and related companies; modify Collaborative Cash Conversion Cycle model by the implementation of the factor of crisis; apply the modified model into the Case Company; analyze the change of the cycle time of working capital and financial cost in collaborative supply chains of Case Company; Main results: 1. Results of the Financial value chain analysis showed that during the financial crisis 2008-2009 the cycle time of working capital increased at all stages of value and supply chain of 3PL providers except for chemical companies. 2. Results of the implementation of factor of crisis into collaborative CCC was that the modified Cash Conversion Cycle model was introduced that illustrates how to estimate the WC in collaborative supply chain with adjustment to the impact of crisis for 3PL provider industry. 3. Analysis of modified model showed that the cycle time of working capital and total financing cost of the 1st and 2nd collaborative supply chains of the Case Company increased by around the same percentage as in financial crisis of 2008-2009. 4. Results of the simulation with three scenarios showed that in three collaborative chains of the Case Company to decrease total financing costs during crisis companies need to apply WC management that connected to reduction of DIO or DSO components or increase of DPO component of CCC. 5. The third scenario with shortening of the DSO component showed the best improvement in cycle time of working capital and in reduction of total financing cost in collaborative chains of the Case Company.