Accounting Seminar（2015-08）

Topic:Sources of Customer-Base Concentration and Supplier Performance

Speaker:Ella Mae Matsumura (University of Wisconsin-Madison)

Time:Friday,24 April, 10:00-11:30 am

Location:Room 217, Guanghua Building 2

Organizer:Department of Accounting,MPAcc GSM, PKU

Abstract：

Studies of customer-base concentration attribute its positive relation with supplier firm performance to supply chain efficiencies. We offer a broader interpretation of the evidence by examining sources of customer-base concentration. Our analysis uses a conceptual framework that describes strategy as encompassing the definition of business scope and the development of sustainable competitive advantage. We use a sample of apparel suppliers to estimate the source of customer-base concentration pertaining to each aspect of supplier strategy, and present evidence that the favorable relation between customer-base concentration and supplier financial performance relates most strongly to competitive advantage. Concentration due to business scope is associated with lower advertising costs and allowances for doubtful accounts, but competitive advantage relates most strongly to inventory turnover and working capital management efficiencies. We conclude that fundamental elements of supplier strategy, particularly the development of competitive advantage, are a likely channel through which customer-base concentration relates to supplier performance.

Your participation is warmly welcomed!