Prioritizing Risk Factors in Supply Chain Finance for Logistics Company Using Analytic Hierarchy Process
Keywords:
Analytic Hierarchy Process (AHP), Logistics Company, Supply Chain Finance (SCF)Abstract
This study aimed to identify and rank the risk factors associated with logistics companies engaged in supply chain finance (SCF) operations using the Analytic Hierarchy Process (AHP). The target population consists of three distinct groups: staff of logistics companies, professionals from financial institutions, and researchers affiliated with academic institutes. This study used questionnaire and convenient sampling to collect data. The results showed that logistics operations management, pledge management, and supply chain environment were significant dimensions of risk factors for logistics companies in SCF. The risk factors were divided into three groups: high-risk, medium-risk, and low-risk factors. The study recommends that logistics companies in SCF prioritize risk management strategies on the high-risk factors to minimize potential losses and reputational damage. Based on AHP, those high-risk factors are pledge disposal capability, pledge quality, pledge ownership, and legal & regulation. The study suggests that goods and companies can mitigate these risks by implementing advanced inventory management systems, partnering with third-party logistics providers or liquidators, seeking third-party assistance to identify the quality of the pledged goods, and conducting thorough investigations into the qualifications of applicants and the ownership of goods before conducting business. Furthermore, complying with relevant laws and regulations is crucial for logistics companies to avoid potential legal issues and safeguard the success of the SCF business. These findings can provide insights into developing effective risk management systems for logistics companies engaged in SCF operations, enhancing their ability to operate successfully in this industry.
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