Supply chain finance schemes in the procurement of agricultural products

In this article, wes developed a quantitative model to compare HT and CF supply chain finance schemes with each other and with traditional, fixed-price delivery contracts, which we identify as Soft Tolling (ST). We make this comparison in the setting of a three-echelon agricultural supply chain, where the third echelon is a large, creditworthy food/beverage manufacturer. This article proceeds as follows: the next section discusses related literature. Section 3 presents our model of an agricultural supply chain and the three specific contract variants (ST, HT, or CF) that we study. In Section 4, the model is parameterized to reflect the specific case of the barley–malt supply chain for Heineken N.V. and the solution for a base case is described. Section 5 presents a sensitivity analysis on the funding costs in the base case, revealing their impact on Heineken's preferred SCF scheme. Section 6 provides conclusions and indicates directions for future research.