Supply Chain Finance Risks under Heterogeneous Market Structures: A Comparative Analysis of Monopoly, Oligopoly and Competitive Markets

Abstract

Supply chain finance (SCF) has become an important financing mechanism for improving liquidity and supporting small and medium-sized enterprises. Existing research mainly focuses on credit risk, operational risk and digital financial technology, while paying limited attention to the role of market structure in shaping supply chain financial risks. This article explores how different market structures affect financing availability, liquidity pressure and risk transmission by comparing three representative industries - the power grid industry (monopoly), the electric vehicle industry (oligopoly) and the fast fashion industry (competitive market). The study draws on the theory of industrial organization, uses the Herfindahl - Hirschman Index (HHI) to assess market concentration, and employs the Cash Conversion Cycle (CCC) to evaluate working capital efficiency when comparable financial data is available. Research has found that monopolistic industries enjoy stable cash flows and lower financing risks, but they are still vulnerable to concentration risks. Oligopolistic industries demonstrate relatively efficient liquidity management and at the same time transfer financial pressure to suppliers through strong bargaining power. In contrast, suppliers in competitive markets face the greatest financing pressure due to weak bargaining power, long payment cycles and large fluctuations in profitability. This paper holds that market structure indirectly affects supply chain finance risks by influencing the stability of a company's cash flow, its bargaining power and its dependence on suppliers, thereby providing a more comprehensive analytical framework for understanding the heterogeneous financing risks among different industries.