The impact of servitization on trade credit in manufacturing firms: a signaling theory perspective

Weijiao Wang, Shanshan Chen, Jinan Shao, Junfei Chu, Zhe Yuan

Research output: Journal PublicationArticlepeer-review

3 Citations (Scopus)

Abstract

Purpose: The aim of this study is to empirically test the link between servitization and trade credit in manufacturing firms as well as the boundary conditions of this link. Design/methodology/approach: Using a unique dataset of 4,974 observations covering 838 manufacturing firms publicly listed in the United States during 1990–2020, this study examines the impact of servitization on trade credit and the moderating impacts of financial slack and service relatedness based on fixed-effect regression models. Findings: The authors find that servitization shows a U-shaped relationship with trade credit. Besides, financial slack negatively moderates this U-shaped relationship whereas service relatedness has no significant impact on this relationship. Originality/value: This paper is the first to empirically verify the influence of servitization on trade credit in manufacturing firms based on longitudinal secondary data and signaling theory. The research findings can provide several important theoretical and managerial implications for scholars and practitioners in operations management.

Original languageEnglish
Pages (from-to)373-398
Number of pages26
JournalInternational Journal of Operations and Production Management
Volume43
Issue number2
DOIs
Publication statusPublished - 7 Feb 2023

Keywords

  • Financial slack
  • Service relatedness
  • Servitization
  • Signaling theory
  • Trade credit

ASJC Scopus subject areas

  • General Decision Sciences
  • Strategy and Management
  • Management of Technology and Innovation

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