Sustainability Strategies of Equipment Introduction and Overcapacity Risk Sharing in Mask Emergency Supply Chains during Pandemics

Haibo Chen, Zongjun Wang and Xuesong Yu
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Haibo Chen: School of Management, Huazhong University of Science and Technology, Wuhan 430074, China
Zongjun Wang: School of Management, Huazhong University of Science and Technology, Wuhan 430074, China
Xuesong Yu: School of Economics and Management, Hubei Polytechnic University, Huangshi 435003, China

Sustainability, 2021, vol. 13, issue 18, 1-17

Abstract: The sustainability of the mask emergency supply chain faces two problems during the current COVID-19 pandemic. First, mask manufacturers are mainly small and mid-size enterprises, resulting in a lack of funds and credit lines for the introduction of equipment. Second, the periodicity and uncertainty of pandemics create overcapacity risk for the mask emergency supply chain. To solve these problems, this study incorporates financial leasing institutions and the government into the mask emergency supply chain. Based on a questionnaire survey of practitioners of financial leasing institutions, the relationship between mask manufacturers, financial leasing institutions, and the government in the mask supply chain is analyzed through a game model, and the behavior of mask manufacturers to reduce the scale of mask production after the occurrence of overcapacity is investigated using the cusp catastrophe theory. We find that in the case of masks’ overcapacity, mask manufacturers tend to continue production. Finally, we propose that financial leasing institutions should lease mask production equipment to mask manufacturers under the guarantee of the government and develop a mechanism for the three parties to jointly share the risk of mask overcapacity, aiming at ensuring the sustainable manufacturing of masks during the pandemic.

Keywords: mask emergency supply chain; risk of mask overcapacity; financial leasing; mask production equipment (search for similar items in EconPapers)
JEL-codes: O13 Q Q0 Q2 Q3 Q5 Q56 (search for similar items in EconPapers)
Date: 2021
References: View references in EconPapers View complete reference list from CitEc
Citations: View citations in EconPapers (4)

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