Innovation has always been a key driver of economic development, particularly in the context of small and medium-sized enterprises (SMEs). Despite their significant contributions, many of these enterprises currently lack strong research and development capabilities, face challenges in innovation investment, and struggle to produce high-quality innovative results. To address these issues and overcome funding obstacles, many SMEs are turning to supply chain finance (SCF) as a supplementary financing method. This study utilizes stata16 and fixed effects models to analyze the impact and mechanism of SCF on enterprise innovation performance (EIP), focusing on companies listed on the SME Board and GEM in Shenzhen, China from 2011 to 2020. The findings reveal that SCF can effectively enhance enterprise innovation output, facilitating the conversion of resources into high-quality innovation results. Additionally, the study demonstrates that supply chain concentration acts as a mediator between SCF and EIP. Moreover, SCF is found to significantly boost EIP with low supplier concentrations and high customer concentrations. This suggests that SMEs encounter obstacles to innovation from suppliers and customers, and SCF may not fully address the challenges posed by these relationships. Overall, this research offers new empirical insights into the economic implications of companies adopting SCF, providing valuable guidance for enterprises in optimizing innovation decisions and for the government in enhancing supplier and customer information disclosure systems.

1. Abbasi, W. A., Wang, Z., & Alsakarneh, A. (2018). Overcoming SMEs financing and supply chain obstacles by introducing supply chain finance. HOLISTICA—Journal of Business and Public Administration, 9(1), 7–22. https://intapi.sciendo.com/pdf/10.1515/hjbpa-2018-0001
2. Bai, H., Huang, L., & Wang, Z. (2024). Supply chain financing, digital financial inclusion and enterprise innovation: Evidence from China. International Review of Financial Analysis, 91, 103044. https://doi.org/10.1016/j.irfa.2023.103044
3. Basole, R. C., Bellamy, M. A., & Park, H. (2016). Visualization of Innovation in Global Supply Chain Networks. Decision Sciences, 48(2), 288–306. https://doi.org/10.1111/deci.12213
4. Beck, T. H. (2007). Financing constraints of SMEs in developing countries: Evidence, determinants and solutions. Financing innovation-oriented businesses to promote entrepreneurship. Available online: https://pure.uvt.nl/ws/portalfiles/portal/1107677/Financing_Constraints_of_SMEs.pdf (1 January 2007).
5. Berman, S. J., & Hagan, J. (2006). How technology-driven business strategy can spur innovation and growth. Strategy and Leadership, 34(2), 28–34. https://doi.org/10.1108/10878570610700848
6. Bogers, M., Chesbrough, H., & Moedas, C. (2018). Open innovation: Research, practices, and policies. California management review, 60(2), 5–16. https://doi.org/10.1177/0008125617745086
7. Bozintan, I. C. (2022). SMEs Finacing-An Overview of direct Financing on capital market Vs. Financial Institutions. The Annals of the University of Oradea. Economic Sciences, 31, 92–102. https://doi.org/10.47535/1991AUOES31(2)009
8. Caldeira, M. M., & Ward, J. M. (2003). Using resource-based theory to interpret the successful adoption and use of information systems and technology in manufacturing small and medium-sized enterprises. European Journal of Information Systems, 12(2), 127–141. https://doi.org/10.1057/palgrave.ejis.3000454
9. Chang, W., & Taylor, S. A. (2016). The effectiveness of customer participation in new product development: A meta-analysis. Journal of Marketing, 80(1), 47–64. https://doi.org/10.1509/jm.14.0057
10. Chen, H., Zhong, T., & Lee, J. Y. (2020). Capacity Reduction Pressure, Financing Constraints, and Enterprise Sustainable Innovation Investment: Evidence from Chinese Manufacturing Companies. Sustainability, 12(24), 10472. https://doi.org/10.3390/su122410472
11. Chen, M., Tang, X., Liu, H., et al. (2023). The impact of supply chain concentration on integration and business performance. International Journal of Production Economics, 257, 108781. https://doi.org/10.1016/j.ijpe.2023.108781
12. Chen, X., Liu, C., & Li, S. (2019). The role of supply chain finance in improving the competitive advantage of online retailing enterprises. Electronic Commerce Research and Applications, 33, 100821. https://doi.org/10.1016/j.elerap.2018.100821
13. Clarysse, B., Wright, M., Bruneel, J., et al. (2014). Creating value in ecosystems: Crossing the chasm between knowledge and business ecosystems. Research Policy, 43(7), 1164–1176. https://doi.org/10.1016/j.respol.2014.04.014
14. De Jong, M., Marston, N., & Roth, E. (2015). The eight essentials of innovation. McKinsey Quarterly, 2, 1–12.
15. De Rassenfosse, G., Dernis, H., Guellec, D., et al. (2013). The worldwide count of priority patents: A new indicator of inventive activity. Research Policy, 42(3), 720–737. https://doi.org/10.1016/j.respol.2012.11.002
16. Dedehayir, O., Mäkinen, S. J., & Roland Ortt, J. (2018). Roles during innovation ecosystem genesis: A literature review. Technological Forecasting and Social Change, 136, 18–29. https://doi.org/10.1016/j.techfore.2016.11.028
17. Deng, L., Lv, Y., Liu, Y., et al. (2021). Impact of Fintech on Bank Risk-Taking: Evidence from China. Risks, 9(5), 99. https://doi.org/10.3390/risks9050099
18. Dewangan, V., & Godse, M. (2014). Towards a holistic enterprise innovation performance measurement system. Technovation, 34(9), 536–545. https://doi.org/10.1016/j.technovation.2014.04.002
19. Dhaliwal, D., Judd, J. S., Serfling, M., & Shaikh, S. (2016). Customer concentration risk and the cost of equity capital. Journal of Accounting and Economics, 61(1), 23–48. https://doi.org/10.1016/j.jacceco.2015.03.005
20. Edler, J. (2010). Demand oriented innovation policy. The Co-Evolution of Innovation Policy-Innovation Policy Dynamics, Systems and Governance, Cheltenham. https://doi.org/10.4337/9781849804424.00020
21. Edquist, C., Zabala-Iturriagagoitia, J. M., Barbero, J., et al. (2018). On the meaning of innovation performance: Is the synthetic indicator of the Innovation Union Scoreboard flawed? Research Evaluation, 27(3), 196–211. https://doi.org/10.1093/reseval/rvy011
22. Elliot, V. H., De Goeij, C., Gelsomino, L. M., & Woxenius, J. (2020). Supply chain finance is not for everyone. International Journal of Physical Distribution & Logistics Management, 50(9/10), 775–807. https://doi.org/10.1108/IJPDLM-11-2019-0331
23. Fan, J., & Zhou, Y. (2023). Empirical Analysis of Financing Efficiency and Constraints Effects on the Green Innovation of Green Supply Chain Enterprises: A Case Study of China. Sustainability, 15(6), 5300. https://doi.org/10.3390/su15065300
24. Fitzgerald, L., Johnston, R., Brignall, S., et al. (1991). Performance Measurement in Service Business. CIMA Publishing.
25. Fudickar, R., & Hottenrott, H. (2018). Public research and the innovation performance of new technology based firms. The Journal of Technology Transfer, 44(2), 326–358. https://doi.org/10.1007/s10961-018-9695-z
26. Gronum, S., Verreynne, M.-L., & Kastelle, T. (2012). The Role of Networks in Small and Medium-Sized Enterprise Innovation and Firm Performance. Journal of Small Business Management, 50(2), 257–282. https://doi.org/10.1111/j.1540-627x.2012.00353.x
27. Guo, J., Jia, F., Yan, F., et al. (2023). E-commerce supply chain finance for SMEs: the role of green innovation. International Journal of Logistics Research and Applications, 1–20. https://doi.org/10.1080/13675567.2023.2167959
28. Hall, B. H. (2002). The financing of research and development. Oxford review of economic policy, 18(1), 35–51. https://doi.org/10.1093/oxrep/18.1.35
29. Haq, M. Z. U., Gu, M., & Huo, B. (2021). Enhancing supply chain learning and innovation performance through human resource management. Journal of Business & Industrial Marketing, 36(3), 552–568. https://doi.org/10.1108/JBIM-12-2019-0534
30. Hofmann, E. (2014). Interorganizational Operations Management. Springer Fachmedien Wiesbaden. https://doi.org/10.1007/978-3-658-03815-1
31. Hofmann, E. (2005). Supply chain finance: some conceptual insights. Beiträge Zu Beschaffung Und Logistik, 16(1), 203–214. https://doi.org/10.1007/978-3-658-03815-1
32. Hofmann, E., & Belin, O. (2011). Supply Chain Finance Solutions. In: SpringerBriefs in Business. Springer Berlin Heidelberg. https://doi.org/10.1007/978-3-642-17566-4
33. Hottenrott, H., & Lopes‐Bento, C. (2016). R&D Partnerships and Innovation Performance: Can There Be too Much of a Good Thing? Journal of Product Innovation Management, 33(6), 773–794. https://doi.org/10.1111/jpim.12311
34. Hou, Y. H., Li, S. S., Hao, M., & Rao, W. Z. (2021). Influence of market green pressure on the green innovation behavior of knowledge-based enterprises. China Popul. Resour. Environ, 31(1), 100–110.
35. Huang, H., & Sutunyarak, C. (2024). An Empirical Study On The Impact Of Supply Chain Finance On Enterprise Innovation Performance Based On The Mediating Effect Of Supply Chain Concentration. Kurdish Studies, 12(4), 356–388. https://doi.org/10.53555/ks.v12i4.1886
36. Jaca, C., Zárraga-Rodriguez, M., Viles, E., et al. (2016). Exploring Information Capability and its Role in Innovation. Journal of Globalization, Competitiveness and Governability, 10(1). https://doi.org/10.3232/gcg.2016.v10.n1.03
37. Jose, M. L., Lancaster, C., & Stevens, J. L. (1996). Corporate returns and cash conversion cycles. Journal of Economics and Finance, 20(1), 33–46. https://doi.org/10.1007/bf02920497
38. Kaplan, R. S., & Norton, D. P. (1992). The balanced scorecard: measures that drive performance. Harvard Bus. Rev. 70 (1), 71–79.
39. Keegan, D. P., Eiler, R. G., & Jones, C. R. (1989). Are your performance measures obsolete? Strategic Finance, 70(12), 45–50.
40. Khan, S. A., Liang, Y., & Shahzad, S. (2015). The effect of buyer-supplier partnership and information integration on supply chain performance: An experience from Chinese manufacturing industry. International Journal of Supply Chain Management, 4(2), 20–34.
41. Kirchberger, M. A., & Pohl, L. (2016). Technology commercialization: a literature review of success factors and antecedents across different contexts. The Journal of Technology Transfer, 41(5), 1077–1112. https://doi.org/10.1007/s10961-016-9486-3
42. Köhler, C., Sofka, W., & Grimpe, C. (2012). Selective search, sectoral patterns, and the impact on product innovation performance. Research Policy, 41(8), 1344–1356. https://doi.org/10.1016/j.respol.2012.03.020
43. Krolikowski, M., & Yuan, X. (2017). Friend or foe: Customer-supplier relationships and innovation. Journal of Business Research, 78, 53–68. https://doi.org/10.1016/j.jbusres.2017.04.023
44. Kwon, S.-W., Rondi, E., Levin, D. Z., et al. (2020). Network Brokerage: An Integrative Review and Future Research Agenda. Journal of Management, 46(6), 1092–1120. https://doi.org/10.1177/0149206320914694
45. Lanier Jr, D., Wempe, W. F., & Zacharia, Z. G. (2009). Concentrated supply chain membership and financial performance: Chain‐ and firm‐level perspectives. Journal of Operations Management, 28(1), 1–16. https://doi.org/10.1016/j.jom.2009.06.002
46. Laursen, K., & Salter, A. (2006). Open for innovation: the role of openness in explaining innovation performance among UK manufacturing firms. Strategic management journal, 27(2), 131–150. https://doi.org/10.1002/smj.507
47. Lee, N., Sameen, H., & Cowling, M. (2015). Access to finance for innovative SMEs since the financial crisis. Research policy, 44(2), 370–380. https://doi.org/10.1016/j.respol.2014.09.008
48. Li, X. J., & Hu, W. L. (2017). Research on Supply Chain Financial Model and Practice Based on B2B Platform. Economics Manage., 31(5), 35–38.
49. Liang, X., Zhao, X., Wang, M., et al. (2018). Small and Medium-Sized Enterprises Sustainable Supply Chain Financing Decision Based on Triple Bottom Line Theory. Sustainability, 10(11), 4242. https://doi.org/10.3390/su10114242
50. Liu, W., Zhang, J., & Wang, S. (2021). Factors influencing the smart supply chain innovation performance of commodity distribution enterprises: An investigation from China. Industrial Management & Data Systems, 121(10), 2073–2099. https://doi.org/10.1108/IMDS-12-2020-0753
51. Lu, C., Yu, B., Zhang, J., et al. (2020). Effects of open innovation strategies on innovation performance of SMEs: Evidence from China. Chinese Management Studies, 15(1), 24–43. https://doi.org/10.1108/cms-01-2020-0009
52. Lynch, R. L., Cross, K. F. (1991). Measure Up—The Essential Guide to Measuring Business Performance. Mandarin.
53. Ma, H. L., Wang, Z. X., & Chan, F. T. (2020). How important are supply chain collaborative factors in supply chain finance? A view of financial service providers in China. International Journal of Production Economics, 219, 341–346. https://doi.org/10.1016/j.ijpe.2019.07.002
54. Ma, J., & Han, L. (2021). Environmental uncertainty, customer concentration and debt financing capacity. In LISS 2020: Proceedings of the 10th International Conference on Logistics, Informatics and Service Sciences. Springer Singapore. https://doi.org/10.1007/978-981-33-4359-7_23
55. Manuela, P., Cristina, B., & Molina-Morales, F. X. (2021). I need you, but do I love you? Strong ties and innovation in supplier-customer relations. European Management Journal, 39(6), 790–801. https://doi.org/10.1016/j.emj.2021.01.009
56. Medhi, P. K., Jain, P., & Jain, T. (2019). Effects of information sources for new customers and suppliers on the immediate innovation output of firms. European Journal of Innovation Management, 22(4), 660–680. https://doi.org/10.1108/ejim-09-2018-0202
57. Morgan, T., Obal, M., & Anokhin, S. (2018). Customer participation and new product performance: Towards the understanding of the mechanisms and key contingencies. Research Policy, 47(2), 498–510. https://doi.org/10.1016/j.respol.2018.01.005
58. Narasimhan, R., & Narayanan, S. (2013). Perspectives on Supply Network–Enabled Innovations. Journal of Supply Chain Management, 49(4), 27–42. https://doi.org/10.1111/jscm.12026
59. Neely, A. D., Adams, C., & Kennerley, M. (2002). The performance prism: The scorecard for measuring and managing business success. London: Prentice Hall Financial Times, 159–160.
60. Onofrei, G., Nguyen, H. M., Zhang, M., et al. (2020). Building supply chain relational capital: The impact of supplier and customer leveraging on innovation performance. Business Strategy and the Environment, 29(8), 3422–3434. https://doi.org/10.1002/bse.2586
61. Pan, X., Guo, S., & Chu, J. (2021). P2P supply chain financing, R&D investment and companies’ innovation efficiency. Journal of Enterprise Information Management, 34(1), 578–597. https://doi.org/10.1108/jeim-07-2020-0258
62. Pan, J., Yu, M., Liu, J., & Fan, R. (2020). Customer concentration and corporate innovation: Evidence from China. The North American Journal of Economics and Finance, 54, 101284. https://doi.org/10.1016/j.najef.2020.101284
63. Ren, S., Eisingerich, A. B., & Tsai, H. T. (2015). How do marketing, research and development capabilities, and degree of internationalization synergistically affect the innovation performance of small and medium-sized enterprises (SMEs)? A panel data study of Chinese SMEs. International Business Review, 24(4), 642–651. https://doi.org/10.1016/j.ibusrev.2014.11.006
64. Rosenkopf, L., & Nerkar, A. (2001). Beyond local search: boundary‐spanning, exploration, and impact in the optical disk industry. Strategic Management Journal, 22(4), 287–306. https://doi.org/10.1002/smj.160
65. Rubera, G., Chandrasekaran, D., & Ordanini, A. (2016). Open innovation, product portfolio innovativeness and firm performance: the dual role of new product development capabilities. Journal of the Academy of Marketing Science, 44, 166–184. https://doi.org/10.1007/s11747-014-0423-4
66. Ruiqi, W., Wang, F., Xu, L., & Yuan, C. (2017). R&D expenditures, ultimate ownership and future performance: Evidence from China. Journal of Business Research, 71, 47–54. https://doi.org/10.1016/j.jbusres.2016.10.018
67. Salavou, H., & Avlonitis, G. (2008). Product innovativeness and performance: a focus on SMEs. Management Decision, 46(7), 969–985. https://doi.org/10.1108/00251740810890168
68. Sarkar, B., Seok, H., Jana, T. K., & Dey, B. K. (2023). Is the system reliability profitable for retailing and consumer service of a dynamical system under cross-price elasticity of demand? Journal of Retailing and Consumer Services, 75, 103439. https://doi.org/10.1016/j.jretconser.2023.103439
69. Schiele, H., Ellis, S. C., Eßig, M., et al. (2015). Managing supplier satisfaction: Social capital and resource dependence frameworks. Australasian Marketing Journal, 23(2), 132–138. https://doi.org/10.1016/j.ausmj.2015.04.008
70. Schoenherr, T. (2018). Leveraging suppliers for product innovation performance: the moderating role of intellectual capital. Transportation Journal, 57(4), 365–398. https://doi.org/10.5325/transportationj.57.4.0365
71. Sdiri, H., Ayadi, M., & Elj, M. (2010). Innovation and Performance: an Empirical Study of Tunisian Service Firms. Journal of Innovation and Business Best Practices, 1–9. https://doi.org/10.5171/2010.492128
72. Söderberg, L., & Bengtsson, L. (2010). Supply chain management maturity and performance in SMEs. Operations Management Research, 3, 90–97. https://doi.org/10.1007/s12063-010-0030-6
73. Song, H., Yang, X., & Yu, K. (2020). How do supply chain network and SMEs’ operational capabilities enhance working capital financing? An integrative signaling view. International Journal of Production Economics, 220, 107447. https://doi.org/10.1016/j.ijpe.2019.07.020
74. Statsenko, L., & Corral de Zubielqui, G. (2020). Customer collaboration, service firms’ diversification and innovation performance. Industrial Marketing Management, 85, 180–196. https://doi.org/10.1016/j.indmarman.2019.09.013
75. Sun, R., Ho, K.-C., Gu, Y., et al. (2019). Asymmetric Cost Behavior and Investment in R&D: Evidence from China’s Manufacturing Listed Companies. Sustainability, 11(6), 1785. https://doi.org/10.3390/su11061785
76. Tang, C. S., Zimmerman, J. D., & Nelson, J. I. (2009). Managing new product development and supply chain risks: The Boeing 787 case. In Supply Chain Forum: An International Journal, Taylor & Francis, 10(2), 74–86. https://doi.org/10.1080/16258312.2009.11517219
77. Walters, D., & Rainbird, M. (2004). The demand chain as an integral component of the value chain. Journal of consumer marketing, 21(7), 465–475.https://doi.org/10.1108/07363760410568680
78. Wang, C., & Hu, Q. (2020). Knowledge sharing in supply chain networks: Effects of collaborative innovation activities and capability on innovation performance. Technovation, 94–95, 102010. https://doi.org/10.1016/j.technovation.2017.12.002
79. Wang, W., Yin, X., Coles, R., et al. (2024). More knowledge, better innovation? Role of knowledge breadth and depth. Management Decision, 62(5), 1576–1597. https://doi.org/10.1108/md-06-2023-0910
80. Wei, S., Deng, C., Liu, H., et al. (2024). Supply chain concentration and financial performance: the moderating roles of marketing and operational capabilities. Journal of Enterprise Information Management. https://doi.org/10.1108/jeim-07-2023-0356
81. Wen, Z., & Ye, B. (2014). Analyses of Mediating Effects: The Development of Methods and Models. Advances in Psychological Science, 22(5), 731. https://doi.org/10.3724/sp.j.1042.2014.00731
82. West, J., & Bogers, M. (2014). Leveraging external sources of innovation: A review of research on open innovation. Journal of product innovation management, 31(4), 814–831. https://doi.org/10.1111/jpim.12125
83. Wu, Y., & Huang, S. (2022). The effects of digital finance and financial constraint on financial performance: Firm-level evidence from China’s new energy enterprises. Energy Economics, 112, 106158. https://doi.org/10.1016/j.eneco.2022.106158
84. Xu, X., & Xuan, C. (2021). A study on the motivation of financialization in emerging markets: The case of Chinese nonfinancial corporations. International Review of Economics & Finance, 72, 606–623. https://doi.org/10.1016/j.iref.2020.12.026
85. Yang, H., Chen, W., & Hao, Y. F. (2020). Supply chain partnership, inter-organizational knowledge trading and enterprise innovation performance: The theoretical and empirical research in project-based supply chain. Soft Computing, 24(9), 6433–6444. https://doi.org/10.1007/s00500-019-04548-5
86. Yang, Y., Chu, X., Pang, R., et al. (2021). Identifying and predicting the credit risk of small and medium-sized enterprises in sustainable supply chain finance: evidence from China. Sustainability, 13(10), 5714. https://doi.org/10.3390/su13105714
87. Yang, Z. (2017). Customer concentration, relationship, and debt contracting. Journal of Applied Accounting Research, 18(2), 185–207. https://doi.org/10.1108/jaar-04-2016-0041
88. Yao, L., & Yang, X. (2022). Can digital finance boost SME innovation by easing financing constraints?: Evidence from Chinese GEM-listed companies. PLoS One, 17(3), e0264647. https://doi.org/10.1371/journal.pone.0264647
89. Zhao, X., Tan, Z., & Hou, D. S. (2023). Can military executives become good business partners? An analysis from a vendor-customer perspective. International Review of Financial Analysis, 90, 102860. https://doi.org/10.1016/j.irfa.2023.102860
90. Zhao, Yang and Wang, Ning, Research on Authors’ Co-authorship Network in Supply Chain Finance in China Based on Social Network Analysis (2021). Available online: https://aisel.aisnet.org/whiceb2021/65 (15 June 2023).