Faculty of Business Administration
Visiting Scholar Seminar
Major customer reliance and cost sensitivity
Prof. Haomin Zhang
Macao University of Science and Technology
Date: 16 December 2021, Thursday
Time: 15:00 – 16:30
We investigate the impact of major customer reliance on the selling, general, and administrative (SG&A) costs sensitivity in response to sales changes. Based on the analysis of a large sample in the U.S. market, we find that for supplier firms with greater major customer reliance, SG&A costs are less sensitive to both sales increase and decrease. We reach a similar conclusion with the dynamic measures of customer concentration and the duration of the supplier–customer relationship. The findings on SG&A costs can be generalized to other costs, such as total costs and operating costs as well.
Prof. Zhang teaches Financial Accounting, Management Accounting, Corporate Finance and Research Methodology. His research areas are Accounting, Corporate Governance and Supply Chain Studies.