Supply chain-oriented mergers and acquisitions and inventory turnover in manufacturing firms: evidence from China

Supply chain mergers and acquisitions (M&A) can alter operations at connected firms outside the transaction. Using panel data on Chinese A-share listed firms from 2010 to 2023, we examine upstream supplier and downstream customer M&A in relation to focal-firm inventory turnover. Resource Dependence Theory and Transaction Cost Economics motivate competing dependence and coordination pathways. Expanded firm and year fixed-effects models show positive associations for both directions. Staggered event studies show positive upstream estimates from the event year, generally larger in the next two years, but no significant downstream event-time estimates. Marginal upstream pre-treatment coefficients limit causal interpretation. Neither concentration interaction supports the proposed negative moderation hypotheses. Supplier concentration forms a significant negative indirect upstream association that offsets the positive direct association; downstream mediation is unsupported. The study complements existing supplier-merger cost research by distinguishing inventory responses, supply-chain direction, first-event timing, and concentration pathways. The results support differentiated partner-transition monitoring, while inventory turnover alone cannot establish improved service, resilience, or overall operational efficiency.