Research On Optimization Of Financing Mode For Small And Medium Enterprises Based On Financing Effectiveness

With the development of economy, small and medium enterprises (SMEs) have become a most important part of socialism market economy. Capital is critical for SMEs`s development. Facing strong competition and many financing models, it is important to select a suitable financing model, especially for SMEs without enough capital. A appropriate financing model can help SMEs gain capital and more development opportunity.At present, most of SMEs select equity financing as their financing option. Although most researchers agree with that internal financing is better than external financing, they have not reached an agreement on which is better between debt financing and equity financing. So this paper studys financing options suitable for SMEs, at the point of financing efficiency. The research result shows that it is better for the SEMs to select debt financing, not equity financing.Based on SMEs financing option theory, this paper makes an evaluation on the efficiency of debt financing and equity financing, with the fuzzy comprehensive evaluation method. When defining remark collection, this paper sets up five-level remark collection, which is more reasonable and accurate than two-level remark collection. With analytic hierarchy process (AHP), the paper defines indicator weight and build up membership grade matrix describing how the factors affect financing efficiency. The final evaluation result shows that as to SMEs, debt financing model is higher than equity financing model.In order to confirm the reliability of evaluation result, this paper carries out empirical research. This paper makes 216 SMEs, all of which belong to the board market of small and medium-sized enterprises, as object of study. And the paper sets up multivariable linear regression model, makes descriptive statistical analysis and regression analysis on overall sample and industry sample. The result shows that both debt financing and equity financing have great adverse effect on capital gain ability, but debt financing has smaller adverse effect. This indicates that debt financing has an advantage over equity financing. And the empirical research result also confirms the reliability of evaluation above.Finally, based on the study result, this paper gives some useful advice to help SMEs select suitable financing option, at the point of government, society and enterprise respectively.