Research On Working Capital Management Model Based On Value Chain

A successful management mode of working capital has direct influence on thepromotion of enterprise value and achieving of profit, which obviously shows thatworking capital management is an important content of enterprise financialmanagement. With the great development of economic globalization, the changes,with which enterprises are facing, are fundamentally in the competitive environment.Under the globalization tide, How to build the core competitiveness of enterprises toachieve sustainable development are the key po int and the set point of enterprisedevelopment strategy. In recent years, the value chain theory has been widely used inthe daily management of enterprises, which bridges the boundary among theenterprises, improves the speed of chain reaction in the market, and further to realizethe maximization of the whole value chain. Therefore, it will be a great innovationand breakthrough to apply the value chain theory to the working capital managementof enterprises by combining with the concepts and methods of supply chainmanagement, channel management and customer relationship management, so as toimprove the value-added ability of logistics, capital flow and information flow.As a typical manufacturing industry, the healthy development of food, beverageindustry relates a lot to the basic livelihood construction. However, with the rapidimprovement of people’s living standards, the consumer demand of quality, safety aswell as diversification of food and beverage industry is becoming considerably high,which is the severe challenge for the food and beverage industry. How to improve theefficiency of resource allocation, under the condition of buyer dominated marketenvironment, are the most difficult and highly important business activities toimprove working capital management performance. Food, beverage industry,including three channels of procurement, production and marketing, are impacted alot by the product terminal market, therefore it is believed that the discussion onworking capital management of food and beverage industry has some profoundsignificance and feasibility, due to their frequent circulation of daily working capital.Adjusting to the development of the world, food and beverage industry, whoseproduction activities is composed by procurement, production and marketing, need toimprove the overall core competitiveness of value chain by collaborating the upstream and downstream enterprises, and further to improve the working capital managementlevel, with the aim to laying the cornerstone for sustainable development of the foodand beverage industry.This paper aims to study the working capital management model of food andbeverage industry, by the way of combining the theory of value chain and workingcapital management together. The first part introduces the researching background,purpose and significance of working capital management model lying in value chain,in the food and beverage industry; and establishes the preliminary framework of thethesis through basic structure of essay, and research methods. The second part aims toprovide the theoretical basis and build the research angle for the following study, withthe method of combining the working capital management theory, supply chainmanagement theory, channel theory and customer manage ment theory to research andsummarize domestic and foreign capital management and value chain. The third partand the fourth part is the main body of the essay. The third part analyzes the presentsituation and influencing factors of working capital manage ment in food and beverageindustry, from the perspective of the supply chain management, channels andcustomer relationship. Combining with the current status of working capitalmanagement in food and beverage industry, the fourth part analysis basic thought ofeach model, the main flow of business and working capital management effect, usingthe value-added elements of the value chain as a carrier, to establish the workingcapital management mode of logistics flow, information flow and capital flow, whichechoes back to the main topic—to improve the working capital managementefficiency of the whole value chain. In the part of cases analysis, Tsingtao beer co.,LTD is selected as the typical company of beverage industry, to analyze the currentstatus of working capital management. At last, the essay discusses the Tsingtao Beerworking capital management model based on value chain, from the feasibility oflogistics, information flow and capital flow; and analyzes the shortcomings andfeasibility of the present model, after that the essay supplements the deficiency ofTsingtao beer accordingly, in order to improve the performance of working capitalmanagement based on value chain, and enhance the value chain of value-added.This paper breaks through the traditional concept of working capital andmanagement concept; meanwhile it analyzes the status of working capitalmanagement in food and beverage industry. The essay improves the research systemof working capital management by deeply discussing the working capital management model based on value chain, which also has guiding significance for the food andbeverage industry in practice of working capital management area.