Research On The Working Capital Management Of Commercial Real Estate Project Based On The Channel Management

In the joint efforts of the continuous readjustment of housing real estate as well asthe growing demand for commercial real estate in China’s urbanization process,China’s commercial real estate shows a trend of rapid growth since2006. At the endof2011, the construction scale of China’s commercial real estate is larger than manydeveloped countries. Too fast pace of development causes a lot of problems in theprocess of commercial real estate development and operation, of which the mostprominent is the lack of sufficient attention to the fund management problems. Byanalyzing actual cases of most company’s failure in commercial real estate, the mainreason is the turnover problems of their working capitals, in addition to thefundamental weaknesses which are the external macro environment and the lack oftheir core competitiveness. Compared to housing real estate and other real estateforms, commercial real estate shows some salient features including higher capitalintensity, more investment, higher risk coefficient, more links to external supplypoints, and longer time of capital turnover due to the "commercial" factors, whichhighlight the significance of studying commercial real estate working capitalmanagement. This article studies working capital management with commercial realestate as the research object, which is one sort of the real estate.Combined with more external contacts of commercial real estate and some factorsthat influence its operating efficiency of capital turnover, including prepaid accounts,advance receipts and other working capital elements, this paper, based on channeltheory to classify the working capital of the commercial real estate as a starting point,innovatively combines existed working capital element management andconfiguration management with working capital management based on channelmanagement, but the latter is the main line complemented by the former, and analyzestrategies of working capital management of commercial real estate. On this basis, thearticle takes BL properties as an example, which is one of the few listed companies whose core business are commercial real estate, combines with BL real estatedevelopment and management features, takes channel-based theory to classifyworking capital as a starting point, introduces channel management theory, the theoryof supply chain management, customer relationship management theory and otheradvanced concepts, conducts a comprehensive analysis to the working capitalmanagement status and the level of the working capital management in the industry ofBL properties from three aspects, which are the channel relationship management,channel working capital element management and channel structure management, andthen makes reasonable suggestions to further improve its working capital managementwith the performance analysis of BL properties. With the In-depth analysis of the BLproperty cases, I hope China’s commercial real estate developers can pay attention tothe importance of the working capital management in commercial real estate andapply working capital management to the capital management of their commercialreal estate, and finally make some contributions to better understand the workingcapital management status of current commercial real estate and improve the level ofworking capital management of commercial real estate.