Research On The Capital Structure Of Catering Enterprises From The Angle Of Life Cycle Theory

It has been downturn about Chinese economic in recent years, especially cateringindustry. The growth rate of the catering industry has into a slump in the21century except theSARS period. It is caused by many aspects. On the one hand, the catering industry can beseen in everywhere and the market is more and more competitive leading to the small profit.On the other hand, the cost of raw materials and labor has sharply rising. And the politicalsituation also leads the catering enterprises to lost many customers. To some extent, this isalso the drop in sales of catering industry. It has become an important issue that the cateringcompanies are how to adjust the capital structure to adapt to the current economic situation.Every business goes through a process of its production, development, decline and evenextinction. Only by fully aware of the stage of their own, can they have a better chance to suitthe capital structure itself. The most enterprises’ capital structure is not reasonable at present.The capital structure of listed companies in our country is deviated from the optimal sequenceof international finance theory. Preferred equity financing of listed companies in our country,the second is debt financing, and internal financing will finally choose. Enterprise are morepreference short-term borrowing in the debt financing, rather than debt financing.Capital structure is different in a wide range of industries. The asset-liability ratio ishigher such as financial institutions, the real estate industry, the construction enterprises, theinformation technology. This has lower debt ratios such as the dissemination of cultureindustry, social services, agriculture, forestry, animal husbandry and fisheries. This articlechooses the catering industry of the low asset-liability ratio as the research object. This paperintroduces the capital structure characteristics of the stages of enterprise life cycle. It studiesthe XQ company and introduces the enterprise capital structure from2010to2012. Accordingto the current business conditions in2013warned enterprises to take into account in theprocess of financing the capital structure of the elastic. It can ensure the transition from the current operating conditions to suit their own capital structure, so as to achieve the optimalstructure.This paper is divided into five parts: the first part is the introduction; the second partintroduces the theory of capital structure and life-cycle theory of enterprises; the third sectiondescribes the status of the capital structure of Chinese catering industry currently; the fourthpart mainly takes the XQ company as an example to introduce the situation of the capitalstructure it, and warned the companies should pay attention to the capital structure of theelastic enterprise; the fifth part is the conclusion. The structure is different in the differentstages of the life cycle of enterprises. The article described the capital structure for each lifecycle stage. It in different period of development for the enterprise should be how to adjusttheir capital structure to promote the healthy development of the enterprise provides the help.