Research On Working Capital Management Of Tsingtao Brewery Co., Ltd. Based On Supply Chain

Working capital is the most flexible component of business fund. It is like the blood aimed at maintaining sustainable working which influences the development of a company greatly. Only if companies pay attention to both strategy and details, can they survive in today’s rapidly changing business era. Therefore experts and business managers are paying growing attention to working capital management and supply chain management. In recent years, study of working capital management from the supply chain perspective is also in the ascendant, and it has developed in the field of both theory and practice.On the basis of research and review of working capital management, supply chain management and the combination of both, this article follows the method of reclassification of working capital proposed by Professor Wang Zhuquan.It takes Tsingtao Brewery Co., Ltd.as the research object whose performance has been very prominent in regardless of market performance or working capital management in our country’s food and beverage industry. Firstly, it introduces the business profiles and current situation of their supply chain management platform. Then it makes detailed analysis of the performance of its working capital management over the past five years, from three aspects of the supply chain respectively, procurement, production and marketing. And it makes some comparison with the industry average.Since Tsingtao Brewery’s working capital management performance has been among the best in the industry these years, this article, through in-depth analysis, sums up its effective strategies which are in favor of the working capital management in the supply chain. It analyses the effects of these strategies in improving its working capital management, so that other companies can learn from it. This article continues to summarize Tsingtao Brewery’s shortcomings which still exist in its working capital management:inadequate utilization of commercial credit in procurement aspect; material inventories occupying too much working capital; uncoordinated operation of information systems;blocked sales of finished products resulted from industry downturn; inadequate ability to control the sales channels.Lastly, it put forward following recommendations on how to further improve its working capital management performance froma supply chain perspective:(1)procurement:make full and effective use of commercial credit, adopt vendor managed inventory model, create harmonious and win-win supplier relationships; (2)production:strengthen independent innovation and promote technological progress, accelerate the running of working capital through the supply chain integration and business process reengineering, strengthen the upstream and downstream channel relationship management; (3)marketing:optimize the implementation of the depth distribution strategy, actively explore e-commerce marketing mode, strengthen the corporate brand buildingThrough the detailed analysis of the Tsingtao case, we can fully understand the role of the supply chain in the process of business operations after combining the theory of supply chain management and working capital management. This provides a more systematic new way of working capital management for us. This new research and management idea will help to improve the current business working capital management system.I hope it could provide a new working capital management concept for other companies, improve the management level of enterprises, and thus promote the economic booming.