An Empirical Research On The Relationship Among Growth,Market Position And Corporate Performance

As the saying goes,"Men fear into the wrong industry,women fear to marry the wrong men." The choice of the industry and the enterprise is very important.As Potter said,the primary factor that determines the profitability of enterprises is the attractiveness of the industry,and the industry's position also affects the profitability of enterprises.After more than 30 years of reform and opening up,China's economy has entered a new stage of structural adjustment,transformation and upgrading.The central economic work conference held in December 2015 treats the strategy of cutting overcapacity,de-stocking,deleveraging,reducing corporate costs and shoring up weak spots as an important task of deepening the supply-side structural reform,which points out the direction of structural adjustment and transformation and upgrading of enterprises.Is Potter's industry competition strategy and enterprise competition strategy suitable for the change or adjust of Chinese enterprises in new era?How to apply Potter's industry competition strategy and enterprise competition strategy to Chinese enterprises' management practice?To solve these problems not only need to carry out in-depth theoretical exploration,but also need to carry out rigorous empirical research.So this paper takes the sample of listed companies in 8 industries of China from 2004 to 2015,and analyzes the relationship among growth,market position and corporate performance.The statistical analysis showed that:(1)(good industry growth,high market position)group has the best financial performance,followed by(bad industry growth,high market position)group,and their financial performance are all higher than industry average;While(good industry growth,low market position)group and(bad industry growth,low market position)has the worst financial performance,and their financial performance are all lower than industry average.This shows that industry growth and market position will have an impact on financial performance.(2)(bad industry growth,low market position)has the best market performance,followed by(bad industry growth,high market position)group,and their market performance are all higher than sample mean;while(good industry growth,high market position)and(good industry growth,low market position)has the worst market performance,and their market performance are all less than the sample mean.It shows that enterprises with poor industry growth and low market position have yet a better market performance.The empirical analysis showed that:(1)Industry growth has no significant impact on financial performance.(2)Enterprises growth has a significant positive impact on financial performance.(3)Market position has no significant impact on financial performance.(4)The cross terms of industry growth and market position has a relatively significant positive impact on financial performance.(5)The cross terms of enterprises growth and market position has no significant impact on financial performance.(6)Industry growth has a relatively negative significant on market performance.(7)Enterprises growth has a significant positive impact on market performance.(8)Market position has no significant impact on market performance.(9)The cross terms of Industry growth and market position has a relatively significant positive impact on market performance.(10)The cross terms of enterprises growth and market position has no significant impact on market performance.From the above findings,we can get the following enlightenment:First,for the enterprise,rapid growth is the hard truth,it can not only improve financial performance,but also improve market performance.Second,the market position has no significant impact on financial performance and market performance,which means that the status of the industry is not the most important,the key is to grow rapidly.Third,the cross terms of industry growth and market position have a significant positive impact on both financial performance and market performance.This means that the relationship between industry growth and market position are complementary rather than substitute.In high growth industries,enterprises should pursuit a higher market position;in the low growth industry,market position is allowed and rapid growth is more important.Fourth,enterprises with poor industry growth and low market position have yet a better market performance,this may be attributed to the lack of efficiency in China's capital market and the lack of rational investors.