Research On The Product Market Copmetition, Commerical Credit And The Value Of Corporate’s Cash Holdings

At present,China’s economic development has entered the "new normal",the growth of economic is slowing,GDP began to slow from 2012,though the overall momentum of economic development is still positive,but overall,the company’s cash flow back slowly,part of the enterprise funds strand breaks,thus increase and maintain ample cash to become a rational choice of the enterprise,the strategic value of cash holdings has become increasingly prominent.Under the background of the current "emerging + transition" system,combined the product market competition intensified with the reality of the serious loss of corporate credit background,this paper studies the effect of the value of corporate cash holding and the influence mechanism of them,enrich the related research,at the same time,we should pay attention to the strategic effect of cash holding and the accumulation and promotion of commercial credit,it also provides reference and suggestion for the enterprise cash holding decision under different credit rating and product market competition.This paper takes manufacturing companies 2010-2015 date as the study sample,empirical test of the value of corporate cash holdings,further analyzes the impact of product market competition on it and the difference of cash holding value in product market competition under different commercial credit rating.The main conclusion of the article is that the corporate cash holding has a positive value effect,only adequate cash holdings can enable enterprises to face high-quality investment opportunities and seize the initiative to maintain the normal business turnover.Secondly,by studying the relationship between product market competition and corporate cash holding value,this paper finds that both competition within the industry and competition betweenindustries will strengthen the positive value of cash holding effect.Finally,the study also found that the commercial credit rating will affect the product market competition and corporate cash holdings,the higher the commercial credit rating,the positive correlation between the two is weakened.In view of this,I believe that corporate cash holding decision should be considered in the industry competition environment and its own competitive strength as well as commercial credit,cash holding agent cost and value effect between the pros and cons to achieve optimal cash holding decision;Second,enterprises should also strengthen the management of commercial credit,establish a good corporate image,bear the corresponding social responsibility,so that the outside world has a positive evaluation of enterprises in order to rely on the credibility of the funds for lending and financing;Give full play to the commercial credit as additional financing way the important role of financial markets;Government departments should also establish and perfect the credit system,increase the intensity of punishment,improve the illegal cost to make the business environment more harmonious,what’s more,build diversified financing platform for the enterprise.