Study On Working Capital Management Of Dairy Industry Based On The Theory Of Channels

Working capital is the most liquid part of assets in a company.It's seen as the blood of the company.Fluctuant markets and post-financial crisis have led many companies to recognize the importance of working capital management.The working capital management is also becoming the focus of enterprise managers.Working capital management is closely related to the operating costs of enterprises.A company with good working capital management will reduce its operating costs.On the contrary,if a company has poor working capital management,it will take up a lot of working capital.Operating costs will also increase and profitability will be greatly affected.The working capital management has also attracted the attention of management.Relevant scholars have formed a series of theories on working capital management.Among them,and the traditional theory of working capital management based on elements is mainly research on individual working capital projects.The relationship between working capital management and enterprise business process is not fully considered.It has many flaws.Subsequently,the research on working capital management has been deepening and gradually combines with some advanced theories,such as channel management,supply chain management and value chain management.Wang Zhuquan,professor of ocean university of China,proposed working capital management theory based on channel.He combines working capital management with the business process of an enterprise.The overall working capital of the enterprise is divided into operating capital and financial capital.He divided the business activities into purchasing channels,production channels,sales channels and designed a new performance evaluation system of working capital.management.The current rapid development of China's dairy industry are also facing the double pressure from internal and external environment of the industry.The traditional working capital management mode based on elements of modern dairy processing enterprises has been unable to meet the management needs.The shortage of funds has seriously affected the production and development of enterprises.This paper applies the working capital management theory based on channels to dairy processing enterprises.It analyzes the working capital management of each channels.It aims to improve the working capital management level and improve the profitability as a whole.This study first summarizes the research of scholars.Domestic and foreign researches mainly focus on three aspects: working capital management connotation,working capital management strategy and working capital management performance evaluation method.Secondly,this paper analyzes the traditional working capital management theory,as well as the working capital management theory based on channel.Third,according to the characteristics and basic situation of dairy enterprises,this paper analyzes the problems existing in the working capital management in China's dairy industry and the key factors,that have a significant impact on the working capital management in each business sprocess.Finally,it takes A companyas anexample,analyzing the deficiency of the current working capital management of the company and puting forward some suggestions for improving the level of working capital management.It improves the management level of A company and guarantees its survival and development.Chinese dairy enterprises can refer to the management practice of A company and promote the working capital management system and improve the working capital management level.