Research On Financial Risk Management Of SEPTWOLVES Under The Light Asset Operation Model

The garment industry,in recent years,has been undergoing a transformation and upgrading of its industrial structure to meet the national innovation-driven development strategy,as the macro market environment and the Internet economy have been constantly evolving.This shift is occurring gradually from the traditional business model to the asset-light operation model.The asset-light operation model,in contrast to the traditional business model,concentrates more on R&D,brand management,and other links that bring great value to the enterprise,thus transitioning the enterprise from low added value links to high additional links in the industrial chain division.Despite the fact that Chinese garment enterprises are still in the early stages of exploration,many of them have not been altered for a considerable period and are being impacted by the novel coronavirus epidemic,thus posing numerous financial risks in the growth of these businesses.Should these financial risks not be acknowledged and managed promptly,the usual operations and production of businesses will suffer detrimental effects.This paper,based on the theories of division of labor,smile curve and financial risk management,takes Fujian Septwolves Industrial Co.,Ltd.as its theoretical foundation.as the case study object,identifies its financial risks from four aspects:financing,investment,operation and income distribution activities,and concludes that Septwolves’ short-term debt paying ability is under obvious pressure in terms of financing risk.In terms of investment risk,Septwolves has the problems of inefficient use of investment funds and low investment returns.In terms of operational risk,inventory accumulation,accounts receivable turnover inefficiency.In terms of income distribution risk,dividend policy is unreasonable,asset profitability is insufficient,and shareholders’ equity is difficult to be effectively protected.Secondly,through a comprehensive analysis of internal and external factors,this paper finds that it is mainly caused by external reasons such as the great pressure of industry competition,the overall downturn of terminal retail,the rapid impact of the Internet,as well as internal reasons such as unreasonable asset structure and investment planning under the asset-light operation mode,and low efficiency of information transfer in the value chain.Next,this paper uses the fuzzy comprehensive evaluation method to construct the financial risk evaluation system of Septwolves asset-light operation mode from four aspects of financing,investment,operation and income distribution risk,and carries out fuzzy comprehensive evaluation on it.The results show that the financial risk of Septwolves is at a medium level.Among them,investment risk and financing risk are "double high risk" with high risk value and high risk contribution degree,followed by operation risk and income distribution risk.Finally,this paper puts forward specific measures and suggestions from four aspects of financing,investment,operation and income distribution activities,in order to provide reference for Septwolves and other similar enterprises under the asset-light operation mode of financial risk prevention and control.