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Since the second half of 2006, China’s A share market rose out of a surging market, the stock stock market became a hot topic for ordinary luxury handbagspeople. In the nearly 100 textile and apparel categories listed company’s report, the company diversified pattern of surface.
Younger performance report released in 2006 showed that net profit reached 270 million yuan Youngor real estate, far more than the sum of suits and shirts net profit of 1 billion; Shanshan addition to its “Chinese apparel industry leaders,” the title of foreign , Shanshan Science and Technology has become the world’s three largest high-end lithium-ion battery integrated material suppliers; Erdos Cashmere Products Co., Ltd. in 2003 to construct a coal-silicon – high energy recycling economy; this year, garment enterprises Zhuang Ji Group invested 500 million yuan official involved in the shipbuilding industry, ship manufacturing alliance in the future will be formed to set up ship trading company, Ocean Shipping Company; to produce fine wool fabrics started the Nanshan Group, it is converted into its main business market hot non-ferrous metals aluminum.christian louboutin shoes
In addition to other listed companies, the current textile and apparel companies have chosen to invest in other areas have also been common, the reasons behind that? The profits of textile and garment enterprises how much space is there? Faced with the choice of what business? Cross-industry business can bring to the business interests of recent or long-term? These are all worthy of the industry’s future development.
Needless to say, the domestic textile and garment industry faced irresistible pressure: raw materials, rising labor costs, blind and low-level duplicated construction competition caused prices are not high, low profits, and RMB appreciation, export tax rebate rate down, increasing international trade friction and so on. The increasing operating cost pressures, increasing competition in the industry situation, the Chinese textile and garment enterprises in order to seek greater survival and development space, or to seek a breakthrough in the field of Xuanze high-tech, or choose to invest in high-margin areas, which is the development of inevitable. However, diversification is risky business. Strategic risk for the company, Western scholars had long studied the one hand, to study the relationship between risk and return and risk and the management of the relationship between risk attitude; the other is to study the relationship between the return performance. 1980, Bauman on how corporate strategy adjustment Shi Shi Tong Guo risks and benefits of empirical studies examining the combination Zuiyou Fa Xian, Bing Bu as Jingji Xue and financial analysis is usually referred to, Gao Hui Bao risks linked with Gao, but the risk Zhi Di connected with the low-return, some companies through the implementation of appropriate strategies, to achieve high returns and low risk of a good combination.
From the Research of Western scholars, and business risk diversification strategy are closely related, but this relationship is very complex. Enterprises can not only solve part of the diversification strategy of operational risks, but also increase the risk of another. Diversified types, enterprise risk management experience is not the same. From the portfolio point of view, related to type a wide range of resource capacity will be more fully utilized, companies risk diversification risk, while new small enterprises to obtain better performance. The return of successful entrepreneurs, enterprises, and strengthen the confidence and ability to manage risk, encourage entrepreneurs to take a more active business activities, making faster business growth, expansion of business scale and can further enhance the anti-risk ability. This virtuous cycle of the enterprise to achieve the ultimate low-risk, high-yield business results, and that the risks and benefits of negative correlation. Unrelated diversification can reduce risk of business enterprises combined, but not Xiangguan large industries difference between the Jing Ying is difficult for enterprises making comprehensive use Yuanyou the enterprising elements, differences also 要求 business enterprises have the original different mode of technology development, market development and corporate management mode model, the new business enterprise capacity-building has often limited by the original management philosophy, leading to development of entrepreneurship not keep up with business needs, leading to lower business performance. The continued low performance would undermine their overall strength, reducing the market value, thus reducing their market reputation and financial indicators of enterprises, increase their operational difficulties and risks.
Here involves a concept in economics – the marginal benefit, that is, a market, the largest economic entity in pursuit of profit, many times to expand production, each investment will generate benefits and the benefits of previous investments between there is a difference, the difference is marginal benefit. If the marginal benefit a growing trend, then the benefits of their investment than a big one, the investment is successful, otherwise, it means failure. Enterprises should always follow the “professional + long-term planning” principle, diversification will increase the marginal benefit show.