An Empirical Analysis Of Concentration Ratio On Chinese Cigarette Industry

Monopoly business has been a problem that we intended to tackle. When the state monopoly business, such as rail train, telecommunication and electricity, successively organize reform, it is particularly salient in the case of tobacco business, which has a feature of franchise. However, China tobacco business in the franchise system, appear to be large in size but not strong enough by itself. It is also short of international competitive strength. With China' s tobacco market gradually open up, tobacco industry will be confronted with a more severe challenge. The reform of tobacco business is mediated by the market and run by the franchise system. It has been an important target for such a reform to speed up the reform in tobacco business system and to transform it from administrative monopoly to economic monopoly.This essay analyzes the circumstances of the whole cigarette industry in China, by exerting the statistic data of cigarette industry from 'JiuWu' on and on, evaluating the effects pf business structure, products structure and outer factors. It indicates that the whole industry obtained certain achievement after the reform while there is still a big gap between domestic companies and transnational companies, especially in the field of industry focus.In terms of industry focus, it uses Concentration Ratio and Herf indahl Index to calculate. The result illustrates that the industry focus has hardly changed although the quantity for enterprises decreased a lot due to the 'Guan Xiao' strategy in the industry in these years. The tobacco industry is still in the stage of scattered situation.In terms of the performance, this essay analyzes the whole industry, based on the data of 5 groups derived from the outputs. By calculating and comparing all sorts of the index, it illustrates the scale economies of enterprises in Chinese cigarette industry is very prominent. Therefore, it proves that it is suitable for cigarette industry toorganize productivity and management by big conglomerate and big company. We use Factor analytical method and the statistic software "SPSS11.0" to assess the synthetic ability of the enterprises in various classes in 2002. The result shows that synthetic ability of the big enterprises obviously increases while human resource management and capital application perform comparatively passively. According to the result of the analysis, this essay expounds different method of restructure for the relevant enterprises in different size. In the end, it proposed some suggestions for the industry development in four aspects, which are enterprise structure, brand enlargement, tax reform, and strengthening the competition ability.