Studies On The Financing Of Tea Enterprises In Ya'an, Sichuan Province

Sichuan is a big tea planting Province in China, while Ya'an City is one of the major tea production areas in Sichuan Province. At present,There are 506000 mu of tea garden, 52600 tons of tea production,25 hundred millions of output value. The tea industry has been one of the most important constituents for the economic development on agriculture. It also has significant attribution in bringing increasing incomes for farmers. However, the great opportunity is coming with a big challenge. As a key of the tea industry, the development of tea enterprise can absolutely affect the development of the tea industry.There are more than four hundreds tea enterprises in Ya'an city now. Nevertheless, small-scale, lack of funds, financing difficulties, single financing method and limited funding sources has plagued the tea enterprises in Ya'an for a long time. This paper targets in Ya'an Tea Enterprises. By analyzing the financing problems, financing structure and operating performance, we aim to construct a reasonable financing structure, and hence maximize the benefits and facilitate the development of tea enterprises.The thesis is comprised of three parts. The first section is the basis of the whole research, including the purpose and significance of the study, basic definitions, literature review and fundamental theories of financing (chapters 1 and 2). The second section is the center of this study including the chapters 3 and 4. Analysis of the financing problems, specially the relationship between the financing structures and operating performance, is included. Financing channel, bank loans, capital utilization are described in statistics method. The causes of difficulties in financing and institutional innovation taken by Ya'an government are also discussed. The measurements of financing structures are carried out by selected DAR, and operating performance through ROE, we use regression analysis method to deal the data and further analyze the relation between financing structure and operating performance. In the third section, improved financing ways and operating performance for the tea enterprises are suggested based on the previous studies (the chapters 5).Through the research, we come to the following conclusions:because of the single financing way, excessive dependence on inner financing source, and low asset-liability ratio, loan is still the major method for the financing business. The analysis of the 2007-2009 financial data reveals a significantly positive correlation between asset-liability ratios and operating performance but no a reasonable scope of liabilities. According to the empirical research as well as the specificity of tea enterprises in Ya'an, we propose that government should play a leading role in building coordinate relations between banks and enterprises. At the same time, tea enterprises themselves should correctly weight the pros and cons of liabilities, improve financial management and optimize the capital structure.