The Research On Effect Of The Profitability Of Guangdong SMEs For Guarantee Financing

Due to December2011, there are about1.1million small and medium-sized enterprises (hereinafter referred to as "SMEs") in Guangdong Province (hereinafter referred to as "GD") placing the second in the country. The SMEs play an important part of China’s economy. It is also the important foundation to maintain the steady and sustainable development of social society. Meanwhile, our development, employment and social stability are closely related to the SMEs. Similar to other areas in the country, with a small scale, operating conditions of instability, low creditworthiness, the lack of effective mortgage and pledge of assets, it is difficult to directly obtain a bank loan for most SMEs. The corporation with guarantee companies is an important way to solve this problem. Therefore, to solve the financing difficulties of SMEs, to won the trust for guarantying is particularly important, also with practical significance.The paper focus on the relationship between the profitability and the guarantee amount by using the empirical research method. Firstly, it describes the background and significance of the research, research contents and methods, research status at home and abroad, and lists the research framework. Then analyse Guangdong’s SMEs profit ability, guaranteed limit status quo and the problems between the two; Then put forward the research hypothesis on the basis of theoretical analysis, research on equity nature, industry type, geographical location to distinguish between different types of corporate profitability the impact of its access to guaranteed amount. Finally, the research results of this paper is analyzed and draw inspiration. In this paper, the research results show that:(1) In general, the higher profitability of SMEs, the greater the amount of guarantees can be obtained;(2) profitability under the equity nature of warranties do not have dominant effect, namely compared with higher profitability of private SMEs, under the state-owned equity of SMEs are more likely to have the guarantee of the high quota;(3) profitability under the industrial types of warranties do not have dominant effect, namely, compared to the high profitability of the first industry, the second and the third industry is more likely to have the guarantee of the high quota;(4) profitability under the geographical location of warranties do not have dominant effect, compared to the less developed areas, SMEs from developed areas are more likely to have the guarantee of the high quota.In this paper, empirical proof of SMEs to improve profitability and help it obtain guarantees recognized by companies and financial institutions, and thus more smoothly to obtain bank loans; But only high profitability may not be able to obtain a high guarantee amount, the definitiveness of profitability is influenced by corporate equity nature, industry type and location (the degree of economic development). Thus put forward appropriate constructive proposals to different corporate equity nature, industry and location’s finance loan guarantees supported police; empirical model have a certain reference value to the security company during the project appraisal and guarantee programs designed.