| Just In Time production (here in after referred to as JIT) is known as appropriate manufacturing technology in Chinese. JIT is a modern organization mode of production. It promotes the competence of enterprises in market economy and realizes their strategic goals by way of three methods; namely, cost control, optimization of product distribution, and improvement of product quality. At its core, JIT is about eliminating waste and non value-added work, with the purpose of realizing continuous-flow and demand-flow from the production line to the customers without intermission. That means producing the end product is just in time to meet the market demand of for it. JIT tries to enhance the market adaptability of the enterprises through effective inventory management, hereby promoting enterprises’ financial performance. On the one hand, the just-in-time manufacturing technology can improve the company management and the operation fluency, so as to lower the cost of production and sales, which have a positive impact on financial performance. On the other hand, it does require the support of various departments, unfolding a complex operation system. The difficulties in practice may also bring negative influence on financial performance. Opinions vary on this problem. So far, the domestic and international scholars have not yet reached a unified conclusion about the impact of JIT on corporation financial performance. Research is therefore necessary on what impacts of JIT on financial performance are and how JIT works in listed companies.By means of linking whether implementing JIT or not as the dummy variables with corporate financial performance, relative information of sixteen financial indicators from thirty companies from the year 2013 to the year 2015 were selected in this paper. With SPSS19.0 statistical software, empirical research on the effects of implementing JIT on financial performance started. During the empirical process, two sample groups were selected in this paper. One was the listed companies with JIT, and the other was the listed companies without JIT. Firstly, the comprehensive scores of the financial performance in the listed companies were calculated by factorial analyzing. Then with the total assets taken as control variables, a partial correlation analysis was done between JIT and several abilities in financial performance, including profitability, operating capabilities, solvency and development capacity. At last, the most significant correlation among financial performance, JIT and Size was selected for setting up a linear regression model. After the empirical research, four results were found. Firstly, a significant positive correlation was shown between the implementation of JIT and the profitability of the listed companies. Secondly, it was not a close relation between the implementation of JIT and the operational capabilities of the listed company. Thirdly, a certain negative but not obvious correlation was shown between the implementation of JIT and solvency of the listed company. Finally, a certain positive and fluctuant correlation appeared between the implementation of JIT and the development ability of the listed companies. In conclusion, implementing JIT clearly impacts a corporation’s financial performance. The effects were shown mainly in profitability, solvency and the development of enterprises. The value of the effect was determined by a comparison between the positive and negative effects caused by implementation of JIT affecting profitability, development ability and solvency. |
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