The Institutional Environment,Customer-Supplier Relationship And Corporate Cash Holdings

Cash assets are characterized by strong liquidity,and it is one of the important wealth of enterprises,the level of cash holdings of the enterprise's production and operation and development plays an important role.When the economic crisis comes,the role of cash will be more prominent,when a large number of enterprises due to capital chain fracture facing bankruptcy predicament,adequate cash reserves of enterprises can escape the crisis,to seize the better development opportunities,which makes the "cash is king" business philosophy Gradually prevailed.In recent years,The performance of China!s manufacturing industry overcapacity is more and more serious imbalance between supply and demand of the development the contradiction between also more and more obvious.In this case,the competition between individual enterprise and enterprise gradually into the basic unit of the supply chain competition,customers and suppliers to become strategic development enterprises need to consider one of the important factors.The enterprises establish and maintain a lasting customer-supplier relationship,to reduce the competitive pressure;access to competitive advantage has important strategic decision-making significance.The main problems of this paper include whether the customer-supplier relationship will have an impact on the cash holdings of its enterprises,and what kind of effect will be based on what kind of principles;further,based on the special institutional background of regional imbalances in China,Explore the institutional environment in the relationship between the customer's customer-supplier relationship and the level of cash holdings,what is the role of inhibition or promotion.With the above problems,this paper searches and organizes the panel data of listed companies in China's A-share manufacturing industry from 2008 to 2014.Through the combination of theory and practice,we have the following conclusions.In the other conditions remain unchanged,the company's customer-supplier relationship is higher,that is,business and important customers and important suppliers of the relationship between the closer,the stronger their dependence on their cash holdings high.This is mainly due to the face and other threats in the price of the customer or supplier,due to the precautionary motive,enterprises will maintain a high level of cash holdings,also show its stable running.Therefore,it is recommended that the relevant government departments should be adapted to local conditions,due to time and conditions,and actively implement comprehensively deepen reform,strengthen the efiforts to improve the system of the backward area environment for the majority of enterprises to provide a more mature and perfect market environment,increasing the service efficiency of funds.