Research On The Impact Of Vertical Integration On The Performance Of Animal Husbandry Leading Enterprises

Currently,leading enterprises have become the main carrier of industrial and commercial capital to the countryside,and they are expected to become market forces that will promote the prosperity of rural industries.Domestic and foreign research conclusions on the relationship between vertical integration and enterprise performance are not consistent,including significant positive correlation,negative correlation,U-shaped,inverted U-shaped relationship.The animal husbandry industry chain is relatively long and involves industrial chain links such as livestock and poultry breeding,feed processing,slaughter,and meat processing.This article takes animal husbandry leading enterprises as an example to study the effects of vertical integration on the performance of livestock husbandry enterprises.This article aims to provide reference for the vertical integrated decision-making and performance optimization of livestock husbandry enterprises.There are two paths for livestock enterprises risk aversion from the perspective of vertical integration,one is to avoid market risk by forward integration,and the other is to avoid the raw material risk by backward integration.The analysis of the choice of vertical integration model based on the link characteristics of the industry chain indicates that,meat and dairy processing equipment,breeding production bases,and sales bases are suitable for investment self-building,feed processing along with veterinary drug vaccine manufacturing are suitable for mergers and acquisitions,livestock breeding is suitable for joint ventures,livestock and poultry breeding is suitable for contracts.There are two aspects of the mechanism of vertical integration on the performance of livestock enterprises,promotion mechanisms include saving transaction costs,increasing monopoly status,and saving production costs.The impedimental mechanisms include reducing enterprise flexibility,increasing the coordination costs of different sectors of the enterprise and weakening enterprise employees' incentives.Based on panel data of livestock husbandry companies from 2009 to 2016,the empirical analysis shows that,vertical integration level has experienced an ‘ascent,plateau,ascent,plateau' four-stage alteration,and it increased from 7.36% to 10.31%;The vertical integration has U-shaped relationship with enterprise performance,the effect of market concentration on enterprise performance changes from negative to positive with the advancement of vertical integration,enterprises with higher levels of vertical integration can obtain monopoly profits in the oligopoly market;Reducing debt proportion in the capital structure,expanding asset scale and increasing R&D investment intensity can promote the improvement of enterprise performance.In addition,enterprise scale management is still to be continuously guided by targeted discount policies.From the perspective of vertical integration,there are six paths for optimizing the performance of animal husbandry enterprises.First,selecting a vertical integration model based on the link characteristics of the industry chain.Second,adjusting the vertical integration based on the cost and benefits.Third,establishing and improving the benefit linkage mechanism with the agricultural-scale business households.Fourth,increasing the intensity and efficiency of the R&D investment.Fifth,creating a good market competition environment.Sixth,improving the accuracy and specificity of targeted discount funds.