Research On Diversification Financing Strategy Of Private Enterprises In China

After 40 years of reform and opening up,China's private enterprises have realized from nothing to have,from small to small,from weak to strong rapid development,and successfully from domestic to foreign,economic strength and competitive status have been greatly enhanced.Private enterprises have become an important force to support the social and economic development of our country.However,due to the limitation of private enterprise,such as insufficient guarantee financing ability,high guarantee cost,low loan time efficiency and poor direct financing ability,the financing difficulty of private enterprise and insufficient funds always threaten its development and survival.Therefore,enterprises need to broaden the financing channels and adopt diversified financing strategies to solve the financing problems.Diversified financing can not only make enterprises obtain large amounts of capital,but also reduce the cost of financing and optimize their capital structure.This paper analyzes the causes and effects of China Fortune Land Development Co.Ltd through combining theory and case.The conclusion of this paper is as follows: first,compared with using a single financing method,a diversified financing strategy can help a company out of its financing predicament,reduce the financing cost,improve the financing efficiency,shorten the financing cycle and optimize the capital structure.Second,when using diversified financing strategy,enterprises should choose the financing method suitable for themselves,make use of the capital market and find the financing method with lower cost.Third,the diversification of financing strategies not only depends on the enterprises themselves,but also depends on the capital market environment,is a gradual process,so there are certain risks to the use of diversification financing strategies,the government should increase the regulatory capacity.