XG Enterprise Cost Stickiness Research

In the face of overcapacity,a saturated market,intensified competition,narrowing survival space,and declining profits in the engineering machinery industry,cost management has become the focus of business management for engineering machinery enterprises.Effective cost management requires enterprise managers to have a correct and clear understanding of the cost behavior of the enterprise.Traditional cost theory proposes that cost behavior presents linear changes with business volume,which is easy to understand and widely applied in the process of enterprise cost management.However,its accuracy has certain limitations.In recent years,the cost stickiness theory has been proposed,which believes that cost behavior presents asymmetric changes with business volume.Through a large amount of empirical research,it has been shown that the cost stickiness theory can help enterprises comprehensively and accurately understand and grasp cost behavior,thereby more effectively guiding enterprise cost management and providing a new perspective for building cost competitiveness advantages.This article conducts a case study on engineering machinery enterprise XG,exploring and studying the current situation and influencing factors of cost stickiness.Firstly,through research and analysis of cost stickiness literature,the three main theories affecting cost stickiness are discussed in depth: adjustment cost theory,manager expectation theory,and agency theory.Secondly,combined with XG’s financial cost data in recent years and the problems in cost management,the current situation of XG’s cost management is understood.On this basis,the existence of XG’s cost stickiness is evaluated,and the Weiss model is used to calculate and analyze cost stickiness.Then,the three types of cost stickiness influencing factors,adjustment cost theory,agency theory,and manager expectation theory,are discussed,and their effects on XG’s cost stickiness are examined by establishing a regression model.Finally,measures are proposed to adjust XG’s cost stickiness.Through the research of this article,the following three conclusions are drawn: First,XG’s cost stickiness is easily affected by influencing factors,with large fluctuations,and sometimes exhibits anti-stickiness.Second,through the qualitative analysis of the influencing factors of XG enterprise cost stickiness and the effect test,it is found that the capital intensity,human capital intensity,managers’ optimistic expectation and corporate free cash flow promote the capital liability ratio and executive compensation will reduce the enterprise cost stickiness;the capital intensity and capital liability ratio have the greatest impact on the enterprise cost stickiness,the human capital intensity and executive compensation are second,while the enterprise free cash flow and management expectation have little impact on the cost stickiness;Third,XG can adjust its cost stickiness through enhancing the enthusiasm and ability of managers in cost management,optimizing enterprise resource allocation,adjusting asset structure,and strengthening enterprise human resource efficiency.