Study On The Impact Of Asset Model On Earnings Persistence Of Pig Breeding Enterprises

Agriculture as the first industry in our national economy plays a very important role.Since ancient times,there has often been a saying that "pig food security in the world".To ensure the stable quantity and price of live pigs is a major matter related to people’s livelihood.For this reason,the state has for many years listed items in the No.1 Central document emphasizing the implementation of the policy of stable production and supply of live pigs.China’s pig breeding industry has huge market potential,but low industry concentration,serious contradiction between supply and demand,and obvious price fluctuations increase the uncertainty of enterprise production and operation.Most pig enterprises have to think about how to carry out industrial layout,ensure the volume of pig production,and improve the sustainability of enterprise surplus.In the process of development,the pig breeding industry has gradually divided into two types of asset operation modes.The asset-heavy operation mode requires a large amount of investment for long-term accumulation,while the asset-light operation mode has rapid development and small investment,which can improve the efficiency of resource integration.Many scholars also believe that the asset-light mode is more conducive to improving the earnings capacity of enterprises and bringing better earnings sustainability for enterprises.However,due to the particularity of the industry,under the influence of the pig cycle,the earnings sustainability performance of pig breeding enterprises with asset-heavy operation mode is not worse than that of those with asset-light operation mode,or even slightly better.Therefore,this paper believes that it is necessary to explore the impact of asset operation mode differences on earnings sustainability,analyze the reasons behind the differences,and propose countermeasures for enterprises to improve earnings sustainability.Based on this phenomenon,this paper firstly collects and sorts out relevant theories extensively.On this basis,two most representative enterprises in the industry are selected as research objects.Starting from the status quo of earnings sustainability of the case enterprises,the paper comprehensively adopts case study method,comparative analysis method and financial index analysis method to explore the influence mechanism of asset operation mode of pig breeding enterprises on earnings sustainability.The intention is to find a more suitable asset operation mode for the development of pig enterprises through research.It is found that the earnings of the two enterprises are susceptible to the influence of industry cycles,but the earnings capacity of Makihara Stock,which focuses on the asset-based operation mode,is better than that of Wenshi Stock.The dispersion of earnings indicators and geometric average growth rate are better than that of Wenshi Stock,showing better earnings sustainability.The reasons are as follows: first,under the asset-heavy operation mode,enterprises can give full play to the scale effect,carry out fine production management,have more obvious cost advantages,and better ability to deal with pig cycle risks;Second,under the asset-heavy operation mode,enterprises actively build upstream and downstream industries,bring the whole link from the production end to the sales end under the management and control of enterprises,play the synergistic role of the industrial chain,shift the pressure of the breeding end and improve the added value of products.Third,the asset-heavy enterprises have more fixed assets that can be used for mortgage loans.Reinvigorating these high-quality assets for loan guarantee can make up for the shortage of funds and help enterprises to seize the market in advance during the downward trend of pork expansion.The research of this paper mainly draws the following conclusions: due to different asset operation modes,enterprises’ differences in cost control,industrial chain control and financing ability will ultimately affect the volume and sales cost of enterprises.In the case of large fluctuations of the industry as a whole,breeding enterprises with asset-heavy operation mode have low sales cost,stable volume of sales and good sustainability of corporate earnings.For the pig breeding industry to improve the sustainability of surplus,the following suggestions are put forward: First,enterprises should grasp the development trend of the industry,actively explore the upgrading of breeding mode,strengthen the investment of enterprises’ own assets,build and revitalize high-quality assets.Second,pay attention to cash flow management,expand financing channels and financing methods,ensure the stability of cash flow;Third,strengthen the ability of cost control,improve the efficiency of breeding;Fourth,actively layout the upstream and downstream industrial chain,promote the upgrading of enterprises from farming to food processing and sales mode,play the synergistic role of the whole industrial chain,reduce the adverse impact of external environment changes,and achieve long-term and stable development of enterprises.