Research On Financial Risk Management Under The Diversification Strategy Of G Group

The process of global economic integration is accelerating,the tide of the information age is booming,various resources such as technology,trade and financial capital are constantly flowing,and the market competition is becoming increasingly fierce.The living environment faced by enterprises has undergone earth shaking changes.Many large group companies have begun to explore the road in line with the development of enterprises.The discussion on which is better or worse between simplification and diversification strategy has never stopped since the moment of the emergence of diversification strategy.Looking at today’s world,almost all the companies with the highest returns,whether Coca Cola,lululemon,UNIQLO,apple and Tesla,have chosen the large single product strategy.Because in the long-term operation,the focused strategy dilutes all R & D and investment as fixed costs in enough sales,so it provides shareholders with a far higher rate of return.However,there are many successful cases of enterprises adopting diversification strategy.Whether it is American General Electric Company or Haier Group in China,many enterprises have broken through the development bottleneck through diversification strategy and pushed their development to a new height.So how do enterprises implement diversification strategy to obtain new development opportunities? What risks will diversification strategy bring to enterprises? This thesis will explore the diversification strategy of enterprises from the perspective of financial risk management.Taking G group,a leading enterprise in the household appliance industry,as an example,this thesis analyzes the motivation for the implementation of its diversification strategy and what financial risks it brings to enterprises,and finally obtains effective financial risk management measures for enterprises.Taking G group as an example,by analyzing the financial indicators of G group from 2015 to 2020,and taking the industry data as the benchmark vertically,this thesis compares the financial data of G group with the industry data in terms of profitability,solvency and operating capacity,so as to identify the financial risks such as financing risk,investment risk and liquidity risk under the diversification strategy of G group.This thesis constructs a risk management system,selects indicators by means of correlation analysis,determines the weight of indicators by using entropy method,quantifies the financial risk of G group’s diversification strategy by using efficacy coefficient method,and determines the financial risk level of G group according to the industry risk classification standard.From this,it is analyzed that with the deepening of diversification strategy,the degree of financial risk has improved in recent years and there is a certain financial crisis,It should be paid enough attention.Finally,it puts forward some suggestions and countermeasures,such as the implementation of vertical integration diversification strategy,the establishment of scientific management system,the improvement of employee stock ownership and internal incentive mechanism,the improvement of financial risk early warning system,and the construction of risk management system.It is hoped that the relevant countermeasures and suggestions on financial risk control in the diversification strategy of G group can be used for reference by other household appliance enterprises implementing the diversification strategy.