Customer Concentration,Financial Flexibility And Enterprise Performance

In the current unpredictable economic climate,coupled with the impact of the epidemic,companies are increasingly recognising that strategic partnerships with customers can play a pivotal role in their long-term development.Increasing customer concentration and collaborating with key customers is an effective way for companies to gain competitiveness.However,there is a lack of research on how customer concentration affects the financial decisions of a company from the perspective of its relationship with its customers,especially in terms of financial flexibility.In order to better explore the impact of customer concentration on corporate performance,this thesis uses an empirical test to explore the relationship between customer concentration,financial flexibility and corporate performance,i.e.whether financial flexibility plays a mediating role in the relationship between customer concentration and corporate performance.Firstly,this thesis reviews the domestic and international literature on customer concentration,financial flexibility and corporate performance in turn,and reviews their research.Secondly,core concepts are defined and supply chain management theory,cash holding and uncertainty theory,resource dependence theory,transaction cost theory and optimal order financing theory are elaborated.Again,research hypotheses are formulated and research models are constructed based on the literature and relevant theories.Finally,in order to verify the correctness of the hypothesis,this article selects A-share listed companies during the period 2012-2021 as the research sample and uses the STATA software and the relevant model to empirically analyse the relationship between customer concentration and corporate performance and the mediating effect of financial flexibility.The results show:(1)Maintaining a high level of customer concentration helps to improve corporate performance.(2)Customer concentration is significantly and positively related to financial flexibility.(3)Reserve financial flexibility can effectively improve corporate performance.(4)A new pathway for customer concentration to influence firm performance is revealed,i.e.financial flexibility plays a partially mediating role in the relationship between customer concentration and firm performance.Based on the research findings,this thesis puts forward relevant suggestions from both the enterprise and government sectors,and also points out some shortcomings in this thesis and the outlook of future research directions.