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Journal of Applied Sciences

Year: 2013 | Volume: 13 | Issue: 22 | Page No.: 5204-5209
DOI: 10.3923/jas.2013.5204.5209
An Empirical Study on Difference Factors for SMEs’ Financing Efficiency-Evidence from SMEs in Zhejiang Province of China
Li Jiming, Yewei Chen, Yuhong Zhou and Anna Tao

Abstract: Small and Medium-sized Enterprises (SMEs) have recently taken an important role in boosting Chinese economy. The previous literatures found that SMEs in China operated the business immaturely with an inefficient fund utilization rates. They are unable to choose reasonable fund channels and hard to adjust financing strategy and structure in accordance with their own asset structure, profitability and risk status. Based on the data of 63 listed companies in Zhejiang province in the SME board of Shenzhen Stock Exchange in 2011, this study researches the SME financing difference by establishing linear regression model with the influencing factors of assets scale, profitability and operating costs. The results show that net profit is an indicator reflecting the profitability of the corporate assets and the different profitability of Chinese SMEs is the key to differentiate the financing efficiency. It is also found that enterprises with strong profitability are expected with good debt paying ability by the market which shows a higher liability financing efficiency.

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How to cite this article
Li Jiming, Yewei Chen, Yuhong Zhou and Anna Tao, 2013. An Empirical Study on Difference Factors for SMEs’ Financing Efficiency-Evidence from SMEs in Zhejiang Province of China. Journal of Applied Sciences, 13: 5204-5209.

Keywords: Financing difference, efficiency factors and multiple linear regression

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