Who is the culprit in business failures? - The financial crisis, household electrical appliance ente

Who is the culprit in business failures? - The financial crisis

, household electrical appliance ente

Recently, the business failures of the bad news came from time to time, various reports and analysis is heard, some say the financial crisis was the culprit, some say the closure of businesses is inherently "bad" ... ...

What causes rapid death of these companies? Securities Times reporter interviewed in the investigation found, are in the forefront of the crisis, many enterprises are "large-scale closures coming," one said, do not think. Because in their eyes, if the business is not practical, management is not strict, failure will be inevitable, the financial crisis only accelerated the death rate of these enterprises only.

"Asphyxiating death"

Liu Yunfeng is provided in Ningbo, a chattel mortgage companies had regulatory business. The so-called movable property of the legislation is to provide personal property security for SMEs, the less real for small and medium enterprises, in need of loans, banks will be to come up with innovative ways to movable property as collateral, usually the personal property, including inventory, materials and so on.

Now, Liu Yunfeng chattel mortgage company provides monitoring services for more than 10 billion yuan. Originally operating as usual, but the recent emergence is a crisis, due to large drops in the prices of raw materials make the value of collateral has shrunk dramatically, in a very short period of time over bank value of real estate required to monitor the bottom line. This time is so short that even too late to allow SMEs to increase the collateral, banks began to panic and want to recover the loan immediately to avoid losses.

"This is an avalanche-like failure, because SMEs are facing an unprecedented crisis, the funds have been very tight, if the bank immediately pumping loans, enterprises will surely go under." Liu Yunfeng, this is a suffocation death, Enterprises no room to maneuver, not a body necrosis, is suddenly to drain the blood.

Survey found that in Zhejiang, due to the recent sharp fall in commodity prices in a crisis or even a "suffocation death" of the enterprise is not the case, Jintian Copper face problems similar to this. In accordance with the scale of operation, with the collapse of international copper price, only one stock, the losses Jintian Copper is expected to more than 1.2 billion yuan, and the slump in copper prices to make customers appear very high default rates. Then, the banks will require the enterprises to prepayment, or due for payment, the longer Xudai. Thus, the already short of capital and enterprise, it is vulnerable to money-strand breaks.

Suffered a financial strand breaks not only the gold and copper, in Hong Kong U-Right Clothing Co., Ltd. Shunde factory is similar. The plant's sudden closure of the main and expansion too fast, too much about debt. It is learned from a year earlier, the company in Hong Kong's retail network has increased to of 95 of 64. Meanwhile, the U-investment in the country has a lot of projects, the final vote as long-short bond funds caused production base in Wuhan strand breaks, and thus a full-blown crisis.

Fuse into a financial crisis

The sudden closure of these large enterprises have begun fermentation, the market worried about this, fearing a chain reaction, the formation of large enterprises will close down, but some business people were not impressed.

Lighting a well-known company's chairman said the company's collapse has, without exception, with over-borrowing, blind expansion and investment. They always imagined a few years time you can catch up on the world level, but companies like GE are not a few years can be accomplished. Blind expansion, the inevitable result of high debt management is that when the industry downturn will be in trouble, or even close down. However, prudent management of those businesses, there will be no closure of the contrary is a good time to expand.

Jokes that he told reporters, "sub-prime mortgage crisis is now the chaos many companies invest a scapegoat for the blind expansion. To the end of the year, you will find that many of the listed company's annual report will appear in 'As the subprime mortgage crisis, an investment company failed to achieve the desired return on investment; or poor business performance 'and so on rhetoric.

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