IDEAS home Printed from https://ideas.repec.org/a/mup/actaun/actaun_2017065041435.html
   My bibliography  Save this article

Identification of Financial Strategy in Small and Medium-sized Entrepreneurship

Author

Listed:
  • Veronika Svatošová

    (Faculty of Regional Development and International Studies, Mendel University in Brno, Třída Generála Píky 2005/7, Brno - Černá Pole, 613 00, Czech Republic)

Abstract

This paper deals with the importance of financial strategy development of small and medium-sized enterprises (SMEs) in the winery industry. The main objective of the paper is to identify the current financial strategy of small and medium-sized enterprises and afterwards to propose changes that lead to new financial strategy. The research methods are the selected methods of financial analysis, collecting data about the research sample of SMEs, modelling the financial strategy with the help of Vensim program and further simulation of this model in business practice. The model derives from the previous research activities. The purpose of this paper is also to verify the usage of theoretically created model in small and medium-sized entrepreneurship and find the optimal financial strategy in the area examined. The results of this paper show the selected area of small and medium-sized entrepreneurship uses mainly the financial strategy of maximum liquidity (conservative strategy) in all observed years (2010-2014). This means the selected research sample of SMEs do not use progressive investment strategy with a further development. This result could highlight that SMEs in agricultural sector do not meet the financial strategy with corporate strategy focused on other business development. It is recommended to change this strategy into balancedfinancial strategy focused on higher profitability that could be used for the other expansion and development of the company.

Suggested Citation

  • Veronika Svatošová, 2017. "Identification of Financial Strategy in Small and Medium-sized Entrepreneurship," Acta Universitatis Agriculturae et Silviculturae Mendelianae Brunensis, Mendel University Press, vol. 65(4), pages 1435-1453.
    • Handle: RePEc:mup:actaun:actaun_2017065041435
    DOI: 10.11118/actaun201765041435
    as

    Download full text from publisher

    File URL: http://acta.mendelu.cz/doi/10.11118/actaun201765041435.html
    Download Restriction: free of charge
    File URL: http://acta.mendelu.cz/doi/10.11118/actaun201765041435.pdf
    Download Restriction: free of charge
    File URL: https://libkey.io/10.11118/actaun201765041435?utm_source=ideas
    LibKey link: if access is restricted and if your library uses this service, LibKey will redirect you to where you can use your library subscription to access this item
    ---><---

    As the access to this document is restricted, you may want to search for a different version of it.

    References listed on IDEAS

    as
    1. Mirjam Schiffer & Beatrice Weder, 2001. "Firm Size and the Business Environment : Worldwide Survey Results," World Bank Publications - Books, The World Bank Group, number 13988.
    2. Irena Jindrichovska & Erginbay Ugurlu & Dana Kubickova, 2013. "Changes in Capital Structure of Czech SMEs: A Dynamic Panel Data Approach," Ekonomika a Management, Prague University of Economics and Business, vol. 2013(3), pages 6-26.
    3. Henkel, Joachim, 2006. "Selective revealing in open innovation processes: The case of embedded Linux," Research Policy, Elsevier, vol. 35(7), pages 953-969, September.
    4. Sophia Davidova & Laure Latruffe, 2007. "Relationships between Technical Efficiency and Financial Management for Czech Republic Farms," Journal of Agricultural Economics, Wiley Blackwell, vol. 58(2), pages 269-288, June.
    5. Aulová, R. & Hlavsa, T., 2013. "Capital Structure of Agricultural Businesses and its Determinants," AGRIS on-line Papers in Economics and Informatics, Czech University of Life Sciences Prague, Faculty of Economics and Management, vol. 5(2), pages 1-14, June.
    6. Tulio A. Cravo & Bettina Becker & Adrian Gourlay, 2015. "Regional Growth and SMEs in Brazil: A Spatial Panel Approach," Regional Studies, Taylor & Francis Journals, vol. 49(12), pages 1995-2016, December.
    7. Matthew T. Billett & Tao‐Hsien Dolly King & David C. Mauer, 2007. "Growth Opportunities and the Choice of Leverage, Debt Maturity, and Covenants," Journal of Finance, American Finance Association, vol. 62(2), pages 697-730, April.
    8. Anna Comacchio & Sara Bonesso & Claudio Pizzi, 2012. "Boundary spanning between industry and university: the role of Technology Transfer Centres," The Journal of Technology Transfer, Springer, vol. 37(6), pages 943-966, December.
    9. Steel, William F & Webster, Leila M, 1992. "How Small Enterprises in Ghana Have Responded to Adjustment," The World Bank Economic Review, World Bank, vol. 6(3), pages 423-438, September.
    Full references (including those not matched with items on IDEAS)

    Most related items

    These are the items that most often cite the same works as this one and are cited by the same works as this one.
    1. Engelhardt, Sebastian v. & Freytag, Andreas, 2013. "Institutions, culture, and open source," Journal of Economic Behavior & Organization, Elsevier, vol. 95(C), pages 90-110.
    2. Battaglia, Daniele & Landoni, Paolo & Rizzitelli, Francesco, 2017. "Organizational structures for external growth of University Technology Transfer Offices: An explorative analysis," Technological Forecasting and Social Change, Elsevier, vol. 123(C), pages 45-56.
    3. Custódio, Cláudia & Ferreira, Miguel A. & Laureano, Luís, 2013. "Why are US firms using more short-term debt?," Journal of Financial Economics, Elsevier, vol. 108(1), pages 182-212.
    4. Ambrocio, Gene & Colak, Gonul & Hasan, Iftekhar, 2022. "Commitment or constraint? The effect of loan covenants on merger and acquisition activity," Finance Research Letters, Elsevier, vol. 47(PB).
    5. Francesco Quatraro & Marco Vivarelli, 2015. "Drivers of Entrepreneurship and Post-entry Performance of Newborn Firms in Developing Countries," The World Bank Research Observer, World Bank, vol. 30(2), pages 277-305.
    6. Stefani, Gianluca & Gadanakis, Yiorgos & Lombardi, Ginevra Virginia & Tiberti, Marco, 2017. "The impact of financial leverage on farms capacity to react in market shocks," 2017 International Congress, August 28-September 1, 2017, Parma, Italy 261156, European Association of Agricultural Economists.
    7. Alzoubi, Ebraheem Saleem Salem, 2018. "Audit quality, debt financing, and earnings management: Evidence from Jordan," Journal of International Accounting, Auditing and Taxation, Elsevier, vol. 30(C), pages 69-84.
    8. Vincenzo Vignieri, 2021. "Crowdsourcing as a mode of open innovation: Exploring drivers of success of a multisided platform through system dynamics modelling," Systems Research and Behavioral Science, Wiley Blackwell, vol. 38(1), pages 108-124, January.
    9. Erasmo Giambona & Rafael Matta & José-Luis Peydró & Ye Wang, 2020. "Quantitative easing, investment, and safe assets: the corporate-bond lending channel," Economics Working Papers 1722, Department of Economics and Business, Universitat Pompeu Fabra, revised Oct 2020.
    10. Mou, W.M. & Wong, W.-K. & McAleer, M.J., 2018. "Financial Credit Risk and Core Enterprise Supply Chains," Econometric Institute Research Papers EI2018-27, Erasmus University Rotterdam, Erasmus School of Economics (ESE), Econometric Institute.
    11. John Victor Mensah & Michael Tribe & John Weiss, 2007. "The small-scale manufacturing sector in Ghana: a source of dynamism or of subsistence income?," Journal of International Development, John Wiley & Sons, Ltd., vol. 19(2), pages 253-273.
    12. Love, Inessa & Peria, Maria Soledad Martinez & Singh, Sandeep, 2013. "Collateral registries for movable assets : does their introduction spur firms'access to bank finance ?," Policy Research Working Paper Series 6477, The World Bank.
    13. Joshua D. Rauh & Amir Sufi, 2010. "Capital Structure and Debt Structure," The Review of Financial Studies, Society for Financial Studies, vol. 23(12), pages 4242-4280, December.
    14. Djembissi, Bertrand, 2011. "Excessive risk taking and the maturity structure of debt," Journal of Economic Dynamics and Control, Elsevier, vol. 35(10), pages 1800-1816, October.
    15. Shang, Chenguang, 2021. "Dare to play with fire? Managerial ability and the use of short-term debt," Journal of Corporate Finance, Elsevier, vol. 70(C).
    16. Segarra Blasco, Agustí, 1958- & Teruel, Mercedes, 2010. "Are small firms more sensitive to financial variables?," Working Papers 2072/151623, Universitat Rovira i Virgili, Department of Economics.
    17. Khalil, Samer & Mansi, Sattar & Mazboudi, Mohamad & Zhang, Andrew (Jianzhong), 2019. "Information asymmetry and the wealth appropriation effect in the bond market: Evidence from late disclosures," Journal of Business Research, Elsevier, vol. 95(C), pages 49-61.
    18. Kaufmann, Daniel & Batra, Geeta & Stone, Andrew H. W., 2003. "The Firms Speak: What the World Business Environment Survey Tells Us about Constraints on Private Sector Development," MPRA Paper 8213, University Library of Munich, Germany.
    19. Sugato Chakravarty & Chiraphol N. Chiyachantana & Christine Jiang, 2011. "THE CHOICE OF TRADING VENUE AND RELATIVE PRICE IMPACT OF INSTITUTIONAL TRADING: ADRs VERSUS THE UNDERLYING SECURITIES IN THEIR LOCAL MARKETS," Journal of Financial Research, Southern Finance Association;Southwestern Finance Association, vol. 34(4), pages 537-567, December.
    20. Petra Ruckova & Nicole Skuláňová, 2020. "What determines leverage in selected countries of Central and Eastern Europe in the automotive industry," Journal of Administrative and Business Studies, Professor Dr. Usman Raja, vol. 6(5), pages 205-221.

    Corrections

    All material on this site has been provided by the respective publishers and authors. You can help correct errors and omissions. When requesting a correction, please mention this item's handle: RePEc:mup:actaun:actaun_2017065041435. See general information about how to correct material in RePEc.

    If you have authored this item and are not yet registered with RePEc, we encourage you to do it here. This allows to link your profile to this item. It also allows you to accept potential citations to this item that we are uncertain about.

    If CitEc recognized a bibliographic reference but did not link an item in RePEc to it, you can help with this form .

    If you know of missing items citing this one, you can help us creating those links by adding the relevant references in the same way as above, for each refering item. If you are a registered author of this item, you may also want to check the "citations" tab in your RePEc Author Service profile, as there may be some citations waiting for confirmation.

    For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: Ivo Andrle (email available below). General contact details of provider: https://mendelu.cz/en/ .

    Please note that corrections may take a couple of weeks to filter through the various RePEc services.

    IDEAS is a RePEc service. RePEc uses bibliographic data supplied by the respective publishers.