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The Influence of a Branch Group Purchasing Organization on the Development of Small and Medium-sized Enterprises

In: Eurasian Business Perspectives

Author

Listed:
  • Grzegorz Zimon

    (Rzeszow University of Technology)

Abstract

Operation within the framework of multi-stakeholder organizations is a big opportunity for an improvement of the financial situation of small and medium-sized enterprises. Group purchasing organizations (GPOs) are one of the popular examples of such organizations. In such institutions companies start working together to improve their market position and financial performance. They are growing dynamically. The analysis was carried out on a group of 32 trading companies operating in Poland in the branch group purchasing organizations. The analyzed enterprises are functioning in a construction industry. The study period was 2011–2015. The research was conducted with the use of a preliminary financial analysis and a financial analysis. The appropriate financial ratios were selected for the study. The analysis shows that net positive working capital is present in the audited entities. The companies have a high level of liquidity and a high level of profitability of sales. Functioning of small and medium enterprises together as part of GPOs has a positive impact on financial liquidity and profitability of enterprises. In general, high financial liquidity adversely affects the level of profitability, and high profitability reduces the level of financial liquidity. The analysis conducted showed that functioning within the branch group purchasing organization allows maintaining a high financial liquidity, and at the same time high profits, which is the basis for building a competitive advantage for small and medium enterprises and a further development of enterprises.

Suggested Citation

  • Grzegorz Zimon, 2019. "The Influence of a Branch Group Purchasing Organization on the Development of Small and Medium-sized Enterprises," Eurasian Studies in Business and Economics, in: Mehmet Huseyin Bilgin & Hakan Danis & Ender Demir & Ugur Can (ed.), Eurasian Business Perspectives, pages 145-153, Springer.
    • Handle: RePEc:spr:eurchp:978-3-030-18652-4_11
    DOI: 10.1007/978-3-030-18652-4_11
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    Cited by:

    1. Yuanyuan Hu & Shouming Chen & Fangjun Qiu & Peien Chen & Shaoxiong Chen, 2021. "Will the Volume-Based Procurement Policy Promote Pharmaceutical Firms’ R&D Investment in China? An Event Study Approach," IJERPH, MDPI, vol. 18(22), pages 1-21, November.

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