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Liburkina L. M.

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The Financial Diagnosis of Crisis in Garment Enterprises: Segmentation by Size
Batrak О. V., Tarasenkо I. O.

Batrak, Оlga V., and Tarasenkо, Iryna O. (2020) “The Financial Diagnosis of Crisis in Garment Enterprises: Segmentation by Size.” Business Inform 4:172–179.
https://doi.org/10.32983/2222-4459-2020-4-172-179

Section: Economics of Enterprise

Article is written in Ukrainian
Downloads/views: 2

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UDC 336.6+338.48

Abstract:
The article is aimed at defining the causal relationship between the size of garment enterprises and the depth of the crisis on the results of financial diagnosis. The article segmented twenty-three garment enterprises with over a ten-year period of activity. Based on the processing of the financial and economic indicators, it is proposed to divide into groups by asset value and sales volume in order to diagnose crisis in garment enterprises as follows: small – up to 2 million UAH, medium – from 2 to 10 million UAH, large – more than 10 million UAH. Small garment enterprises, which have a clear tendency to reduce assets and/or sales, are the most likely to experience a crisis, abandoning garment activities in favor of leasing real estate, machinery and equipment. The greatest ability to counter crisis is demonstrated by medium in terms of both size and sales garment enterprises, which have the ability to quickly adapt to changes in the external environment, as well as to cover losses of activities by owners to maintain financial competitiveness in the face of strong growth and expansion of the share of the garment market. Factors in preventing a crisis in large garment factories are compliance with structural development rules: exceeding sales growth rates over the growth rate of expenditures and assets, proportionate build-up and renewal of production capacity on an innovative basis. In forecasting the type of financial sustainability as to garment enterprises, it is necessary to take into account the average historical data, the trend of complex assessment and its latest level. The key indicators of valuation are: a slowdown in asset turnover, loss ratio of equity, presence of uncovered losses in the balance sheet, negative value of own working capital, low value of the ratio of coverage of stocks by working capital. Prospect for further research would be substantiating the methodical approaches to evaluation of money flows in the system of diagnosing crisis in garment enterprises.

Keywords: financial diagnostics, crisis, garment enterprises, segmentation, size.

Tabl.: 1. Bibl.: 13.

Batrak Оlga V. – Assistant, Department of Finance and Financial and Economic Security, Kyiv National University of Technologies and Design (2 Mala Shiianovska Str., Kyiv, 01011, Ukraine)
Email: [email protected]
Tarasenkо Iryna O. – Doctor of Sciences (Economics), Professor, Head of the Department, Department of Finance and Financial and Economic Security, Kyiv National University of Technologies and Design (2 Mala Shiianovska Str., Kyiv, 01011, Ukraine)
Email: [email protected]

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