Analysis of Management Model and Financing Demand of Shanghai Technology-based SMEs

Abstract

At present, the development of Shanghai's Technology-based small and middle enterprises (SMEs) is severely constrained by financing difficulties. Due to the management model and its high-risk and high-input characteristics, it has hindered its financing, which greatly reduces the survival rate of SMEs. Therefore, such enterprises urgently need effective government support. Based on the principle of product life cycle, this paper analyzes the law of the management and development of SMEs, and points out the characteristics, development stages and faults of SMEs, and then analyze the difference between the management mode of SMEs and the staged differences in financing needs. Therefore, this paper proposes that the Shanghai government should start to solve the financing difficulties of SMEs from the following three aspects : direct investment, fiscal and taxation policies and financial support policies. The Shanghai government should provide targeted financial assistance for different stages of growth of the company, thereby greatly improving the development level of Shanghai's technology-based SMEs. Keywords—Technology-based SMEs, Life cycle, Financing requirement, Management model. I. CHARACTERISTICS OF TECHNOLOGY-BASED ENTERPRISES A. Limited Asset Size and Poor Mortgage Guarantee In the early stage of entrepreneurial development, technology-based enterprises often have problems of small economies and low total assets. Therefore, fixed assets or corporate movable assets that can be used for mortgages are very limited, especially those with high technology and new technologies[1]. It has less investment in property, due to the lack of fixed assets and collateral assets, and the extremely low credit level in the early stage of the venture. The lack of guarantees from credit guarantee companies narrows its financing channels, which makes the SMEs very difficult to obtain the funds needed through a large amount of mortgage. In addition, technology-based SMEs can choose mortgage guarantees or pledge guarantees, but both types of guarantees have complicated procedures and expensive expenses. The costs of various intermediate which links in the guarantee and mortgage process are not standardized. Wherever, it will increase the financing cost of the company.