Author(s)

Tao Hua

Corresponding Author

Tao Hua

Abstract

As the first manufacturer of fully automatic washing machines in China, Wuxi Little Swan Company Limited has been leading the development of washing machine industry in China. Faced with the increasingly white-hot washing machine industry, company implemented a series of major reforms in 2012, among which the “T+3” customer order system production and marketing mode promoted by company has dramatically shortened the supply cycle and accelerated the speed of capital turnover and attracted extensive attention from the industry. This paper selected the 2010 to 2017 financial data of Shenzhen Stock Exchange with the year 2012 as the demarcation point. The paper analyzes the company's inventory turnover rate, accounts receivable turnover rate and cash flow rate to explore the impact of the “T+3” model on working capital. At the same time, the relevant indicators of Little Swan's working capital are compared with Qingdao Haier Company Limited, the industry benchmarking company, to sum up the reason for the success of this model is that it can effectively destock and compress the supply cycle. Suggestions such as strengthening supplier management, improving production speed, and optimizing inventory management are proposed for the development of the washing machine industry, which hopes to provide certain reference significance for the development of the washing machine industry.

Keywords

Washing machine industry, “T+3” model, working capital