Modern features of the strategic resources formation for managing the value of trading companies

Shevchenko Dmitry Aleksandrovich ORCID: 0000-0002-9758-4107 PhD in Economics Associate Professor, Dean, Faculty of Management, Southern Federal University 105/42 Bolshaya Sadovaya str., Rostov-On-Don, 344006, Russia dashevchenko@sfedu.ru Other publications by this author

Pribylov Vladislav Pavlovich Graduate student, Southern Federal University 344006, Russia, Rostov-On-Don, B.Sadovaya str., 105 vpribylov@sfedu.ru

Introduction

The study of the peculiarities of the formation and management of resources for the strategic development of companies, especially in the context of capital formation, is in the sphere of interests of many domestic and foreign scientists. While the cost parameters of optimizing the capital structure are well described and studied from the point of view of financial management, the issues of their alignment with the strategic cost approach to business management remain relevant and require more detailed analysis. On the one hand, the relevance of such a task statement is associated with the dynamic transformation of environmental factors, the consideration of which should be integrated into criteria and approaches to strategic management ^{[1, 2]}. On the other hand, the aspect of industry specifics remains insufficiently studied, objectively determining the specifics of needs, development prospects, conditions for attracting and formats for using strategic resources that affect the value of companies ^[3]. At the same time, the results of current foreign research in this area ^{[4, 5]} can only be used to a limited extent in modern conditions of the Russian economy.

Therefore, the purpose of the study was to empirically confirm the definition of the specifics of providing financial resources for the strategic development of trading companies in the Russian Federation. To study the sectoral features of the formation and use of capital for value management, both general research methods, including analysis, deduction, generalization, analogy, and economic and statistical methods, involving the identification of trends and dependencies based on empirical data, were used. By determining the dynamics of absolute and relative indicators of equity, long-term and short-term liabilities of enterprises in a particular industry, it is possible to form a general idea of the most common method of financing, the degree of dependence of enterprises on borrowed sources, and the prospects for forming a sustainable model for attracting resources to implement business development strategies.

Formation of the financial and resource base for strategic value management of the company

The logic of managing the company's value in the long term assumes the allocation of sources of formation and factors of value growth in the accepted system of coordinates and criteria for business efficiency. The content and features of various approaches to the implementation of the cost concept in the enterprise management system are well described and analyzed in the works of Russian and foreign economists ^{[6, 7, 8, 9]}. Financial security objectively plays one of the key roles in managing the value of companies, creating its fundamental resource base, which has the potential to reproduce in increasing volumes.

Optimizing the composition and structure of financing sources, making up the company's capital management policy, is a central element of the theory and practice of financial management, since it is associated with almost all economic processes and performance indicators of the enterprise. There are about fifteen generally recognized theoretical concepts that propose and justify various criteria for the optimality of an enterprise's capital structure ^[10]. The main indicators are the weighted average price of capital and the optimal level of financial leverage for the organization. The cost of raising capital should be minimal, allowing you to generate a sufficient amount of profit. The financial lever characterizing the share of borrowed funds in the company's capital has a multidirectional effect on return on equity and financial stability, which also requires a differentiated approach in making financial decisions: among other factors, it is necessary to take into account such factors as the characteristics of income sources, sectoral, territorial and structural features of the organization, cost and risk parameters of alternative financing options ^[11].

The problems of capital formation are related to determining the value of each of the possible sources of its formation, taking into account the specifics of using different instruments to attract debt and own financing. If traditionally the criterion for optimizing the capital structure is considered to be the ratio of the average cost of capital and the level of profitability of its use, taking into account the level of risks, then a number of additional conditions and restrictions should be introduced to implement a strategic approach to maximizing the value of the company. The analysis of existing publications and the generalization of practical experience allows us to identify the following significant aspects that should be taken into account when forming financial and resource support for the strategic development of companies in modern conditions.

Strategic development plans require expansion of the investment base, mobilization of internal or external sources of financing. Depending on the chosen form of financing, this is expressed in different proportions in an increase in the share of borrowed funds, an increase in owner contributions (an increase in equity), raising funds or reinvesting retained earnings in investment projects. Strategic development plans involving long payback periods for investments need to be supported by timely sources of financing. Depending on the timing, industry affiliation, scale and riskiness of the development program, different tools for attracting resources may have an advantage.

The possibilities of raising capital are fundamentally determined by the state and structure of the company's assets, which should currently be understood as broadly as possible. In the context of strategic business development plans, it is important to support development plans with the necessary innovative solutions, i.e. intellectual property objects that provide the necessary basis for competitive advantages and investment returns in the future. At the same time, the lack of funding is an obstacle both for the commercialization of existing innovative developments and for conducting their own innovation-oriented research ^[12]. Breakthrough development should be based on the latest intellectual property objects, however, the possibilities of long-term lending as the main form of attracting resources for the implementation of business development strategies traditionally rely more on the assessment of tangible assets available in the organization.

Borrowing is generally limited by the conditions of the current situation in the financial markets. Currently, a combination of external circumstances, accumulated problems of the financial system, as well as priorities and tasks of state economic policy form a unique situation for business of a counter-interested movement on the part of financial institutions and regulatory authorities. Banks, investment funds and specialized development institutions, implementing their own policies in a competitive environment, are focused on sustainable long-term partners, offering them comprehensive financial and settlement services and individualization of resource solutions, including cost parameters ^[13]. The state implements various programs of targeted business support, differentiated by industry, business scale, region, nature of technology, etc. ^[14] Examples of programs to support long-term strategic business projects are a special investment contract, VEB Project Financing Factory.the Russian Federation, Investment loans from SME Bank, Preferential loans to companies for digital transformation projects and the introduction of IT solutions, Direct investments of the RDIF, the Development Projects Program.

A notable factor in managing the resource provision of strategic development of companies is the decision-making system within the organization, characterized by a system of goals, priorities and constraints. In the Russian economy, for a number of reasons, many organizations, especially among small and medium-sized businesses, do not take strategic management seriously, tactical decisions have priority ^[15], which is explained by the high dynamics and mobility of the environment, the need and possibility of significant acceleration in information processing and decision-making.

The considered circumstances of resource management for strategic business development have features of manifestation and implementation depending on the sphere of economic activity. Therefore, generalizations and recommendations should be supported by an analysis of empirical data from a specific industry.

Dynamics and prospects of resource provision of value management in Russian trading companies

Traditionally, the publications of Russian economists have recorded the advantage of debt over equity in the financing structure of commercial enterprises ^{[16, 17]}, which is logically related to the availability of liquid reserves potentially used as collateral for loans.

Statistical data from the Federal State Statistics Service can be used to generalize the characteristics of financial and resource support for the development of trading companies. They include, in particular, the autonomy coefficient calculated in dynamics by type of economic activity, which characterizes the share of own funds in the balance sheet currency and, accordingly, the company's dependence on external sources of financing. Its values, of course, do not make it possible to assume preferred sources of financing for company development programs, therefore they will be supplemented by an analysis of the dynamics of sources of investment in fixed assets in order to form conclusions about the opportunities available in the sector.

A comparative analysis of the dynamics of the coefficient of autonomy of trade enterprises in general, wholesale and retail trade (Figure 1) shows a slow and insignificant increase in the share of equity in the capital of companies for the period from 2017 to 2022, as well as a noticeably lower value of this indicator in the retail sector. If, in general, for trade organizations, the coefficient of autonomy in the period under review ranged from 47.32 – 53.53, in wholesale trade from 49.74 to 55.53, in retail trade from 31.63 to 44.25 (Table 1). Moreover, the maximum values for all groups of enterprises are typical for 2022, which is due to the significant volatility of interest rates in the Russian lending market in 2022 – from March to June it was noticeably increased compared to previous periods, which also affected the availability of credit resources for commercial organizations. Thus, the increase in the share of own funds in the capital of trade organizations by the end of 2022 is explained more by external reasons than by the purposeful policy of companies.

Figure 1. Dynamics of the coefficient of autonomy of trade organizations in the Russian Federation, % (compiled by the authors according to ^[18])

Table 1. The coefficient of autonomy of trade organizations in the Russian Federation, % ^[18]

Focusing more on financing current activities secured by current assets than on long-term sources of financing, Russian trade enterprises name a lack of financial resources among the factors limiting their development, along with the level of competition, lack of demand and the tax system (Figure 2).

Figure 2. Factors limiting the development of retail trade organizations, % of companies that voted, April 2021, compiled by the authors according to ^[18]

The statistics of the Bank of Russia make it possible to estimate the change in the cost of credit resources of the banking sector for companies in the fields of economic activity, including specifically for trade organizations. As you can see in the graph (Figure 3), over the past five years, the sharpest fluctuations have been observed in short–term lending interest rates - from 6% in the summer of 2020 to 22% in the spring of 2022. Rates on long-term loans mostly repeat the trend, but change more smoothly, in accordance with the specifics of the terms of the concluded contracts. Since mid–2022, the rates on long-term loans to trade organizations - small and medium-sized businesses have been consistently higher than all other analyzed parameters, which was not so clearly expressed in previous periods. This indicates that there are objective limitations for attracting credit resources for the long-term development of trading enterprises.

Figure 3. Dynamics of weighted average interest rates on loans in rubles provided by credit institutions to wholesale and retail enterprises, including SMEs, % per annum (compiled by the authors according to ^[19])

Speaking about the financial sources of strategic development and increasing the value of business in the future, it is necessary to consider the structure of investments in fixed assets of companies, comparing it with the number and volume of financial needs of trade. In general, the main source of financing for investments in fixed assets in the country is now the mobilization of own funds – since 2015, their share has not decreased by less than 50%, and by the end of 2023 it amounted to 55.6%. The main part of the attracted resources are budgetary funds, their share is about 20% by the end of 2023, and the share of bank loans is less than 9%, which is clearly shown in Figure 4.

Figure 4. The structure of sources of investment in fixed assets in the Russian Federation, % (compiled by the authors according to ^[18])

The volume of investments in fixed assets in the wholesale and retail trade in 2022 amounted to 1099.5 billion rubles, which is 9.5% more than the previous year. Of the total investment in fixed assets in the country, this industry accounts for only 3.94%, while it accounts for about 25% of all organizations in the economy. It can be assumed that the contribution of trade organizations to real investments on the scale of the national economy is not large due to the fact that this type of activity is not sufficiently fund-intensive. At the same time, their investment activity is limited by the high cost of lending and inflationary expectations associated with the difficulties of forecasting demand and sales.  Currently, the most promising projects for the development of trade organizations can be considered projects on digitalization and automation, the formation of marketplaces, and improving the quality and speed of customer service. Technological advances form the key areas of strategic decisions in trade ^[20]. They should become the main drivers of value growth in this sector in the future, along with intellectual property objects and the implementation of differentiated growth strategies.

Discussion of the research results

Thus, the financial component of strategic cost management resources of trade organizations, which has traditional forms of own and borrowed funds, demonstrates the specifics in the priority mechanisms of their formation. In particular, based on the analysis of the dynamics of the autonomy coefficient, it was concluded that the role of debt financing in trade is generally decreasing. This does not correspond to the previously obtained conclusions and the results of the analysis of individual specialists who justified the priority of borrowed sources of resource base formation in trading companies ^{[16, 17]}.  Along with this, it is important to emphasize that, according to the Bank of Russia, the lack of financial resources, high level of competition and problems with effective demand, trade organizations consider the most significant factors limiting the implementation of strategic development plans ^[18]. The data considered in the paper confirm these limitations from the point of view of real statistics on the structure of financing development programs in this area.

Based on the analysis, it can be concluded that such a dynamic situation is related, on the one hand, to the current situation of the Russian financial market, the balance of supply and demand of capital. The high level of interest rates complicates access to credit facilities in trade without additional support and stimulation of investment activity from the state. It can be assumed that in industries with more pronounced support, a different structure of resource provision for strategic development is emerging, but this requires additional consideration. On the other hand, a strategic approach to cost management requires more consistent and comprehensive implementation in trading companies, often focused on a short-term planning horizon. This conclusion is consistent with the positions of the authors, who note this disadvantage as an obstacle in the implementation of the cost concept of business management ^[15]. At the same time, additional research approaches and methods should be used to substantiate the characteristics of real processes and decision-making criteria in trade organizations, in addition to analyzing generalized statistical data.

Further research directions

 The analysis showed that, taking into account mainly the low capital intensity and high turnover of the trading business, in the long term, the cost increase in it will be provided mainly through the mobilization of own resources, internal savings. For a steady increase in value, it is advisable to direct them to the commercialization of the innovative potential formed by companies, the development of unique technological advantages and services. This approach to the formation of strategic cost management resources, taking into account the reviewed publications and empirical data, seems to be the most reasonable. At the same time, the conclusions made allow us to outline further areas of research that are of significant practical importance from the point of view of the effectiveness of the formation and implementation of development strategies for companies in the field of trade. In particular, it is necessary to characterize the processes of developing and evaluating strategic alternatives within companies, taking into account their market position, scale of activity, ownership structure and other characteristics, in order to develop the most reasonable approaches to these processes. In addition, it is advisable to consider conceptually and on specific data the composition of other types of strategic resources necessary for the development and long-term increase in the value of trade organizations, since the financial component of resource security is naturally formed based on the limitations and parameters of the business, characteristics of its investment projects, forms and timing of their implementation. The issue of determining methods for evaluating the effectiveness of value management of trading companies remains to be further studied, especially in the context of justifying the uneven mobilization of external and internal resources for these purposes.