TITLE:
Financial Ratio and Efficiency Analysis as a Competitive Advantage of Wine Manufacturing Firms. The Case of Greece
AUTHORS:
Maria Tsiouni, Christos Konstantinidis, Alexandra Pavloudi, Nikolaos Giovanis
KEYWORDS:
Financial Ratios, Efficiency, Competitiveness, Wine Manufacturers Firms
JOURNAL NAME:
Theoretical Economics Letters,
Vol.12 No.1,
February
17,
2022
ABSTRACT: In the Greek economy, the wine industry is one of
the most important sectors, not just for the domestic beverage market, but also
for the development and promotion of Greek traditional products abroad. The
wine sector has been recognized as one of the most significant economic
activities in many countries, both in terms of employment and revenue.
Financial analysis is crucial to understanding the economic condition of wine
production companies and ensuring the sustainability of the industry. Financial
ratio analysis provides insights into the factors that determine economic
utility, which is increasing profitability, reducing risk, and providing
liquidity to economic entities. The main purpose of the paper is to examine and
analyze the financial situation of companies active in the wine industry. This
will evaluate how well they adapt to the changing market environment. By
analyzing the financial profile of the companies, an effort was made to
identify the problems that they faced as well as analyzed their efficiency.
Cluster analysis would be conducted in order to determine their level of competition.
According to the results, large companies were able to pay their current
liabilities, fixed costs, interest, dividends, as well as better handle any
current losses. The large companies have a
high level of solvency and display rapid circulation of their stocks. Small and medium-sized businesses had
difficulties meeting their current obligations as well as dealing with
potential losses. Indicators measuring the efficiency of the utilization of
assets in large and medium-sized enterprises were relatively stable, but a
significant over-investment of capital relative to sales could lead to
obligations not being met in the future. The debt to assets ratio of large
companies was higher than that of medium and small companies, which must be
addressed by increasing the firms’ liquidity to avoid debt service problems.