Chan, J K W; Tam, C M and Cheung, R K C (2005) Construction firms at the crossroads in Hong Kong: Going insolvency or seeking opportunity. Engineering, Construction and Architectural Management, 12(2), pp. 111-124. ISSN 0969-9988
Abstract
Purpose – To assist contractors in Hong Kong to review their past financial performance and to formulate new strategies for their business survival in the coming years. Design/methodology/approach – The financial accounting ratios and distress scoring are very useful tools to measure the financial performance. These tools are also useful to compare the performance among themselves and over the years. The mathematical analysis together with a review of the current business environment and the characteristics of construction industry will assist contractors in Hong Kong to formulate new strategies for their own business survival in the coming years. Findings – The results have shown that the financial performance of most contractors in Hong Kong have been deteriorating very fast in the past few years. The results of all financial ratios, together with the prevailing situation of over competition, inelasticity of construction costs and reduced aggregate demand in Hong Kong, has revealed the extreme difficulty of reversing the financial performance in the coming years. Originality/value – Contractors in Hong Kong now understand that their own financial performance have been deteriorating to an alarming limit. There is an urgent need to review their business environment and to formulate new corporate strategies.
| Item Type: | Article |
|---|---|
| Uncontrolled Keywords: | construction industry; financial performance; Hong Kong |
| Index terms: | aggregate, construction cost, Hong Kong, distress, corporate strategy, construction industry, survival, strategy, construction firm, financial accounting, insolvency, financial ratio, mathematical analysis, financial performance, methodology, competition |
| Subjects: | materials science, business, organization, environmental science, data analysis and analytics, financial and cost management, economic analysis, Geography, professional development, management, structural engineering, business analysis, research methods, industry analysis, liability law, market analysis |
| Topics: | Information Management, Engineering Principles, Geographical Context, Research Practice, Cost Management, Business Strategy, Governance, Sustainability, Legal Issues |
| Descriptive scope: | 3 PCT |
N.B. Descriptive scope is a count of how many of the five facets of empirical research are indicated by the words used in title, abstract and keywords. It is not intended as a judgement on the research; merely a count of the kind of word we would expect to indicate Phenomenon, Concepts, Theoretical framing, Empirical techniques, Analytical techniques. If all five are present, then a code of “5 PCTEA” will indicate this. If you feel the coding for this record is questionable, we welcome discussion around the terms we matched or the way we categorized them. The facet you would expect may not be coded, or a facet may be coded inappropriately. This can also bear on a larger question, of which facets should be treated as defining in construction management research. Please get in touch, and we will look at it. More details here