What Factors Cause Financial Difficulties in Retail Companies?

DOI

10.2991/aebmr.k.201116.042How to use a DOI?

Keywords

retails, financial distress, operational aspects, macroeconomic factors, logistic regression

Abstract

Retail companies are currently facing technological advancements that have resulted in a shift in how people shop from offline to online shopping. The trend of shifting public shopping at malls to shopping on online sites has resulted in many retail companies closing. This phenomenon will lead to company’s financial distress. The aim of this research is to determine factors which cause the company’s financial difficulties, which is represented by the ICR (Interest Coverage Ratio), variable which shows the company’s ability to pay interest, owned by the retail company where listed on Indonesia Stock Exchange (IDX) period 2014-2017. This ability is influenced by several factors, both internal and external factors. The company’s internal factors focus on the operational aspects of the company proxied by current ratio (CR), quick ratio (QR), debt ratio (DR), debt equity ratio (DER), and return on equity (ROE). External factors that are assumed to be the cause of companies experiencing financial difficulties are macroeconomic factors, which are measured by economic growth and inflation. The type of this research is quantitative research methods, data sources are taken from official sources that have been published and the analysis technique is logistic regression. The result of this research indicate debt ratio influences positive significantly and return on equity influences negative significantly to interest coverage ratio.

Copyright

© 2020, the Authors. Published by Atlantis Press.

Open Access

This is an open access article distributed under the CC BY-NC license (http://creativecommons.org/licenses/by-nc/4.0/).

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TY  - CONF
AU  - Sri Sulasmiyati
PY  - 2020
DA  - 2020/11/17
TI  - What Factors Cause Financial Difficulties in Retail Companies?
BT  - Proceedings of the 2nd Annual International Conference on Business and Public Administration (AICoBPA 2019)
PB  - Atlantis Press
SP  - 210
EP  - 214
SN  - 2352-5428
UR  - https://doi.org/10.2991/aebmr.k.201116.042
DO  - 10.2991/aebmr.k.201116.042
ID  - Sulasmiyati2020
ER  -