Models of efficiency of functioning in trading enterprises under conditions of economic growth

The article examines the models of efficient functioning of trading enterprises in the conditions of economic development during 2016-2019. It is proved that the criterion for measuring efficiency is the evaluation of static and dynamic efficiency of trade activities, which allows changes in the used assets (resources) to be taken into account, an enterprise’s safety margin to be increased and it testifies to the merger (integration) of diminishing returns and economic fluctuations in modern economic macro and microsystems. The results of measuring the efficiency of trading enterprises’ activity show that in order to evaluate the efficiency of the functioning of trading enterprises qualitatively and completely, it is necessary to consider all possible factors. Given the existence of Clark’s law, the authors substantiate an approach to evaluating the performance based on simple one-factor multiple models, which proves that future studies of finding ways to improve the efficiency, which are mainly aimed at extensive resource changes, will be erroneous, unjustified, and most likely, they will reduce the effectiveness of the resource under study. By specifying and parameterising the function of an enterprise’s trade activity in the conditions of economic development, it is possible to evaluate not only the static efficiency of trade activity, but also the impact of the law of diminishing marginal product on the results of the enterprise’s operation. This approach allows us to determine the optimal boundaries of doing business and the most effective marginal size of resource changes to achieve high cost indicators and economic synergy. The article defines clear boundaries between the minimum marginal product ratio (increase in net income relative to the growth in the number of employees) and the maximum average product (productivity) of trading enterprises

Models of efficiency of functioning in trading enterprises under conditions of economic growth

The socio-economic situation in Ukraine suggests that there is insufficient research into the applicability of the model of economic development in forecasting the economic environment in which trade enterprises function. Researchers into issues relating to the efficiency of enterprises’ functioning focus their interest on comprehensively describing efficiency indicators and determining the factors influencing it. There continues to be insufficient work on measuring efficiency and the extent to which it is limited by types of economic growth (development), based on the theory of marginal product of George Clark and the results of multiple models of production and trade functions (P. Douglas, R. Solow, E. Denison, Harrod, Samuelson-Hicks, Domar and others). Therefore, this study focuses on the process of assessing the effectiveness of trading enterprises in the trade sector in 2010–18 in conditions of economic growth and an economic downturn. This article aims to examine the models of efficient functioning of trading enterprises in conditions of economic growth. It is evidenced that the criterion for measuring efficiency is the evaluation of static and dynamic efficiency of trade activities, which allows changes in the used assets to be taken into account and testifies to the integration of diminishing returns and economic fluctuations in macro and microsystems. The article shows that in order to qualitatively and completely evaluate the efficiency of the functioning of trading enterprises, it is necessary to consider all possible factors. According to Clark's law, the authors substantiate an approach to evaluating performance based on simple one-factor models; the approach evidences that future studies seeking ways to improve efficiency, but that focus on changes in resources, will be erroneous, unjustified, and will most likely reduce the effectiveness of the resource under study. This model will help: determine and forecast the efficiency of enterprises at any point in the economic cycle; provide the necessary information on the required amount of investment, on depreciation rates, and on the optimal amount of labour potential of an enterprise; and define the volume of expected income during economic crisis or recovery. Some applied recommendations in terms of managing the efficiency of trading enterprises are aimed at solving the methodological problem of constructing isoquant maps for a particular product line group and at selecting the optimal predictor for forecasting trade processes. The practical value of the proposed model also lies in improving the parameters of positioning of the enterprise's goods in target market segments, reducing operating costs, accelerating the turnover of inventories and withdrawing illiquid current assets, and increasing the efficiency of retail areas