Bewertung des Arabian Journal of Business and Management

A New Approach Factor- Entropy Analysis Method Application to Business Costs in SMEs of Shanghai Model

Abstract

Guo Yan

The purpose of this paper is effectively resolving the issue of simplification and assignment evaluation index system on business costs of Small and Medium Enterprises (SMEs) in Shanghai. We try to use factor analysis to interpret the data on indicators and considering objective empowerment with entropy method. We show that combination factor analysis and entropy method to evaluate business cost for SMEs has advantages. We make an empirical analysis using of a sample of 36 SMEs in shanghai. Finally, we show that Factor-Entropy analysis method is an objective evaluation method, which indicators can reflect and explain scientific phenomena. We find that proposals to help developing of SMEs and manage business costs.