Trends and Conditions for the Formation of Profitability of Agricultural Enterprises: A Case Study of Lviv Region, Ukraine

Abstract

In the article we investigate the problem of determining the main factors of increasing the profitability of agricultural enterprises in order to effectively use the resource potential of agricultural producers. In this study, we used a set of modern scientific methods, among which we highlight such methods as factor analysis, structural analysis, graphical and tabular methods, grouping methods, regression statistical analysis, etc. In particular, grouping methods are used in the study for the distribution of the researched enterprise’s totality according to the special features of their functioning. Also in the process of our study regression, a statistical analysis method was used to build a regression model to assess the relationship of profit and revenue from agricultural enterprises with such factors as a capital ratio, the average annual amount of enterprise assets, the labour costs, and the number of material costs per unit of land area. Besides, in order to study the level of profitability of agricultural enterprises in terms of their organizational and legal forms of management, the scope of financial and economic activities as well as the unit of the occupied area, livestock and taking into account the products produced, we used the structural analysis method. According to the results of the study, we found that the profitability of agricultural enterprises in the Lviv region of Ukraine depends on the characteristics of their versatility. Thus, according to the results of the study we proved, that the constructed multifactorial correlation and regression models allow us to make the conclusion about availability of the significant impact on the profitability of the security of the agricultural enterprises in Lviv region of Ukraine and the level of their intensification of the production activities. Based on the study, it can be argued that the profit of agricultural enterprises is a key indicator for the implementation of the process of agricultural production, and is one of the main criteria for the effectiveness of the agricultural sector. It is determined that the activity of agricultural enterprises is significantly influenced by external factors that are not directly related to the production activities of enterprises.