EFFECT OF WORKING CAPITAL MANAGEMENT ON THE PERFROMANCE OF MANUFACTURING ORGANISATION IN NIGERIA (A STUDY OF SELECTED MANUFACTURING FIRMS)
Abstract
The study, undertaken over a six-year period from 2019 to 2023, examined the outflow effects of working capital management on profitability in Nigeria's manufacturing sector. Its purposes were to ascertain the influence of average collections period, payments period, and cash conversion cycle on profitability at Guinness Nigeria Plc. The descriptive study was mostly dependent upon secondary sources of information. Regression and correlation analyses were performed to relate working capital and financial performance. The study found that the earnings of Guinness Nigeria Plc were adversely affected by average collection times, while the other two variables contributed significantly to profitability and thus confirmed the study's hypothesis that manufacturing firms, by managing all components of working capital, can increase profitability for their firms and their shareholders. In the conclusion of this study, the managers should ensure that credit collection is undertaken efficiently in the organization as well as payments to creditors not delayed beyond the agreed terms.
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