Working Capital Management On Performance Of Manufacturing Companies In Nigeria (A Study Of Nestle Nigeria Plc)

ABSTRACT

The research on working capital management on the performance of

manufacturing companies focused on Nestle Nigerian plc. The study made use of

secondary data, sourcing data from 2006 to 2017. The study adopted descriptive

research method regression model as its statistical technique. The study adopted

Return on Asset as its dependent variable. The independent variables include; cash

conversion cycle, account receivable turnover, accounts payable turnover and

inventory turnover. The findings revealed that account receivable turnover and

inventory turnover has a positive and insignificant effect on return on asset while

account payables turnover and cash conversion cycle has a positive and signflcant

effect on return on asset. The result conclude that for nestle plc, working capital

management with particular reference to Account payable turnover and cash

conversion cycle has a sign fIcant impact on performance. We recommend that

firms should manages cash conversion cycle by reducing the period between sales

of goods and recezt of cash from sales and also Nigeria firm should reduce heavy

investments in current assets to avoid inventory cost, lost returns, excess cash

holdings and receivables. Efficient management and financing of working capital

management can increase profitability and also financial manager should have

knowledge of the source of working cap ital funds.