study aimed at critically analyzing the impact of working capital management to
the productivity of a manufacturing company. It is aimed as finding what impact
working capital management has on the profitability of manufacturing company.
The highlights of this research project address such critical issue on how a
proper management of working capital can prove profitability of manufacturing
TABLE OF CONTENTS
Table of content
Background of the study
Statement of the problems
Objective of the study
Significance of the study
Limitation of the study
Definitions of terms
2.0 Literature review
The nature of
Classification of working capital
Cash management and cash control
Management of account receivables and it relevance of
Goals of credit management.
Benefit of credit expansion
Stock management techniques
Impact of working capital management in industries
3.0 Research methodology
Population of the study
Sample and sampling techniques
Method of data collection
Sources of data
Data analysis techniques
Administration of questionnaire
Validation of the instrument
Reliability of the instrument
4.0 Presentation, analysis
interpretation of data
Table 1 Sex of respondents
4.3 Table 2 Marital status of respondents
4.4 Table 3 by age of respondents
4.5 Table 4 by education qualification of
4.6 Table 5 the past management administered the company
5.0 Summary, Conclusion and Recommendation
1.1 BACKGROUND OF THE STUDY
Business organizations exist in a rapidly changing environment which
threatens their survival. Many of them have adopted various survival strategies
to maintain substance. Hence, this has become the central philosophy of most
business concern for a business to survival, it must make sustained profit so
as to experience growth and meet its obligation when they fall due and ensure
that the company does not run of working capital management and its effect on
the portability of manufacturing companies. Its aim is to bring focus of this work,
which borders on the importance of working capital management and its effect on
the profitability of manufacturing companies.
manufacturing companies have been making tremendous effort capital. This
primary is reposed on adequate recognition by financial experts of the
importance of maintaining an optimum level of working capital and also obviates
the claim that greater importance is attached to profitability than the
management of working capital.
refers to the firm’s commitment in current assets. Current assets are made up
of cash and near items like debtors, stock, marketable securities etc. in other
words they are assets which are immediately convertible into cash or can be
converted within a short period of say one year. The above description refers
to the gross working capital. On the other hand, net working capital refers to
the total current liabilities
1.2 STATEMENT OF THE PROBLEM
It is an obviously truth that working capital management is a global one, there is a problem confronting
both big and small entities, even the government is involved in this great
The problem at stake is to identify
the difficulties encountered by a manufacturing company on realizing that
profit is made at the expenses of running an efficient would be analyzed, the
identified problems and useful suggestion offered.
1.3 RESEARCH QUESTION
Is there any relationship between working capital
management and profitability?
Is there increasing inefficiencies in the management of
Should a manufacturing company make merit at the
expense of effective working capital management?
Does effective working capital management increase
Does ineffective management of working capital entail
absence of profitability?
OBJECTIVE OF THE STUDY
The most important
objective of this study is to find out or point out a good cashier in
manufacturing company so as to achieve their need
To identify or to point out good cashier in
To advice the management of manufacturing companies on
how to increase there profit rate of growth.
To increase general employment opportunities.
Finding out the
general impact working capital will have on the productivity and profitability
of manufacturing companies.
OF THE STUDY
It is significance
because at any time, management of a business should i.e. in a position to pay
its debts as they arise and in addition to take advantage of such business
opportunities as reasonably visualized.
The importance of this study includes:
The achieve their aim of development
through the establishment of management of a manufacturing company rather than
dependence on heavy and dependence on imported raw materials, machinery and
spare parts which constitutes major sources of foreign leakage.
is in the light of those chances the continues research in the finance of
working capital management and profitability of a manufacturing company.
this research would also be an invaluable tool for students, academic staff or
tertiary and higher institutions, corporate managers, small scale and big
manufacturing companies and individuals who wants to know more about the effect
of working capital on the profitability of manufacturing companies
LIMITATION OF THE STUDY
This research work is
not without limitation, these limitations can be broadly classified under three
Under the human limitations, the attitude
of some of the respondent is nothing to write home about, some of them were so
doubtful that they would not wait to release any form of information to the
researcher. Time also played of role the research being a final ND student had
a lot of work to do within the sort semester.
This has to do with an organization current financial position and more
especially with its ability to pay its debts or meet up its obligation ads they
This is the ability of business to meet financial obligation at any time even
in the long run when all asset are converted to cash.
This is the value of all items own by the business inducing borrowed fund and
proprietor equity contribution or net.
This are the value of all items owned to the business e.g. credit and equity
Equity or Net Worth: This is the values of
assets contribute by all debtor of the business.