Optimizing working capital boosts profits for Ghanaian manufacturing firms.
The study looked at how managing working capital affects the profits of manufacturing companies in Ghana. They used data from 11 companies on the Ghana Stock Exchange from 2011 to 2017. The researchers found that there is a positive relationship between working capital management and profitability. They also discovered that there is an optimal level of working capital that maximizes a firm's profitability. This means that companies should make sure they have an effective working capital management policy in place to maximize their profits. Additionally, having an aggressive working capital management policy can also help increase a firm's profitability.