Year: 2025
Type: article
Abstract: The management of a company’s working capital is of great importance in the current scenario, especially because of its impact on operationalefficiency. Business sustainability can only be achieved by organizations that maintain a balance between profitability and liquidity. Thepurpose of this research was to examine its impact on the performance of microenterprises engaged in wholesale and retail activities in Ecuador.To this end, secondary data from 1,634 companies registered with the Superintendency of Companies, Securities, and Insurance for the year 2023were used. Through a statistical prediction technique, it was possible to identify the elements of working capital that are associated with theperformance of the selected firms. The results show that variables such as leverage, company age, equity strength, and operating profitabilityhave a positive relationship with profitability. In contrast, the average collection period and asset turnover did not reflect significant effects, whilehigher customer turnover was negatively associated with financial performance. These findings show that efficient management of the elementsthat make up working capital favors not only profitability but also stability and the creation of business value. In a competitive environment withlimited access to financing, these practices are crucial for strengthening the permanence of microenterprises in the Ecuadorian business structure.
Source: Retos
Language: English
Subfield: Accounting
Domain: Social Sciences
Open Access status: diamond
OpenAlex ID: W4414575158