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The Influence of Working Capital Management on the Profitability of Manufacturing Enterprises - The Case of Croatia

Author

Listed:
  • Stanić Milan

    (1 PhD, Assistant Professor, University of Slavonski Brod, The Department of Social Sciences and Humanities, Department of Economics, Adress: Matije Gupca 24, 35 000 Slavonski Brod, Croatia)

  • Cita Melita

    (2 PhD, Senior Lecturer, VERN’ University, Croatia)

  • Šulentić Marina Stanić

    (3 PhD Student, Assistant, University of Slavonski Brod, The Department of Social Sciences and Humanities, Department of Economics, Croatia)

Abstract

The aim of this research is to examine the relationship between working capital management and the profitability of Croatian manufacturing enterprises and to provide empirical evidence on the effects of working capital management on the level of profitability of manufacturing enterprises in the Republic of Croatia in the period from 2018 to 2021. The collected data were analyzed through multiple regression analysis, using a panel regression model with random effects. By analyzing panel data, the impact of receivables from customers, inventories, liabilities to suppliers, sales growth and GDP growth on the profitability of Croatian manufacturing companies was examined. The analysis of panel data examined the impact of trade receivables, inventories, payables, sales growth and GDP growth on the profitability of Croatian manufacturing enterprises. The obtained results also suggest that the variables the days sales outstanding, the days inventory outstanding and GDP growth are not statistically significant.

Suggested Citation

  • Stanić Milan & Cita Melita & Šulentić Marina Stanić, 2023. "The Influence of Working Capital Management on the Profitability of Manufacturing Enterprises - The Case of Croatia," South East European Journal of Economics and Business, Sciendo, vol. 18(2), pages 126-139, December.
    • Handle: RePEc:vrs:seejeb:v:18:y:2023:i:2:p:126-139:n:2
    DOI: 10.2478/jeb-2023-0023
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    References listed on IDEAS

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    More about this item

    Keywords

    working capital management; profitability; Croatian manufacturing enterprises;
    All these keywords.

    JEL classification:

    • G32 - Financial Economics - - Corporate Finance and Governance - - - Financing Policy; Financial Risk and Risk Management; Capital and Ownership Structure; Value of Firms; Goodwill
    • G39 - Financial Economics - - Corporate Finance and Governance - - - Other

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