Working Capital Management Cycle and Profitability of Household Supermarkets in Kenya: A Literature Review

Alice Ruguru Ngari and Charles Kamau
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Alice Ruguru Ngari: Postgraduate Student at Mt. Kenya University, Kenya

International Journal of Research and Innovation in Social Science, 2021, vol. 05, issue 08, 711-714

Abstract: Working capital management involves management of short-term assets and liabilities. The purpose of this study was to examine the working capital management cycle in relation to profitability of household supermarket in Kenya. The objectives of the study were to evaluate the receivable conversion period, payable Deferral period, and inventory conversion period on the profitability of Household supermarket in Kenya. This study was guided by Operating Cycle Theory. The study used literature review methodology. The research concluded that firms that manage working capital efficiently enjoy the benefit of long survival in business, and that shareholders’ value can be raised by reducing account receivable days, by hiking stocks to a sensible level, by taking long to pay suppliers yet ensuring good terms and by minimizing the CCC days.

Date: 2021
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