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

Stanić Milan (), Cita Melita () and Šulentić Marina Stanić ()
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Stanić Milan: 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: PhD, Senior Lecturer, VERN’ University, Croatia
Šulentić Marina Stanić: PhD Student, Assistant, University of Slavonski Brod, The Department of Social Sciences and Humanities, Department of Economics, Croatia

South East European Journal of Economics and Business, 2023, vol. 18, issue 2, 126-139

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.

Keywords: working capital management; profitability; Croatian manufacturing enterprises (search for similar items in EconPapers)
JEL-codes: G32 G39 (search for similar items in EconPapers)
Date: 2023
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Persistent link: https://EconPapers.repec.org/RePEc:vrs:seejeb:v:18:y:2023:i:2:p:126-139:n:2

DOI: 10.2478/jeb-2023-0023

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