Working capital management as a factor of competitiveness in micro and small enterprises

International Journal of Development Research

Volume: 
12
Article ID: 
25899
6 pages
Research Article

Working capital management as a factor of competitiveness in micro and small enterprises

Antonio Oliveira de Carvalho and Rafael Cabral Vasconcelos

Abstract: 

Financial management presents numerous tools for efficient working capital management, which, when familiar and correctly used, can contribute towards increasing liquidity, rendering the enterprise more profitable and competitive. This paper discusses, through a theoretical essay, the relationship between working capital management and competitiveness of micro and small enterprises. In order to remain competitive in a globalized market, micro and small enterprises need, beyond keeping strict controlof their costs and prices, an efficient working capital management, in order to reduce costs, thus enabling the enterprise to become increasingly competitive. Knowledge in the financial area can be very useful to face difficulties and increase competitiveness of enterprises, once it allows a reduction of investment in working capital, which can be directed towards innovation and technology. Improved working capital managements will contribute towards increasing competitiveness and longevity of micro and small enterprises.

DOI: 
https://doi.org/10.37118/ijdr.25899.12.2022
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