Publicação
The impact of working capital management on profitability - a comparative analysis of German and Japanese automotive manufacturers
| Resumo: | This study investigates the impact of Working Capital Management (WCM) on profitability by analyzing six years of quarterly data of German and Japanese automotive manufacturers. Descriptive statistics and independent t-tests reveal significant country differences. Japanese companies follow a more aggressive WCM policy, expressed by a significantly lower Cash Conversion Cycle (CCC) and a higher Return on Assets (ROA) than German firms. The results of the correlation analysis and Ordinary Least Squares regressions stress the importance of WCM. Managers of automotive manufacturers can improve ROA by lowering CCC, Days Sales Outstanding, and the share of current assets on total assets. |
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| Autores principais: | Hack, Leonard Klaus |
| Assunto: | Cash conversion cycle Germany Working capital management Profitability Days inventory outstanding Days sales outstanding Days payable outstanding Covid-19 pandemic Japan Return on assets Automotive manufacturers |
| Ano: | 2023 |
| País: | Portugal |
| Tipo de documento: | dissertação de mestrado |
| Tipo de acesso: | acesso aberto |
| Instituição associada: | Universidade Nova de Lisboa |
| Idioma: | inglês |
| Origem: | Repositório Institucional da UNL |
| Resumo: | This study investigates the impact of Working Capital Management (WCM) on profitability by analyzing six years of quarterly data of German and Japanese automotive manufacturers. Descriptive statistics and independent t-tests reveal significant country differences. Japanese companies follow a more aggressive WCM policy, expressed by a significantly lower Cash Conversion Cycle (CCC) and a higher Return on Assets (ROA) than German firms. The results of the correlation analysis and Ordinary Least Squares regressions stress the importance of WCM. Managers of automotive manufacturers can improve ROA by lowering CCC, Days Sales Outstanding, and the share of current assets on total assets. |
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