CONTRIBUTION OF WORKING CAPITAL MANAGEMENT TO THE FINANCIAL PERFORMANCE OF MANUFACTURING BUSINESS IN RWANDA CASE OF BRALIRWA PLC KIGALI BRANCH (2020-2023

Abstract

The main objective of this research was to determine the contribution of working capital management to the financial performance of manufacturing businesses in Rwanda ,to analyze the effectiveness of working capital management in Bralirwa,to assess the contribution of working capital management to the financial performance of Bralirwa, Bralirwa manages effectively its working capital, Working Capital Management contributes positively to financial performance of Bralirwa. The study was beneficial to the researcher as it increased the knowlege on working capital management and the financial performance of manufacturing company in Rwanda, scientifically, this study was serve as a reference to others in carrying out their research and other businesses, the findings of the study was very important to decision making in their respective busnesses. The industry was obtained information about working capital management and its correlation with company’s performance and this information will particularly be important and useful to future investors in the industry and the senior management. For the purposes of this study; the researcher adopted a descriptive research design., the researcher collected data and information on the subject using the documentary. In this study, the data were analyzed using the analytical method, comparative method and statistical method. Through SPSS the data collected were transformed into meaningful information for easy interpretation and understanding. From the findings in the table 4.10 the value of adjusted R squared (co-efficient of determination) was 0.826 as an indication that there was variation of 82.6% on performance of companies due the contribution of working capital management at 95% confidence interval. This shows that 82.6% the improvement of performance of Bralirwa PLC was due to the effort made on the effective working capital management. The study also established that there is strong positive relationship between working capital management and performance of Bralirwa PLC as shown by correlation coefficient of 0.919. researcher have confirmed the first hypothesis” Bralirwa manages effectively its working capital”.In general total asset tunover of Bralirwa PLC has good results in sales because four years because in 82.7% in 2020 , 78.9% in 2021 , 106.1% in 2022 and 101.0 in 2023, in this way investment in total asset in Bralirwa PLC is efficiently. The factors which increase this ratio are many like motivated employees, big market for the company and low competition but the effective human resource motivation applied by Bralirwa PLC has played an important role whereby employees work closely with human resource management who advise the management of Bralirwa PLC. This shows that due to the advices from working capital led to the increase of profits in Bralirwa. researcher have confirmed the first hypothesis” Working Capital Management contributes positively to financial performance of Bralirwa”.