Effects of Cash Conversion Cycle Management on the Performance of Food and Beverage Firms in Nigeria

Abstract

Despite the emphasis placed on cash conversion cycle management, in ensuring manufacturing firm profitability in Nigeria, the management is yet to come on the path of sound profitability and growth. The study examined the effect of cash conversion cycle management on financial performance of listed foods and beverage firms in Nigeria. The expofacto research design was adopted with reliance on secondary data from annual report of listed food and beverage firms. The purposive sampling techniques was employed in selecting the 15 firms out of 23 foods and beverage firms in Nigeria for 2011-2021 financial year. To carry out this objective three method of panel regression estimation was used which is fixed effect by Hausman test which was analyzed using E-views 10. The findings show that cash conversion cycle management has negative significant effect on return of asset. The study concludes that cash conversion cycle management does not contribute the growth of food and beverage firms in Nigeria. The study recommend that management of companies should not give due importance to cash conversion cycle management, and emphasize an optimal working capital level in their respective companies, because of the negative impact of cash conversion cycle on the financial performance on foods and beverage firms in Nigeria.