Dealer Satisfaction

WORKING chapiter MANAGEMENT Introduction A unfaltering is required to maintain a balance between liquidity and advantageousness while conducting its daylight to day operations. Liquidity is a precondition to ensure that firms are able to gratify its short-term obligations and its continued flow can be guaranteed from a utile venture. The importance of cash as an indicator of continuing financial health should not be surprising in view of its crucial agency within the origin.This requires that business must be run both expeditiously and profitably. In the process, an asset-liability mismatch may occur which may increase firms profitability in the short run but at a risk of its insolvency. On the other hand, too much centering on liquidity will be at the expense of profitability and it is common to find finance textbooks begin their functional(a) peachy sections with a discussion of the risk and return tradeoffs inherent in alternative working(a) majuscule policies.Thus, the manager of a business entity is in a quandary of achieving desired tradeoff between liquidity and profitability in swan to maximize the value of a firm. Importance of Working Capital The working great meets the short-term financial requirements of a business enterprise. It is a vocation working capital, not retained in the business in a crabbed form for longer than a year. The money invested in it changes form and center field during the normal course of business operations.The need for maintaining an adequate working capital can hardly be questioned. Just as circulation of blood is actually necessary in the human body to maintain life, the flow of currency is very necessary to maintain business. If it becomes weak, the business can hardly win and survive. Working capital starvation is generally credited as a major cause if not the major cause of small business failure in many developed and developing countries. Objectives of Working CapitalIt is decorous more and more difficult to use debt to finance mechanical engineering science firms. Companies in this industry are therefore forced to optimize their capital utilise in order to become less dependent on borrowed money. Management of Working Capital While the performance levels of small businesses subscribe traditionally been attributed to general managerial factors such as manufacturing, marketing and operations, working capital management may have a consequent refer on small business survival and growth.The management of working capital is important to the financial health of businesses of all sizes. The amounts invested in working capital are often high in proportion to the total assets employed and so it is vital that these amounts are used in an efficient and in force(p) way. However, there is evidence that small businesses are not very level-headed at managing their working capital. Given that many small businesses suffer from downstairs capitalisation, the importance of exerting ti ght control over working capital investment is difficult to overstate