Determinants of Working Capital in Consumer Non-Cyclicals Sector: An Empirical Study on LSE-listed Companies

Abstract

In the contemporary and ever-changing economic environment, the skillful administration of working capital has become a crucial factor for organizations, particularly in industries that demonstrate resilience in the face of economic swings. The sector of Consumer Non-Cyclicals, renowned for its stability, is an example of a domain in which working capital plays a vital role. This study aims to examine the various factors that have an impact on working capital within the Consumer Non-Cyclicals Sector, focusing specifically on companies that are publicly listed on the London Stock Exchange (LSE). The study emphasizes the importance of managing working capital, underscoring its role in preserving liquidity, promoting expansion, and guaranteeing operational effectiveness. The objective of this study is to analyze the factors that influence working capital decisions in these businesses, utilizing a combination of theoretical frameworks and empirical evidence. This study utilizes a panel dataset and develops empirical models to examine the potential influence of firm-specific variables on working capital. The outcomes of this research are anticipated to offer significant perspectives for the management of firms, investors, lawmakers, and other relevant stakeholders. These insights will benefit both academic research and practical implementations within the area.