Thulsile P. Nkambule, Herrison Matsongoni, Emmanuel Mutambara
Grower firms in the Eswatini contribute to sugar production which is 59% of the country’s agricultural input. Sugar production contributes about US$285 million to the country’s Gross Domestic Product (GDP). This great contribution to the economy requires grower firms to ensure liquidity at all times through working capital management. Prior evidence has indicated a relationship between working capital and financial performance. Therefore, this study seeks to rethink the working capital and financial performance practices by assessing the working capital management and financial performance by using a population of 86 grower firms from the Big Bend Planters group for the period 2014 - 2018 using both primary and secondary data. Financial performance was measured in terms of profitability by return on assets and return on investment capital as dependent variables. The working capital management was determined by cash management, inventory management, accounts receivable management and accounts payable management as independent variables. Data collected was analyzed using the Statistical Package for Social Sciences (SPSS) version 20 with the mean, standard deviation, Pearson correlation analysis and regression analysis as statistical tools. The findings from the study indicated that there is a positive relationship between working capital management and financial performance of firms. To enhance profitability, firms need to effectively manage their working capital. The study concluded that businesses collapse due to the inefficient management of working capital, therefore financial managers should employ sound working capital management strategies to optimize financial performance.