THE IMPACT OF WORKING CAPITAL MANAGEMENT ON SME PROFITABILITY – EVIDENCE FROM KOSOVO

The study attempts to show the impact of working capital management on profitability ninety-eight Kosovo-based SMEs, primarily in manufacturing and construction sectors. data were obtained from financial statements these companies for years 2010 through 2020, assumptions verified using Ordinary least square (OLS) method. To express SMEs profitability, return assets (ROA) is taken as a dependent variable, while management, independent variables are taken: inventory turnover period (INTP), receivables collection (TRCP), trade payable (TPP), cash conversion cycle (CCC). In addition, four control (size companies, current ratio, sustainable growth, leverage), which not variable interest but could influence outcomes. results reveal that increase by decreasing INTP increasing TRCP, TPP, CCC. By analyzing effect context Kosovo, this research contributes new knowledge existing literature.