This paper aims to empirically investigate the effects of various components of net working capital on the profitability of European firms in the retail industry. A balanced panel sample of 19 retail companies listed on Euronext was selected over a period of six years, from 2016 to 2021 to assess the relationship. Results indicate that profitability and inventory turnover in days have a significant positive relationship, while the average collection period has a significant negative relationship. Therefore, if these retail enterprises effectively manage the cash conversion cycle and maintain optimal levels of accounts receivables and inventories, their profitability will increase. This paper provides two recommendations for practitioners. First, the retail companies’ management should lower the number of days’ account receivable, which increases the actual profit and consequently increase profitability. Second, the company should keep a reasonably large inventory level to lower the risk of product scarcity and to cut expenses when prices are fluctuating, both of which lead to higher profitability.
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This paper focuses on the specifics of the relationships between social entrepreneurs and local civil servants and politicians in The Netherlands. Policy frameworks for social enterprises (SE) are relatively underdeveloped here, as the central government took little initiative in policy development, and a legal definition for SE is lacking. This poses problems, but it also opens up possibilities to develop dialogue between local government and social entrepreneurs “bottom-up”.Both parties’ views of each other are explored, a practical tool to open dialogue is introduced and eight examples of collaboration are discussed.Through the collected experiences at local and regional levels, policy makers at the national level now also increasingly recognize the importance of SEs in the Dutch economy, and realize that the lack of national policy and legal frameworks has proven limiting and increased vulnerability of the sector. For the coming years, there are signs that policy support for SEs will become more structured and national policy action is likely.
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