The study results revealed that the behavioral pattern of creditors matured during the COVID-19 pandemic period and the bargaining power that exists in the supply chain system has shifted from the corporate buyer to the supplier.
Authors
Ubais Parayil, University of Technology and Applied Sciences, Sultanate of Oman.
Lenin Kumar Nooney, University of Technology and Applied Sciences, Sultanate of Oman.
Sobhith Mathew Jose, Lecturer, Jindal Global Business School, O.P. Jindal Global University, Sonipat, Haryana, India.
Sibi Abraham Chacho, University of Technology and Applied Sciences, Sultanate of Oman.
Summary
Managing working capital is an all-time crucial managerial decision that has a direct impact on the financial performance of all businesses irrespective of size and regardless of economic condition. However, the management of operational capital during times of economic disruptions has received meager scholarly attention. Hence, the current study has tried to explore the working capital management practice followed by small and medium-sized enterprises (SMEs) in India during the COVID-19 pandemic period.
The study followed a qualitative methodology and interviewed 18 SME owners from India and found that the changes happened among the working capital components during that period. The study results revealed that the behavioral pattern of creditors matured and the bargaining power that exists in the supply chain system has shifted from the corporate buyer to the supplier.
The study result pointed out that it is highly advisable for SME owners to adopt a balanced approach toward working capital policy during times of vexation rather than moving toward a conservative or aggressive approach. In addition, practical implications and directions for future research attempts are also discussed.
Published in: Journal of the International Council for Small Business
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