Working Capital Management and Business Performance: A Study of Malaysian Small and Medium-Sized Family Enterprises

Small and medium-sized enterprises (SMEs) in Perak, particularly family businesses, play a crucial role in contributing to the state's economy. Hence, this study examines the correlation between working capital management and business performance in Perak SME family businesses. A quantitative research approach was employed, and data were collected from 368 SME family businesses in Perak using simple random sampling techniques. Pearson correlation analyses were conducted using SPSS v.26. The results revealed a significant positive correlation (r = 0.494, p < 0.05) between working capital management and business performance, indicating that effective working capital management practices contribute to improved business performance in Perak SMEs family businesses. In conclusion, implementing working capital management in Perak SME family businesses is crucial for increasing business performance. This study recommends that businesses delve deeper into the dynamics of working capital management within Perak SME family businesses.