The Relationship Between Working Capital Management Practices and Sustainability Among Barangay Micro Business Enterprises

This study examined the relationship between working capital management practices and sustainability among 105 Barangay Micro Business Enterprises (BMBEs) in Aleosan, Cotabato, using a descriptive-correlational research design. Results revealed that most BMBEs (63.8%) have operated for 1–5 years, with 72.4% engaged in merchandising and 100% operating as sole proprietorships. The overall level of working capital management practices was high (M = 3.51, SD = 1.05), with strong cash management (M = 3.71) and inventory management (M = 3.62), but moderate accounts receivable management (M = 3.20). Sustainability was also high (M = 4.15), with social (M = 4.53) and environmental (M = 4.15) aspects rated higher than economic sustainability (M = 3.76). Statistical analysis revealed a significant positive correlation between working capital management and sustainability (r = 0.541, p < 0.01), with results indicating that working capital management explains 29.3% of the variance in sustainability (R² = 0.293, F = 12.168, p = 0.000). The study concludes that adequate cash, inventory, and receivable management practices significantly enhance BMBE sustainability. Findings underscore the need for financial literacy programs and local government support to strengthen working capital systems, improve financial resilience, and promote sustainable enterprise growth.