Measuring Financial Efficiency and Its Impact on the Firm's Financial Performance

This study explores the relationship between financial efficiency, capital structure, and firm performance in a manufacturing firm, emphasizing the need for optimized financial management in competitive industrial environments. As firms strive for sustainability and growth, understanding how internal financial metrics influence overall performance becomes increasingly important. The research focuses on key indicators such as cost efficiency, capital utilization, investment efficiency, and liquidity management, along with capitalstructure variables, to assess their impact on firm performance. Using five years of secondary data extracted from annual reports, the study employs tools like SPSS, Excel, and Frontier Analyst (DEA – BCC Model) to conduct correlation and regression analysis, trend forecasting, and efficiency measurement. The aim is to provide actionable insights for managers and stakeholders seeking to enhance financial health and strategic decision-making. By identifying the financial drivers of performance, this research contributes to thebroader understanding of how efficiency and capital structuring influence a firm's success in a dynamic market landscape. The findings are expected to guide future strategies in financial planning and performance optimization in manufacturing firms.