The relationship between liquidity and profitability in the retail industry: evidence from Chinese listed firms

• Autor(a) principal: Morais, Francisco Fernandes Mota
• Data de Publicação: 2019
• Tipo de documento: Dissertação
• Idioma: eng
• Título da fonte: Repositório Científico de Acesso Aberto de Portugal (Repositórios Cientìficos)
• Texto Completo: http://hdl.handle.net/10362/69079
• topic: Liquidity; Profitability; China; Retail; Domínio/Área Científica::Ciências Sociais::Economia e Gestão

This paper clarifies the relationship between liquidity and profitability, in the retail industry, resorting to evidence from Chinese listed firms. The study extends the literature by providing a new perspective that relates cash flows with firms’ returns. Similarities and differences between store-based retailers and internet pure players are also addressed. According to the results, a positive relationship between liquidity and profitability exists in the Chinese retail industry. Moreover, internet pure players present lower returns when compared to store-based retailers. Managers can, therefore, improve retail firms’ profitability through effective liquidity management, mainly acting via suppliers’ payment period and operating cash flows.