MJAAR

Influence of Financial Management Practices on Business Sustainability of Manufacturing Firms in Kawempe Division, Kampala, Uganda

Namayanja Diana, Zikusooka Enock


Abstract

This study examined the influence of financial management practices on the business sustainability of manufacturing firms in Kawempe Division, Kampala, Uganda. Sound financial management is widely regarded as essential to the survival and sustainability of enterprises, particularly capital-intensive manufacturing firms, yet its contribution among Ugandan manufacturers remains under-examined. The study investigated how working capital management, financial planning, record keeping, and investment decisions relate to business sustainability. A cross-sectional survey design with a mixed-methods approach was adopted, and data were collected from 175 respondents comprising firm owners, managers, and finance staff using structured questionnaires and interviews. Descriptive statistics, exploratory factor analysis, Pearson correlation, and structural (path) analysis were used. Factor analysis confirmed the construct validity of the financial management dimensions, which loaded onto coherent factors and explained 68.7% of the variance. The results revealed a strong positive and significant relationship between financial management practices and business sustainability (r = 0.68, p < 0.01), with the practices jointly explaining 66.0% of the variance in business sustainability (R² = 0.660). Working capital management (β = 0.33) and financial planning (β = 0.30) emerged as the strongest path predictors. The study concludes that sound financial management significantly enhances business sustainability and recommends strengthening working capital management, financial planning, and record keeping.

Keywords

financial management business sustainability working capital financial planning manufacturing
Metropolitan Journal of Academic and Applied Research

Cite This Article

Namayanja Diana & Zikusooka Enock (2026). Influence of Financial Management Practices on Business Sustainability of Manufacturing Firms in Kawempe Division, Kampala, Uganda. Metropolitan Journal of Academic and Applied Research, 5(8). https://journals.miu.ac.ug/pages/article.php?article_id=741

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