Cash flow management practices and the financial performance of micro and small pharmaceutical businesses in Calapan city

Cash flow management practices play a crucial role in ensuring the financial stability and sustainability of micro and small enterprises, particularly in inventory-intensive industries such as pharmaceutical businesses. This study examined the relationship between cash flow management practices and financial performance among micro and small pharmaceutical businesses in Calapan City, with a specific focus on operating activities and financing activities as key components of cash flow management and sales generation as a primary indicator of financial performance. A quantitative descriptive-correlational research approach was utilized, involving thirty (30) respondents chosen through total enumeration. Information was gathered through a validated questionnaire and analyzed using descriptive statistics and the Pearson Product-Moment Correlation. The findings revealed that cash flow management practices, particularly operating, financing, and investing activities, were implemented at a very high level, while financial performance in terms of sales generation was also high. Furthermore, the results showed a significant positive relationship between cash flow management practices and financial performance, indicating that effective management of operating and financing activities contributes to improved sales generation. The research concluded that effective cash flow management strengthens financial performance by promoting smooth business operations and increasing income. These findings highlight the importance of strengthening operating and financing activities to improve sales generation and overall business sustainability among micro and small pharmaceutical businesses.