How is financial management important in a food manufacturing company?

1 Answer | Add Yours

justaguide's profile pic

justaguide | College Teacher | (Level 2) Distinguished Educator

Posted on

Financial management refers to the use of funds available with a company in the most efficient manner so that all the requirements can be met with as small an amount of funds as possible.

In the case of a food manufacturing company, a financial manager's responsibilities are the same as for any other industry and include: preparing financial reports, acquiring capital when needed, overseeing investments to protect capital, sharing profits with investors by way of dividends, overseeing long-term and short-term allocation of funds.

In the short-term, funds may be used to buy raw materials, pay the employees, buy machinery, maintain the machinery, and pay for energy among many others.

A company's objective is to increase profitability. Financial management can play a large role here, for instance, as they find and manage investments and acquire capital at the best interest rates and distribute dividends.

We’ve answered 318,915 questions. We can answer yours, too.

Ask a question