Comparative measurement of working capital efficiency for Borsa Istanbul restaurants and hotels for the COVID-19 period and previous quarters

The working capital of a company is the current assets that should be converted into cash within a year. To meet the goal of value maximization and to survive in a competitive business environment, managing day-to-day operating activities effectively is important. As one of the important outcomes of Covid-19, international tourist numbers decreased dramatically in 2020 and still remain at a low level. Accordingly, countries’ tourism income and tourism companies’ sales revenues have decreased linearly. This paper is aimed at measuring and comparing the working capital efficiency of companies that are operating in tourism and listed in the Borsa İstanbul by the index method on a quarterly basis for 2020 and the previous seven years. Besides this, the robustness of the index method checked with the regression analysis technique. The findings indicate that companies were efficient in the third quarter of 2020 and were managed efficiently in the second, third, and fourth quarters of the pre-Covid-19 years and inefficiently in the first quarter. The seasonality also showed its effect on working capital efficiency. It was also observed that tourism companies’ efficiency fluctuated in a wide range. It is recommended that businesses should adopt a balanced working capital investment policy because of the importance of working capital management effectiveness to the achievement of their goals. The results of the robustness check indicated that the index method is one of the suitable and useful methods to examine the working capital efficiency