Small business cash flow differs sharply across industries and business models. In the JPMorgan Chase Institute’s February–October 2015 transaction sample, the median small business held 27 cash-buffer days, while recent Federal Reserve survey results show that 51% of small employer firms cited uneven cash flows as a financial challenge.
Contents
- Daily cash inflow and outflow benchmarks
- Cash balances by industry
- How cash-buffer days are distributed
- Industry differences in cash-buffer days
- Business segments and metro areas
- Recent pressure and financing needs
Daily cash inflow and outflow benchmarks
The JPMorgan Chase Institute measures cash inflows as credits and cash outflows as debits in Chase business deposit accounts. For February–October 2015, the median small business had average daily cash outflows of $374 and average daily cash inflows of $381. These are transaction-based medians for the study sample, not a current forecast for every small business.
The gap between inflows and outflows was also different by industry. Personal-services businesses had median average daily cash outflows of $216 and inflows of $219. High-tech-services businesses had median outflows of $374 and inflows of $387. Health-care-services businesses had median outflows of $577 and inflows of $598. Restaurant businesses had the highest listed daily activity, with median outflows of $957 and inflows of $968.
| Business type | Median daily outflows | Median daily inflows |
|---|---|---|
| All small businesses | $374 | $381 |
| Personal services | $216 | $219 |
| High-tech services | $374 | $387 |
| Health-care services | $577 | $598 |
| Restaurants | $957 | $968 |
Source: JPMorgan Chase Institute, Cash Flows, Balances, and Buffer Days, February–October 2015. The study’s cash-flow measures describe credits and debits observed in Chase business deposit accounts.
The figures show why a single cash-flow benchmark can be misleading. A restaurant may move substantially more money each day than a personal-services business, but daily transaction volume alone does not reveal how much liquidity is available when receipts slow or expenses arrive before customer payments.
Cash balances by industry
The median small business held an average daily cash balance of $12,100 in the same JPMorgan Chase Institute sample. Balances varied materially by industry. High-tech manufacturing businesses had a median average daily cash balance of $34,200, while wholesalers had $18,500. Construction businesses had $10,700, and personal-services businesses had $5,300.
| Business type | Median average daily cash balance |
|---|---|
| All small businesses | $12,100 |
| High-tech manufacturing | $34,200 |
| Wholesalers | $18,500 |
| Construction | $10,700 |
| Personal services | $5,300 |
In most industries, businesses at the 75th percentile held cash balances three to four times the industry median. That distribution matters when comparing a company with an industry midpoint: the midpoint does not describe the full range of balances, and businesses near the upper end may have several times as much cash as the typical business in the same industry.
The source reports balances for February–October 2015. They should therefore be read as historical descriptive statistics rather than as a current estimate of the cash balance a business should maintain. They also describe cash in deposit accounts, not total assets, available credit, or profitability.
How cash-buffer days are distributed
The JPMorgan Chase Institute defines cash-buffer days as the cash balance divided by average daily cash outflows. On that measure, the median small business held 27 cash-buffer days in reserve during February–October 2015. Half of small businesses held less than one month of cash-buffer days.
The distribution was uneven:
- The bottom 25% of small businesses held fewer than 13 cash-buffer days.
- The median small business held 27 cash-buffer days.
- The top 25% held more than 62 cash-buffer days.
These points describe the spread between businesses with limited liquidity and those with more than two months of outflows represented by their cash balance. They are not a recommended reserve target. The source’s measure uses observed cash balances and average daily outflows, so it does not account for every possible future expense, credit line, receivable, or owner contribution.
Cash-buffer days can also put daily activity and cash balances into context. For example, a business with high daily inflows may still have a relatively short buffer if outflows are also high and the account balance is modest. Conversely, a business with lower transaction volume may have more days of coverage if its balance is larger relative to its outflows.
Industry differences in cash-buffer days
Cash-buffer days varied substantially among industries in the historical transaction sample. Restaurants had a median of 16 cash-buffer days. Repair-and-maintenance businesses had 18, retail businesses 19, and construction businesses 20. Personal-services businesses had 21, while wholesalers had 23.
Several industries had higher medians. Metal-and-machinery businesses had 28 cash-buffer days. Health-care-services businesses had 30. High-tech manufacturing businesses had 32. Other professional-services businesses and high-tech-services businesses each had 33. Real-estate businesses had the highest listed median, at 47 cash-buffer days.
| Industry | Median cash-buffer days |
|---|---|
| Restaurants | 16 |
| Retail | 19 |
| Construction | 20 |
| Wholesalers | 23 |
| Metal and machinery | 28 |
| Health-care services | 30 |
| High-tech manufacturing | 32 |
| Other professional services | 33 |
| High-tech services | 33 |
| Real estate | 47 |
The range from 16 days for restaurants to 47 days for real estate is a difference in historical medians within this source’s sample. It does not establish that one industry is universally safer or more profitable than another. Cash timing, expenses, customer payment patterns, and the composition of each business can all differ within an industry.
Business segments and metro areas
The source also separates small businesses into capital-intensive and labor-intensive segments. Capital-intensive small businesses held a median of 38 cash-buffer days in February–October 2015. Labor-intensive small businesses held a median of 23 days. The labor-intensive segment therefore held 15 fewer median cash-buffer days than the capital-intensive segment, according to the study.
The JPMorgan Chase Institute also reported metro-area medians. Atlanta small businesses had 23 cash-buffer days. Austin had 27, Chicago 28, Columbus 25, Dallas 25, Denver 25, Detroit 26, Houston 27, Las Vegas 27, Los Angeles 28, Louisville 24, Miami 25, Milwaukee 25, New Orleans 27, and New York 28.
| Metro area | Median buffer days | Metro area | Median buffer days |
|---|---|---|---|
| Atlanta | 23 | Austin | 27 |
| Chicago | 28 | Columbus | 25 |
| Dallas | 25 | Denver | 25 |
| Detroit | 26 | Houston | 27 |
| Las Vegas | 27 | Los Angeles | 28 |
| Louisville | 24 | Miami | 25 |
| Milwaukee | 25 | New Orleans | 27 |
| New York | 28 | — | — |
These metro figures are also descriptive medians from February–October 2015. They should not be treated as current rankings or as a prediction for an individual business in any city. The overall sample’s median of 27 days provides context for the listed metro-area values.
Recent pressure and financing needs
More recent evidence comes from the Federal Reserve’s 2024 Small Business Credit Survey, fielded in September–November 2024. Its percentages cover small employer firms with 1–499 employees, so this population differs from the historical Chase deposit-account sample.
Rising costs were the most frequently reported financial challenge: 75% of small employer firms cited rising costs of goods, services, or wages. Paying operating expenses was cited by 56%, and uneven cash flows by 51%. These survey measures capture reported challenges, not transaction-derived cash balances or buffer calculations.
Financing activity was also common. Fifty-nine percent of small employer firms sought new financing in the 12 months before the 2024 survey. Among financing applicants, 40% sought less than $50,000, and 56% sought funds to meet operating expenses. Only 41% of financing applicants received all the financing they sought, while 24% received none of the financing they sought.
| 2024 Small Business Credit Survey measure | Share |
|---|---|
| Cited rising costs as a financial challenge | 75% |
| Cited paying operating expenses as a financial challenge | 56% |
| Cited uneven cash flows as a financial challenge | 51% |
| Sought new financing in the prior 12 months | 59% |
| Applicants seeking less than $50,000 | 40% |
| Applicants seeking funds for operating expenses | 56% |
| Applicants receiving all financing sought | 41% |
| Applicants receiving none of financing sought | 24% |
Source: Federal Reserve, 2025 Report on Employer Firms: Findings from the 2024 Small Business Credit Survey. Financing percentages use the relevant applicant or nonapplicant populations.
Taken together, the figures show two different dimensions of small business cash flow. Historical transaction data measures balances, inflows, outflows, and buffer days, while the 2024 survey measures reported pressure and financing outcomes among small employer firms. Neither source is financial advice, and the different dates, populations, and methods mean their percentages and cash-buffer measures should not be combined into a single estimate.