Article has no nextliveshere tags assigned

Article has no topics tags assigned

Article has no colleges tags assigned

Description is very short (less than 50 characters)

Article has no audiences tags assigned

Article has no units tags assigned

Contacts are empty

These messages will display in edit mode only.

UC Goering Center news

Small business cash liquidity in 25 metro areas

By Amoury Hill

Cash liquidity is a critical predictor of small business survival and growth. Cash balances held by a business provide a buffer to absorb unexpected shortfalls in revenues or increases in expenses. While access to credit or other resources can provide some protection, most small businesses have limited access to financing. As a result, cash liquidity is often the first line of defense for a small business.

JPMorgan Chase Institute research shows that 50% of small businesses are operating with fewer than 15 cash buffer days — the number of days of typical outflows a business could pay out of its cash balance in the event of a disruption to inflows. Moreover, only 40% of firms have more than three weeks cash buffer.

Small business cash buffers vary substantially across local economies. The 18 cash buffer days held in reserve by the median small business in San Francisco, San Jose and Seattle is over 60% higher than the 11 cash buffer days held in reserve by the median business in Atlanta and Orlando. Differences in industry mix and the costs of doing business across metro areas do not fully explain the variation in cash buffers.
Our data asset leverages a universe of 1.4 million small operating businesses that use Chase Business Banking deposit accounts and allows us to estimate cash buffers by metropolitan area.

Cash Liquidity in 25 Metropolitan Areas
Metro Area
Median Cash Buffer Days Share with < 14 Cash Buffer Days Share with > 21 Cash Buffer Days
San Francisco
San Jose
18 39% 44%
Seattle 18 40% 43%
Portland 18 42% 40%
Austin 16 43% 40%
16 44% 40%
New York
16 44% 39%
Columbus 15 45% 38%
Denver 15 45% 37%
Houston 15 46% 37%
15 46% 37%
Los Angeles 15 45% 38%
San Diego
15 45% 38%
Dallas 14 46% 37%
Detroit 14 47% 37%
Las Vegas 14 48% 36%
New Orleans 14 47% 36%
14 47% 37%
Sacramento 14 48% 35%
Miami 12 52% 32%
Riverside 12 53% 31%
San Antonio 12 51% 32%
Tampa 12 52% 30%
Atlanta 11 54% 28%
Orlando 11 52% 30%

The wide variation in the liquidity of small businesses across metro areas highlights the potential for place-based policies that support the liquidity needs of small businesses. Additionally, policymakers and advocates could support the small business sector by increasing their focus on helping small business owners manage liquidity and improve their financial resilience. Cash flow management is challenging for small businesses even in a regularly functioning economy. In those conditions, a combination of increased access to credit and trusted guidance to help owners better manage their cash flows can be critically important in helping small businesses build and maintain larger cash buffers. In the face of a large and fast-moving economic shock, policies that quickly provide cash liquidity may be most responsive to the limited cash liquidity many small businesses face.

Amoury Hill is Area Manager, Southwest Ohio, at JPMorgan Chase. Reach Amoury at or 513-985-5132.

JPMorgan Chase is a Goering Center corporate partner, and the Goering Center is sharing this content as part of its monthly newsletter, which features corporate partner articles.

Featured image at top: Photo/Pedro Lastra/Unsplash

About the Goering Center for Family & Private Business
Established in 1989, the Goering Center serves more than 400 member companies, making it North America’s largest university-based educational non-profit center for family and private businesses. The Center’s mission is to nurture and educate family and private businesses to drive a vibrant economy. Affiliation with the Carl H. Lindner College of Business at the University of Cincinnati provides access to a vast resource of business programing and expertise. Goering Center members receive real-world insights that enlighten, strengthen and prolong family and private business success. For more information on the Center, participation and membership visit

Related Stories

UC Goering Center news

July 7, 2020

By Anthony C. Kure Many of us fondly look back on the 1980’s. The music, TV, movies and style are distinctly memorable. For savers and retirees, there is nostalgia for the higher interest rates. These higher rates on bonds and cash, sometimes in the double-digits, generated healthy income. Some retirees could fund all their needs with the interest income from a portfolio of all bonds. When supplemented by Social Security and even a pension, much more common then, investors were less dependent upon stocks, and as a result, less concerned about volatility. Today the notion of living off bonds alone is unrealistic for a vast majority of investors. Yields on the 10-year U.S. Treasury note are less than 1%. High-quality corporate bonds yield a little more, but not much. So retirees living off their investment portfolio need a growth engine to keep up with inflation and sustain purchasing power. That growth engine is stocks. Stocks have a long track record of outpacing bonds, but at a cost. 2020 has served as a reminder that stocks can generate gut-wrenching paper losses. Without the proper approach and mindset, these market declines sometimes lead to panicked reactions. Some simply can’t endure and decide to sell all their stocks in hopes of avoiding further pain. This reaction may provide a little better sleep in the short-term, but it also locks in permanent losses, jeopardizing the success of a retirement plan. So what can be done to avoid such a disaster?

Debug Query for this