How Much Emergency Cash Should My Business Keep? | FlowHaxa
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How Much Emergency Cash Should My Business Keep?

Rather than a flat "three to six months" rule, size your reserve to your actual worst realistic gap, your slowest season, or the longest stretch a big client has ever paid late. A business with steady retainer clients needs a smaller buffer than one with large, irregular project payments, even at the same revenue level.

Want the full method? See working capital basics for the formula and a worked example, or check your Cash Conversion Cycle to see how long your cash is actually tied up.

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Newslie E.

Newslie E.

Editorial contributor at FlowHaxa, a publication of IGNE Publishing, LLC. Covers small-business finance, automation, and fintech tools.

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