How did the trends, opportunities and challenges over the last year shape your business in 2024? Inflation, high interest rates, supply chain disruptions, advances in Artificial Intelligence (AI), and cybersecurity all played a role in how your business fared. 86% of business leaders said economic uncertainty was one of the top challenges they faced in 2024. Some of these same challenges will continue into 2025 as hustlers work to grow their sales and keep pace with the always changing business landscape.
Being a business owner is tough. You have to make decisions quickly and oftentimes those decisions are made without knowing all the facts. Understanding the always-changing trends that affect your business is a great start to help your company gain a competitive edge.
The future of your business depends on you looking ahead and evolving with the changing times. These five business dynamics will continue to cause you headaches, but also offer new ways of doing business to help take you to the next level.
- Financial Resilience: A recent Quick Books survey showed 61% of business owners say inflation has been their biggest challenge over the last few years. While there is optimism inflation will continue to fall, it’s imperative you explore creative ways to diversify. Reducing debt you may have and saving for unexpected challenges should always be on your agenda. Finding new revenue streams, expanding product lines, and pursuing partnerships with like-minded companies can help increase revenue. Experiment with growth strategies to see what works and always be looking for ways to strengthen your bottom line.
- Using AI to Handle Everyday Tasks: While I understand the basics of AI, I’m a complete novice when it comes to understanding the many ways it can help businesses. Yes, it’s controversial, but that shouldn’t stop it from becoming a major factor in your company’s growth. From using ChatGPT to help draft social media posts, marketing or advertising copy and blog articles, to having chatbots on your website providing 24/7 answers to FAQ’s and other simple customer questions allows your human reps to focus on more complex tasks. To get started, identify a specific problem AI can solve, like managing customer inquiries, and then look at the AI solutions available. There are many free AI tools and as you get more comfortable using it, you can research various AI products and their costs. To be clear, AI will revolutionize business the way the internet did, so don’t be left behind by dismissing this powerful technology as just another fad.
- Cybersecurity: Sadly, there will always be people looking to steal your money and assets. As a small business, it’s imperative you use the tools available to protect your company from these criminals. Training your employees to be vigilant is the first step since they are a direct pathway into your systems. Train them on spotting phishing emails, avoiding suspicious downloads, using best practices on the internet, and protecting sensitive customer information. Enable multi-factor authentication as it requires more than a username and password for verification. Install anti-virus software on all business computers and keep it up to date. Remote employees should use a virtual private network (VPN) to connect to your network securely and all software should be configured to install updates automatically. Understanding your business’s unique risks to cyberattack is crucial, and groups like the Small Business Administration offer training to help keep you safe.
- Keep Tabs on Your Supply Chain: The pandemic caused massive supply chain disruptions for businesses of all sizes. While things have somewhat returned to normal, new threats continue to plague the goods we receive from all over the world. If your products come from overseas, the expected Trump tariffs could force price increases while labor strikes could create huge backups at ports. Geopolitical tensions also remain high and could increase trade disruptions, especially in the Middle East and Asia. How do we navigate these challenges to ensure we have product to sell? Make sure you keep track of your stock and replenish when needed. If at all possible, keep more inventory on hand, especially those popular products you sell a lot of on a regular basis. Always be looking for new suppliers in different locations in case something happens to your current supplier. Be prepared, stay informed, and always be looking for alternative sources of products you need to keep your customers happy.
- Remote and Hybrid Work Models: The Pandemic changed how employees work, and millions continue to do so remotely. While some businesses, like Amazon, want to end the work-from-home model, millions of other small companies have embraced it. This trend will continue as employers have found it can hugely reduce the costs of running a business. The elimination of rent for workspace, break room supplies, janitorial fees, and office supplies are a huge benefit most companies never even thought about pre-pandemic. Many job seekers now look for companies that promote work-from-home as it saves employees transportation costs and time commuting, and may also give them tax breaks using a room in their home for an office. While it’s not a fit for every company or every employee, this trend will continue into 2025 and beyond.
It’s clear small businesses face a myriad of both opportunities and challenges in the coming year. Be vigilant, be ready to pivot, have contingency plans in place, and control what you can.
Given the opportunities above, the choice is clear. Up your game and get on board with the ever-changing world we live in or get left behind. As Lori Greener, from Shark Tank notes, “Running a company is like riding a bicycle. If you stop pedaling, you’re going to fall off.” Keep pedaling into the New Year and see where your business can go.