Small Business Owners Enter 2025 with Optimism Despite Cost Challenges
Small business owners enter 2025 with a mix of optimism and concern, as indicated by recent surveys. Confidence in business outlook has risen to 79%, up from 73% in mid-2024. However, they face challenges such as rising material costs and inflation.
Material costs have emerged as a significant worry for solo business owners, with 56% listing it as a top issue, a substantial increase from 43% in mid-2024. This has led to two-thirds of small business owners raising prices on their products or services. Inflation is also a major concern, with 64% of owners identifying it as a top issue.
Payroll remains the largest expense for small businesses, followed by materials, supplies, and rent. Expectations for profitability and revenue growth have risen, reflecting the owners' confidence. However, concerns over tariffs have more than doubled, increasing from 5% to 13%.
Small business owners are adjusting their strategies to mitigate challenges. 41% have altered their 2025 spending plans, and 55% cite taxes and fees as a top concern. Despite these hurdles, 79% express confidence in their business outlook, demonstrating their resilience and adaptability.
