Owners of small and medium-sized businesses are showing cautious optimism for the coming year, with 74% expecting an increase in revenue and nearly 60% planning to expand their businesses. These findings come from Bank of America's 2025 Business Owner Report, conducted in partnership with the Bank of America Institute. The report aligns with data from the Bank of America Institute indicating that small business profitability growth has remained steady throughout 2025.
About half of surveyed business owners believe that local (53%), national (48%), and global (45%) economies will improve over the next year. Many said their confidence would rise if tariff policies stabilized (53%), inflation decreased (52%), interest rates declined (52%), and supply chains strengthened (39%).
“Business owners face the coming year with confidence and a clear focus on growth,” said Sharon Miller, president of commercial banking at Bank of America. “Many plan to retain their current staff and hire more, forecasting improvement in local, national, and global economies.”
The report highlights several key trends:
- Labor market challenges: Around 61% say they have been affected by labor shortages. Of those impacted, half are working more hours due to understaffing, while 40% are increasing wages to attract competitive talent. Only 1% plan layoffs in the next year; instead, 43% intend to hire more employees.
- Adoption of artificial intelligence: AI is becoming essential for business owners; 77% have integrated it into operations over the past five years. They use technology services for marketing (50%), content production (38%), customer service (37%), and inventory management (28%). Payments by small businesses for tech services, including AI, rose nearly 8% year-over-year in October.
- Supply chain issues: Seventy-five percent report being affected by supply chain problems. Among those impacted, 52% are raising prices on goods or services and 38% are struggling to obtain them.
- Managing inflation: Most business owners (88%) say they feel the effects of inflation as they did last year. As a result, they are increasing prices for goods or services (64%) and reassessing cash flow and expenses for the coming year (39%).
Looking ahead five years, business owners remain moderately optimistic about growth and innovation. Their priorities include expanding their customer base (47%), broadening product or service offerings (39%), and exploring new marketing tactics (35%). Nearly all respondents (91%) expect to implement more digital tools and AI over this period to modernize further, drive growth, and improve employee efficiency.
Planned initiatives include accepting more forms of digital payment (52%), improving employee workflows for daily tasks (47%), implementing additional digital marketing strategies (45%), and increasing cybersecurity measures (30%).
Succession planning remains divided among respondents; most do not focus on exit strategies for the next five years—although 60% have a succession plan in place while 40% do not. Among those who do have a plan, about one-third intend to transfer ownership within their family while others aim to sell.
The survey was conducted online by Ipsos between September 11–23, 2025 among U.S.-based small-business owners with annual revenues between $100,000–$4.99 million employing two to ninety-nine people; it also included mid-sized firms with revenues up to $49.99 million employing up to four hundred ninety-nine staff.
Bank of America serves approximately seventy million customers—including around four million small-business owners—with various financial products across three thousand six hundred branches nationwide as well as through digital platforms used by nearly fifty-nine million verified users.