Will Your Business Be Ready for the Economic Shifts of 2025?

Massive economic shifts since the COVID-19 pandemic have changed the way business owners operate. Agile companies are able to pivot when needed and can survive the hard times and thrive when things are on the uptick.

Recent surveys show most business owners have a positive outlook about the economy in 2025. Around 73% of them believe they’ll do well financially. Around 23% state they are “very optimistic.”

Although optimism can drive buying, anything can impact the economy for good or bad. An unexpected attack, changing markets overseas, or another virus could throw things into a tizzy. Making sure your brand is ready for any economic shifts that could occur in 2025 will help you get ahead of the competition and maintain a profitable position despite any sudden changes.

Bracing for Post-Holiday Lag

For most businesses, January and February are traditionally slow months. People are shopped out from the holidays and consumers may be paying off debt they put on credit cards to afford gift giving and travel. B2B companies may find clients are still allocating funds to various areas for the new year.

January is a good time for your business to reset. Focus on marketing and how you’ll bring in new clients in 2025. Look forward to the next nearest holiday. The average consumer spends $196.31 or more for Valentine’s Day. By studying trends from 2025, you can overcome any missteps you made and improve revenue.

Overcoming Slow Global Growth

Even though the world is recovering from the pandemic, the global growth rate is 3%, which is still a bit slow. Economists are still waiting to see if things rebound or will dip into a valley once again.

When current customers avoid spending money, you need to look for new buyers. Diversify the markets by offering different products or matching current clients to similar ones in a different category. For example, a company that sells vacation experiences to millennials might also offer senior trips for those who want to see parts of the world they would never experience.

The question business owners should ask is who else might be interested in what they do and can they adapt their product to solve the pain points of that buyer persona?

Hiring Top-Rated Employees

Even though unemployment sits around 4%, many companies are waiting to hire people. They’re worried about tariffs and regulations a new administration might impose and are in a wait and see mode. Most companies will get to know what a new president and congress’s policies are and resume spending as they see the patterns.

The best thing you can do during this time is hire the best of the best. The number of jobs might be limited in the early part of the year. At the same time, make sure you can offer long-term employment should the economy tank. You don’t want employees worried about whether they’ll have a job. Their focus should be on growing your business and innovating.

Becoming Financially Flexible

Many economists worry that troubling conflicts around the world, such as in the Middle East and Ukraine, could negatively impact the world economy. Imagine a situation where the stock market closes after a devastating drop and people are panicking. If people lose their jobs, they won’t buy from e-commerce brands. Their focus will be on surviving. In turn, if you serve other businesses, they’ll cut back on their spending.

Keep in mind things you can do to contribute to a circular economy that keeps things moving.

• Recycle materials, such as concrete, coal ash and plastics. Not only is it good for the environment, but sustainability creates jobs and those people buy products.
• Save an emergency fund for those times when no money is coming in, a big client declared bankruptcy without paying you, or something needs repaired.
• Have a plan to bring in money quickly if needed through clearance sales and events.

At least one department should keep tabs on how much money flows in versus how much goes out and sound the alarm if the two numbers misalign.

Overcoming High Loan Payments

Most businesses owe money to one or more banks. Whether you’re still paying off startup costs, took out money for an expansion or had to use credit cards to survive a rough patch, loan payments can eat up your profits.

Interest rates are likely to change again with a new administration coming into the White House. Whether they go up or down, changes can impact your loan payments and interest rates. You can’t control what the Federal Reserve does but you can prepare for the worst case scenario and consider a few changes.

• Consolidate loans to lower payments.
• Refinance to take advantage of lower interest rates.
• Pay debt down as quickly as possible so you aren’t impacted by fluctuations in interest rates.

When payments go up for consumers, they might cut back on their extra spending. Real estate professionals and restaurants are likely to see the most impact from higher interest rates. However, when consumers spend cautiously, the results can trickle down to any business.

What Is Ahead For Business Owners?

No one can perfectly predict all the economic changes to come. However, business owners can be sure that the markets will fluctuate and it will impact their companies. Rapid advancements in artificial intelligence can change how well competitors perform and how productive employees are. The best approach is to be prepared for anything and take action quickly to ensure you overcome the challenges and keep moving forward.