Now is the perfect time for entrepreneurs to evaluate the state of their business and adjust their strategies to prepare for success in the year ahead. BofA Global Research economists expect 2025 to be a strong year, with solid economic growth, higher productivity and reductions in interest rates. Detroit has a number of things in its favor as well.
Detroit is riding a wave of positive momentum for jobs thanks to the Lions’ successful season and the NFL draft celebration reintroducing more than 775,000 people to the newly redeveloped downtown. On a state level, Michigan Gov. Gretchen Whitmer recently signed an R&D tax credit to encourage entrepreneurship innovation across the state. Married with the vast amount of technical support available to small businesses, this has the potential to turn Metro Detroit into the best place to do business in the Midwest.
With an ever-evolving landscape, it’s more important than ever for business owners to establish a plan while staying flexible to adapt as needed. Here are a few steps Detroit-area business leaders can take:
Conduct a SWOT Analysis
Regularly reviewing your business’ strengths, weaknesses, opportunities and threats (SWOT) is important no matter what time of year, but especially as you’re realigning on goals during the first few months of the year. Identifying what works well, what needs improvement, and any possible external challenges will allow you to adjust your business plan to ensure you can capitalize on advantages and address pain points. For example, if you notice customer retention is a struggle for your business, consider adjusting your budget to allocate funds to marketing and customer investment strategies. Or, if inflation is a concern for your business in the year ahead, you may need to adjust your pricing accordingly. You wouldn’t be alone, as 57% of business owners say they are raising prices due to impacts of inflation, according to Bank of America’s 2024 Business Owner Spotlight.
Consider Expansion Strategies
After conducting your SWOT analysis and updating your business plan accordingly, you may be looking to expand. Our report found that 63% of business owners are planning to do just that in the year ahead. When looking at how best to grow your business, make sure to consider what expansion strategies make the most sense. Should you grow your online presence or open a new storefront? Narrowing down and investing in the strategies that will best serve your business will help you see the biggest return on investment, rather than stretching yourself – and your budget – too thin.
Attract and Retain Talent
A business cannot run without its employees, so it’s crucial to evaluate your hiring processes and investments for retention. Bank of America’s report found that many business owners are investing in educational resources for employees such as on-site training programs to further their career growth. Forging stronger relationships with employees will not only help increase retention but offer you more support to avoid working longer hours.
Supplement with Technology
The entrepreneurial spirit can often encourage you to manage all tasks and workflows yourself, but utilizing technology that can simplify your day-to-day is only going to help increase efficiency and productivity. In fact, 71% of small business owners said they digitally optimized their business over the past 12 months, according to the 2024 Business Owner Spotlight.
Technology can help with a variety of challenges – AI and automation tools can source and screen potential candidates, project management tools can strengthen team collaboration, and customer relationship management systems can provide useful information about customer behaviors to ensure your strategies are efficient. Small businesses must embrace and invest in the right technology to optimize operations and stay competitive.
Source the Capital You Need
To make any of this happen, you need the proper capital. In Detroit, Bank of America business lending is up year-over-year, reflecting confidence and growth amongst market small businesses.
Despite the need, many entrepreneurs do face challenges accessing capital. Consider all options to determine the choice best for your business. Traditional bank loans are useful and are likely the default option, but there are many other resources such as business grants that do not need to be paid back and may make more sense for your needs.
If you’re looking for somewhere to start, ask your banker or visit Bank of America’s Access to Capital Directory, which offers a variety of free and low-cost capital resources to consider. As the nation’s top small business lender, Bank of America knows small businesses create jobs and anchor our communities. These steps will help put your business on the path to a strong and successful 2025.
John McManus is a business banking market executive with Bank of America.
