Jul 3, 2025

The pressures are significant, from tightening budgets and longer sales cycles to shifting workforce priorities and turbulent markets. Within this environment, we are seeing artificial intelligence (AI) stand out as an underestimated ally. As my team has pivoted, we've embraced what AI offers in practical solutions that help us sustain some areas and grow in others. I'd like to examine the critical challenges faced by small businesses and outline specific, actionable ways you can use AI to provide tangible improvements. Boosting Bottom Lines Amidst Economic And Financial Pressures One of the most pressing issues for small businesses is managing costs and maintaining healthy financials. AI offers several avenues for relief that directly impact profitability. One of the most popular and effective is how intelligent automation can streamline repetitive administrative tasks. Think about invoice processing, payroll, and basic customer inquiries. Furthermore, sophisticated AI algorithms can optimize pricing strategies in real time based on market demand, competitor analysis, and even individual customer behavior. Always look for ways to reduce manual tasks and free up your team's time to focus on revenue-generating work. For example, AI-powered budgeting and forecasting tools, which leverage historical data and predictive analytics, can help provide more accurate cash flow predictions. Quickbooks, Docy and Budgyt are notable platforms that have integrated AI to accelerate the budgeting process and allow for better scenario planning. Securing And Optimizing Workforce And Talent Finding and retaining skilled employees remains a significant pain point for many small businesses, which are often constrained by limited recruitment resources and competitive salaries. AI can help bridge this gap in several ways. First, AI-powered recruitment platforms analyze many candidates, identifying the best prospects for open positions. Once onboard, AI-driven learning management systems like Coursebox and Absorb LMS can personalize training programs based on individual employee needs and performance. Clarifying And Navigating Regulatory And Policy Uncertainty Changes in regulations and policies, from data privacy to labor laws, can be burdensome and resource-intensive for small businesses with limited access to dedicated legal teams. AI can offer a crucial support layer in staying compliant and mitigating risk. There are AI tools that can help analyze complex legal documents, identify relevant regulations specific to your business and flag potential areas of non-compliance. These AI-powered tools can also assist with data privacy compliance, automate the generation of reports and track regulatory updates. While AI cannot replace expert legal counsel, it can provide an invaluable tool for understanding and adhering to the rules. Our approach to ensuring compliance involves generating custom prompts or using AI agents that draw from industry and government compliance documents, allowing our legal language to directly address the specific requirements at hand. Think about companies that need to be SOCII-compliant. This can take months even up to a year to adhere to. But with AI and AI agents, you can have this often laborious and long task expedited to accelerate your compliance. Addressing Digital And Technological Challenges For many small businesses, keeping up with the rapid pace of digital transformation, from e-commerce to data security, can feel overwhelming and financially prohibitive. But AI is democratizing access to powerful technologies. User-friendly, often cloud-based AI platforms make advanced capabilities, such as sophisticated data analytics, machine learning-driven marketing automation and predictive insights, accessible even to those with limited technical experience or expertise. Some of your favorite tools like salesforce HubSpot Microsoft dynamics and others have integrated AI to take customers from being leads to being loyal. AI-powered cybersecurity tools are more affordable and scalable than traditional solutions and can provide enhanced protection against evolving digital threats, safeguarding valuable data, customer trust, and business continuity. Building Resilient Operations Amidst Market And Supply Chain Issues The volatility of global markets and the increasing complexities of modern supply chains pose significant challenges to the stability and profitability of small businesses. Advanced AI-powered demand forecasting can help you analyze many factors, from historical sales data to social media trends and financial indicators, to help anticipate shifts in customer demand with greater accuracy. AI algorithms can also analyze real-time data on supplier performance, logistics and potential risks. Platforms in the market like Freight Verify, project44 and FourKites can help do this seamlessly. Holding AI Accountable: Measuring Real-World Improvements To understand the value of AI, small businesses need to track its impact on defined key performance indicators (KPIs). Make sure to track cost efficiencies, employee productivity and retention rate improvements and reduction in regulatory compliance costs. Three Strategic Actions For Small Business Leaders 1. Engage a knowledgeable AI partner for opportunity assessments. Instead of navigating the complex AI landscape alone, seek a trusted partner with expertise in AI and small business operations. This collaboration will thoroughly assess your current business environment, analyze workflows, identify bottlenecks and pinpoint specific areas where AI can offer the most significant impact and return on investment. 2. Embrace low-risk AI experiments for learning. Move beyond theoretical understanding by initiating small-scale, low-risk AI experiments. This approach could involve training an AI-powered customer service chatbot for a specific channel, implementing an AI tool for basic marketing automation, or using AI for preliminary data analysis on a limited dataset. 3. Invest in team trust and adoption through workshops and group coaching. The successful integration of AI requires more than just technology; it demands the buy-in and trust of your team. Implement workshops and group coaching sessions focused on demystifying AI, showcasing its benefits for individual roles, and addressing any concerns or anxieties about job displacement. Building a culture of understanding and enthusiasm around AI is essential for long-term adoption and maximizing its potential within your small business. In conclusion, AI offers efficiency to small businesses that are looking to focus on their core capabilities. Business owners can take the approach of doing more with less or doing more with what they have. Either way, AI is driving impact on profitability, company culture and product innovation. Waiting is not an option. AI is here to stay. Forbes Business Council is the foremost growth and networking organization for business owners and leaders. Do I qualify?