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Minnesota maintains a reputation for innovation and business growth, supported by its educated workforce, diverse economy, and strong support systems for entrepreneurs. In 2024, the state demonstrated its continued entrepreneurial vigor with over 63,000 new business filings, according to the Secretary of State’s office.

However, small business optimism started 2025 on a cautious note, according to the NFIB Small Business Economic Trends report, with the index dropping 1.4 points to 89.9 in January — the 25th consecutive month below the 50-year average of 98. Small business owners’ primary concerns revolve around inflation (21%), labor quality (23%), and taxes (13%).

The first quarter provides an ideal opportunity for entrepreneurs and small business owners to evaluate their strategies and plan for success. As the economic landscape shifts, business owners must strike a balance between adapting to change and maintaining strategic direction. Here are key considerations for leaders navigating the path ahead.

Start with a clear-eyed assessment 

Begin with a thorough SWOT analysis (Strengths, Weaknesses, Opportunities, Threats). This foundational exercise helps identify what’s working, what isn’t, and where opportunities lie. For instance, if customer retention needs attention, consider redirecting resources toward marketing and consumer engagement. With 57% of business owners adjusting prices due to inflation, according to Bank of America’s 2024 Women & Minority Business Owner Spotlight, staying competitive requires regular strategic review.

Chart your growth path 

The appetite for expansion is strong, with our report showing that 63% of business owners are planning growth initiatives this year. Whether through digital presence enhancement or physical expansion, focus is crucial. Choose strategies that align with your core strengths rather than spreading resources too thin.

Invest in your team 

A business’s success hinges on its people. Forward-thinking owners are increasingly investing in employee development through on-site training and educational resources. This investment not only boosts retention but also creates a more capable, engaged workforce.

Embrace digital innovation 

Technology isn’t just about efficiency — it’s about survival in today’s marketplace. The 2024 Business Owner Spotlight reveals that 71% of small businesses have undergone digital optimization in the past year. From AI-powered recruitment to customer relationship management systems, the right tech tools can transform operations and sharpen your competitive edge.

Secure smart funding 

Growth requires capital, and the U.S. economy has seen commercial and industrial lending grow 3.2% from 2023 to 2024, with a steady 2.1% increase continuing into early 2025. However, many entrepreneurs face challenges when it comes to securing the necessary funds. While traditional bank loans remain popular, explore all options, including grants and alternative funding sources.

Bank of America, which leads the nation in small business lending, offers an Access to Capital Directory, which has a comprehensive overview of available resources.

Small businesses are more than economic engines — they’re the backbone of our communities. Through these strategies, business owners can position themselves for success in the months ahead.

Lucas Giambelluca is president of Bank of America Minnesota and a business banking market executive.