Three Key Questions for Small-Business Owners in 2025

A small business owner flips the open sign on the door of her business.

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There are countless financial factors to keep in mind as a business owner. As 2025 kicks into full gear, there are a handful of proactive questions to ask yourself and your adviser that will set up your business, and its finances, for another successful year ahead.

1. How will my business grow this year?

There’s no right way to expand your business. If you don’t know where to go next, goal-setting doesn’t always have to be about the big picture. Instead, putting intention behind your processes is a great place to kick off. A few ways to do so:

Focus on tracking your expenses and building income. Every dollar counts, especially for small and midsize businesses (SMBs). Find a system that both fits your business model and serves as an easy way to facilitate cash flow management and analysis.
Ensure that bills are paid on time. This is equally important for outflows and revenue collection. Having a solid grasp on accounts receivable and accounts payable will set up your business for success. People are always at the heart of every business; staying on top of bills will improve relationships with vendors, employees and clients.
Keep cash on hand for emergencies. As with personal expenses, having a backup of three to six months’ worth of cash reserves gives a cushion for slow seasons, investments and operating costs. If that isn’t doable, seeking financing can be a great backup option.

2. My business needs financing, but what are my options?

Growing businesses have specialized financing needs. Determining best option for your business will depend on the size, age and cash flow of your business. What your business needs comes down to timing, purchasing needs/accounts payable and hopes for investment into the business.

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If financing is a natural next step for your business’ growth and operations, the options only get more complicated. Consider the following factors to narrow it down:

Is revenue consistent? A single investment that would generate more revenue or provide long-term cost savings (think: equipment, machines, space) would align well with a vehicle such as a term loan, which can be set up to have regular, fixed payments.
What is your credit score? Interest rates across credit options can vary depending on your personal credit history.
Does my cash flow call for consistent financing support? A line of credit (such as a loan or credit card), for example, will grant access to funds as needed. Depending on the type of payments you’re making (payroll vs business travel expenses), your preferred option will vary.
How much time do I have? Some lines of credit take longer to access. For example, an SBA loan requires a hefty, time-consuming application process.

3. Do I need to invest in my stakeholders?

There are numerous people, clients and partners who care about your business and are dedicated in different ways to its success. Everyone within and immediately surrounding your business is part of your network, creating opportunities and offering solutions to challenges in the market. A few people to focus on building relationships with this year can include:

Vendors. Without strong vendor relationships, many business functions can be delayed, mispriced or fall below ideal quality standards. Leave no stone unturned; every business that supports yours matters and should be enabling your success. Consider each company you work with, from accountants to landlords, freelance designers to raw material suppliers. Find ways that you can serve one another, ensure a stable relationship and truly understand one another’s business to enhance collaboration to make both of your businesses more efficient.
Partners. Are you and another organization offering complimentary goods or services to a set of customers? If so, keep a close watch on partnerships. Ensure that the partners you work with are best-in-class. If shopping around isn’t an option or preferred, this is a key moment to take the time and express your needs to those existing partners. Collaboration is the key to success, especially when there’s a shared knowledge of the end customer.
Financial services providers. With the right tools, a small business can accelerate growth across revenue, customer satisfaction, product/service quality and in many other ways. However, it can be overwhelming to manage finances in a new way, on top of running a company in an ever-changing environment. Having an existing, positive relationship with your banker and/or financial adviser takes away one barrier to entry. Even if you don’t know how to get to the next phase, you know where to begin. Even if it’s not on your to-do-list for 2025, whether your next big step is improving point-of-sale, taking out a line of credit or seeking information about M&A, find someone you trust for big financial questions. When opportunity strikes, you’ll be ready.

Setting financial goals for your business is more than a beginning-of-a-new-year exercise. It serves as a blueprint for your company’s growth and success in a sustainable way. Diligently managing your cash flow, exploring funding options/determining if you need them and investing in fostering strong relationships with stakeholders creates a solid foundation for your business to grow on.

Disclaimer

This article was written by and presents the views of our contributing adviser, not the Kiplinger editorial staff. You can check adviser records with the SEC or with FINRA.

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Mark Valentino is President and Head of Business Banking at Citizens. Under his leadership, the Business Banking team brings comprehensive advice and solutions to help small businesses operate at every stage of their journey. Mark rejoined Citizens in October 2023 after leading a privately owned healthcare provider in Southern California. During that time, including his role as CEO of LA Downtown Medical Center, he dedicated his energy and efforts to expanding mental health access to the underserved communities of greater Los Angeles.