America’s small business owners are wrapping up the year with a strong surge of optimism. According to the new TD Small Business Year-End Outlook & Preparedness Survey—conducted by Wakefield Research for Mount Laurel-based TD Bank U.S.—an overwhelming 85% of small business owners expect stronger revenue through the end of 2026, while 78% report feeling more optimistic about the U.S. economy than they were six months ago.
Despite navigating persistent hurdles like inflation, staffing costs, and broader economic uncertainty that prompted 73% of owners to delay business investments earlier this year, Main Street is looking resolutely toward expansion in 2027.
Balancing optimism with preparedness gaps
While confidence is high, the survey reveals clear preparedness gaps as companies look toward the future. A striking 97% of respondents reported feeling unprepared in at least one key operational area for the remainder of 2026.
Specific areas of vulnerability include:
- Technology and Operations: 43%
- AI Adoption: 40%
- Inventory Management: 37%
- Capital and Cash Flow Planning: 37%
To bridge these gaps and fuel expansion, 62% of small business owners expect to seek financing before the year ends, balancing financial prudence with targeted investments. Among those seeking capital, primary intended uses include acquiring new equipment or technology (23%), adopting artificial intelligence (20%), purchasing inventory and supplies (15%), and managing hiring and payroll (14%).
Looking ahead to 2027, growing revenue and sales (26%) ranks as the top priority for business owners, closely followed by investing in technology and AI (22%).
AI moves from experiment to growth strategy
Artificial intelligence is rapidly shifting from a novelty to a cornerstone growth strategy for small businesses. Nearly all respondents (99%) report using AI in some capacity, with 77% noting an increase in usage compared to six months ago.
Business owners are utilizing AI primarily to save time (57%), improve cash-flow decisions (55%), and increase sales (52%). Notably, rather than driving
workforce reductions, 73% of AI-using respondents report that technology adoption has actually increased their headcount, including 17% who noted a significant increase.
Managing cost pressures and fraud risks
Even with a bullish outlook on revenue and economic conditions, business owners continue to operate in a complex environment. Leading financial risks cited include:
- Inflation: 55%
- Staffing Costs: 54%
- Lower Consumer Spending: 53%
- Inventory Costs: 53%
Furthermore, security concerns are mounting: 59% of respondents are more concerned about fraud than they were six months ago, with cyber-enabled fraud (39%) and payment or card fraud (38%) representing their top worries.
“Small business owners continue to demonstrate remarkable resilience and determination,” Chris Ward, head of Small Business Banking at TD Bank U.S. said. “While many are still navigating challenges ranging from rising costs to ongoing uncertainty, our survey shows they’re increasingly focused on growth and planning for future investment. Whether it’s adopting AI, expanding operations or preparing for the opportunities ahead, business owners are looking for trusted partners who can help them turn confidence into action.”
