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In 2015, our company faced a brutal decision. We built our business around providing low-cost consumer technologies, but political changes introduced regulations that threatened our core revenue streams.
We made the difficult decision to alter and move from the consumer market to the corporate market. It was dangerous, and many of my smartest friends and peers advised us against it, but ultimately, and fortunately, the move paid off. This taught us an necessary lesson: The firms that thrive are the ones that see major changes coming and adapt before they hit.
With the Trump administration coming to power in 2025, we will expect changes that may affect every sector. New tariffs, taxes or compliance orders can reshape markets overnight. Meanwhile, advances in generative AI and evolving global supply chains are already forcing firms to rethink their operations.
Leaders who recalibrate now will have a strong advantage and be able to seize latest opportunities. Here are some key lessons we have learned as we adapt to changing markets:
1. Political changes require diversified revenue streams and strategic planning
At that point, we had transitioned from consumer to enterprise technology and focused solely on hardware, with no recurring revenue or services. To remain resilient, we wanted diversified revenue sources – a strategy that is especially necessary during geopolitical shifts.
With the Trump administration taking office next 12 months expect changes in economic policy to affect firms of all sizes. Trade restrictions, latest taxes or even stronger pressure on TAA (Trade Agreements Act) compliance can change the way firms approach operations, procurement and growth plans.
If, for example, the latest administration revisits tariffs on foreign imports, “Made in America” will likely be greater than just a slogan; it may very well be a requirement for all government contracts, displacing firms dependent on low cost foreign production.
It could even shift to a Designed in America approach, driving domestic innovation, supporting latest technologies and establishing a more resilient downstream supply chain – something desperately needed across the U.S., as highlighted in a recent report Discussions about the CHIPS Act.
Prepare by diversifying your sourcing and production locations. A “dual supply chain” model that sources each domestic suppliers and U.S.-friendly countries can minimize risk while opening the door to latest opportunities.
If you source from one region, you are risking your small business. Think of TAA compliance as a technique to future-proof your small business: as the government increases incentives and penalties, you will need to remain on the right side of those rules.
2. Artificial intelligence improves business results: use it or be left behind
Artificial intelligence enables firms to predict consumer behavior, manage inventory efficiently and deliver higher products. From predictive healthcare to food delivery, AI is improving the customer experience.
Take health care, which firms once shunned investing in hardware innovations are now deploying custom devices to capture and analyze patient data in real time because it gives them an immediate competitive advantage. These devices generate insights that were once unimaginable, reduce costs and open latest revenue streams.
We are also seeing large consulting groups and Fortune 500 firms that have historically been risk averse in hardware looking at by investing in more equipment engineering and design, on account of its potential to generate original data – a hot commodity in today’s market. Look no further than the Apple or Android ecosystems to obviously understand why hardware control is so necessary.
Every company should actively integrate artificial intelligence into its operations or partner with firms that specialize in it. Many AI tools are available at low price, and as AI develops at a rapid pace, those that are left behind will have a hard time catching up with early adopters.
3. Supply Chain Resilience: Just-in-time is dead
The Trump administration’s favorability for Made in America means it can likely be significant tax reliefs and incentives for design and engineering on home turf. However, taxes on foreign products are prone to increase, adding to the strain on an already fragile global supply chain.
For firms that rely solely on imports or exports, building supply chain resilience is crucial. In 2020, disruptions to the global supply chain got here to light disadvantages of just-in-time inventory models.leaving many people struggling to finish their orders. If your supply chain is not resilient in 2025, your small business won’t be either. “Just-in-time” is not only dangerous – it is history.
Today, maintaining reserves of key components – comparable to semiconductors, which may take months to acquire – is essential. Our company has moved to a model with multi-vendor contracts and strategic inventory planning to stop disruptions.
It is also essential to build strong partnerships with suppliers. A real partner will answer your call on their break day because they know your success is tied to theirs. Create these relationships now or risk paying a high price when supply chain shocks come.
As we enter 2025, don’t assume that any a part of your small business is covered. Smart leaders will accept zero trust mentality and take a close look at their weaknesses before the storm hits.
For small and medium-sized enterprises, self-assessment is particularly necessary: are your revenue streams diversified and, if possible, repeatable? Do you have enough flexibility in your supply chain? Are you ready to react to the latest regulations? What would occur to your small business if sales stopped completely and how long would you give you the chance to survive?
Look to the future, make changes now and use 2025 as a launchpad for growth and strategic diversification. Companies that remain agile won’t just survive – they may excel.