58% of small businesses are now using artificial intelligence according to the U.S. Chamber of Commerce, more than double the adoption rate from just two years ago.
It took decades for small businesses to fully leverage the internet following the dot-com boom, when larger companies were spending immense capital to shape that new frontier as a competitive advantage.
Artificial intelligence does not exist on that same timeline. The competitive advantages that can be gained from utilizing AI are not shaped by capital but rather an understanding of its use cases.
The divide isn’t just adoption vs. non-adoption. It’s intentional use vs. scattered experimentation. Small businesses that understand where to leverage AI in meaningful ways will separate themselves by turning experimentation into measurable results.
The Misconception Holding Most Owners Back
The number one reason small businesses aren’t using AI has nothing to do with cost or complexity. It’s the belief that it doesn’t apply to them.
According to the U.S. Small Business Administration, 82% of small businesses under five employees believe AI isn’t applicable to their business. That rate, however, dramatically decreases as a business grows, suggesting that the barrier to usage is education and not the business itself.
Research conducted by Service Direct further explores this. In their survey, 62% of small businesses cite a lack of understanding of AI’s benefits as their largest barrier to entry. After all, AI tools are often seen as a mystifying technology that requires teams of employees working to understand how best to use it within a business.
This mindset can cost small businesses dearly. McKinsey’s research found that companies with leading AI capabilities outperform lagging competitors by 2–6x in total shareholder returns, which in a small business context means more revenue to thrive and scale.
Leveraging artificial intelligence within a small business isn’t about replacing people or building complex systems. It’s about reclaiming time and removing the roadblocks in the areas where small businesses may already be losing ground to their larger counterparts.
What the Data Actually
Shows Even though adopting AI may seem like a time-consuming task that takes away from revenue generation, its benefits compound and pay exponential dividends. Here are just a few ways.
Time:
58% of small businesses using AI report saving over 20 hours per month by leveraging it for their key use cases. According to Forbes, 58% of small business owners work at least 50 hours per week. That amount of time savings can be redirected toward strategy, relationships, or simply a walk. All without losing any productivity that was previously generated through those 20 additional hours of work.
Revenue:
Salesforce found that 91% of small businesses using AI report revenue increases, while Service Direct reports that 88% see improved business growth. In fact, growing small businesses are 1.8x more likely to have adopted AI than their struggling counterparts.
Cost:
According to Thryv, 66% of AI users report saving between $500–$2,000 per month through AI usage in their business. For companies operating with a 7–10% profit margin, being able to reallocate that money could have tangible effects on the bottom line each month.
Operations:
The Information Technology and Innovation Foundation found that small and medium-sized businesses are just 47% as productive as larger organizations. AI is the most accessible tool an entrepreneur has to close that gap. Rapidly deployable AI workflows and task assistance can bring those percentages closer without requiring significant capital investment.
Where to Start
Identifying the areas where AI may have the highest return on investment that generates immediate and measurable outcomes is how AI belief and ultimately adoption happen.
Marketing and Content:
Marketing is a common entry point for most small businesses because the outcome is immediate and can be quantified in revenue. Tasks that have consumed hours can be reduced to 30 minutes. For the business owner working 50+ hours a week, those time savings start to compound quickly.
Action: Identify one area of marketing or content creation that consumes the most time within the business. Research that use case and leverage AI to generate material. Document the time savings over a one-month period.
Customer Service and Responses:
The bulk of a business’s customer service inquiries commonly come from the same 10 questions asked repeatedly. Utilizing AI, document those common questions, build thorough answers, and create a response script that can act as a playbook for team members, ultimately improving the level of support customers receive when inquiries arise.
Action: Spend one hour identifying the 10 most common questions received. Use an AI tool to draft thorough, on-brand responses and request that it build a customer service playbook that can be leveraged by staff.
Decision Support and Forecasting:
BCG’s research found that 60% of companies are not generating value from AI because its usage isn’t tied to real operating processes. By tying AI to areas such as revenue forecasting and cost pattern identification, businesses are able to proactively manage risk.
Action: Before the next planning cycle, run historical revenue and expense data through an AI analysis tool. The idea isn’t to have AI make decisions for the business but rather give it a new angle to view its current landscape and what lies ahead.
The Window Is Open. For Now.
The Small Business Administration’s data shows that small businesses are roughly one year behind large companies in AI adoption. As mentioned, that is a dramatically shorter time frame than other technological advances we have seen throughout history. That pace of compression is where small businesses will gain ground.
BCG discovered that 50% of companies are stalling on their AI efforts. This isn’t the result of the tools not working but rather being introduced with no clear direction and no identified use cases. Small businesses that know their use cases and leverage AI consistently will experience the compounding benefits that many others never will.
Small businesses have historically been forced to react to new technology. AI is an unprecedented opportunity for smaller organizations to shape how these systems are leveraged, before the window closes.
References:
U.S. Chamber of Commerce; Empowering Small Business Report 2025: U.S. Chamber of Commerce — Empowering Small Business Report 2025
SBA Office of Advocacy; AI in Business: Small Firms Closing In: SBA Office of Advocacy — AI in Business: Small Firms Closing In
Salesforce; SMB Trends Report 6th Edition: Salesforce — SMB Trends Report 6th Edition
Thryv; AI and Small Business Adoption Survey 2025: Thryv — AI and Small Business Adoption Survey 2025
McKinsey & Company; Digital Skills and AI Productivity Research: McKinsey & Company — We’re All Techies Now
BCG; AI Adoption Puzzle: Why Usage Is Up But Impact Is Not: BCG — AI Adoption Puzzle
ITIF; AI Can Improve US Small Business Productivity: ITIF — AI Can Improve US Small Business Productivity
Service Direct; 2025 Small Business AI Report: Service Direct — 2025 Small Business AI Report
Forbes / Mike Kappel; Who Are Small Business Owners in America: Forbes — Who Are Small Business Owners in America
AI tools should be used responsibly. Always review outputs before acting on them and avoid sharing sensitive business or customer data with third-party tools.