Key facts
- 58% of small businesses used AI in 2025, up from 23% in 2023.
- Small businesses are paying a median of about $21 per employee for AI services.
- Firms with 0-49 workers spent an average of $607 per worker in 2025, expecting $1,034 in 2026.
- Some business owners are setting aside monthly buffers for potential AI price increases.
- AI adoption is faster among newer businesses and millennial owners.
Small businesses are increasingly turning to artificial intelligence to cut costs and maintain operations, with a significant rise in adoption observed between 2023 and 2025. However, this integration comes with unforeseen challenges, prompting businesses to budget for AI's "bad habits" such as unexpected price hikes and operational errors.
Sparkles Homes, a company that produces bedazzled products, found AI to be crucial for its survival amidst tariff-related supply chain pressures. Founder and CEO Brandon Lind stated that AI automation and reduced marketing costs were essential, allowing the company to remain in business and retain its employees. Similarly, Amy Wood, CEO of Flint Avenue Marketing, utilizes AI assistants like "Rachel" for phone calls and "Sonny" for lead tracking.
Despite the benefits, AI adoption has led to snafus. Sonny generated an obviously AI-written email that drew ridicule from a lead, while Rachel's tendency to console callers unnecessarily required intervention. Wood noted that unchecked AI implementation can amplify existing company chaos.
Economists observe that while small firms are less likely to use AI than larger counterparts, they employ it more intensely. Small businesses are spending more per employee on AI services, with projections indicating further increases. This has led some owners to treat AI costs as regular operating expenses, setting aside monthly buffers to manage potential price surges and avoid losing investment in workflows dependent on AI platforms.
CPA Mark Gallegos points out that AI costs are often inherited through existing software that has integrated new AI functions, leading to a lack of understanding about additional expenses. A notable trend is the faster adoption of AI services by businesses started after the widespread availability of tools like ChatGPT.
Enthusiastic AI adopters are seeking more use cases and automation. However, for small businesses operating on thin margins, AI integration carries risks. Lind learned this when he accidentally spent $1,000 on AI-generated stock images, leading him to implement daily spending limits and employee guides for AI usage. Wood also noted that AI receptionists require topping up tokens during high call volumes, a situation not faced with human staff, yet she remains committed to AI due to its cost-effectiveness compared to hiring multiple employees.