Despite challenges in 2025, Philly-area small businesses remain resilient and optimistic
Tariffs, inflation, and labor shortages have been challenging to some businesses, but many are still optimistic looking ahead to 2026.
From inflation to tariffs to labor shortages, small businesses in Philadelphia have faced many challenges in 2025. But they remain resilient and, for the most part, are optimistic about the coming year.
But that, of course, depends on the type of business.
For example, the Monkey’s Uncle, a retro Philly sports apparel boutique located in Doylestown, had an “exceptionally strong” year, which was mostly driven by the Eagles’ Super Bowl win. Co-owner Derrick Morgan expects the holiday season to be busy but observes more people are shopping for holiday gifts much earlier this year as consumers are “spreading out their spending much more.”
For small businesses in the Philadelphia region, consumer sales were up 2.4% in October compared to a year before, according to a monthly index from payment technology provider Fiserv. That’s compared to a 1.5% increase nationally. Small-business optimism remains above its 52-year average and uncertainty dropped this month, according to the National Federation of Independent Businesses.
All in all, it hasn’t been such a bad year for most, despite the uncertainty.
Looking to 2026, Morgan is optimistic due to Philadelphia hosting a number of major sporting events (like the MLB All-Star Game), and he is already coordinating commemorative merchandise with licensed vendors. But it’s not economic uncertainty that impacts his business as much as Jalen Hurts or Bryce Harper.
“The nature of our business is very much at the mercy of the wins and losses from our Philly sports teams, which can certainly be unpredictable,” he said.
Regardless of the economic uncertainty, physical fitness remains popular. Valerie Plummer’s Germantown-based Pilates studio — Pilates by Valerie — has had a “profitable and expansive year” thanks to “rising client retention, steady new enrollments, and an increasingly strong sense of community.”
Plummer has used this year to double down on her business by broadening her programming with a series of new classes and apparatus trainings while developing instructor materials, improving internal systems, and strengthening her long-term training pipeline. As for next year? Plummer’s optimistic.
“I am confident in the direction of the studio, the relationships we are building, and the value we are providing — and I’m excited for what’s ahead,” she said.
The restaurant industry has been hit hard recently, thanks mainly to increasing costs and labor shortages. In Media, Rainy Culbertson’s breakfast restaurant, The Corner, has had a difficult year.
“Customers are uncertain about their finances,” she said. “Eating out is a luxury and is one of the first cuts to a person’s budget in economically uncertain times. We’ve had ups and downs this year, but mostly down.”
Like many restaurants, The Corner faces challenges in labor retention, cost increases, and competitive issues. And they’re still recovering from the pandemic, Culbertson said.
“Most restaurants have not recovered from COVID, it’s just that we stopped talking about it because folks want it behind them, ourselves included,” she said. “Most restaurants still carry debt from COVID and now they have to deal with economic uncertainty and painfully thin profit margins due to inflation.”
It’s not surprising that Culbertson remains very uncertain about 2026.
“I’m optimistic it will be better but realistically, it will probably be more chaos and stress dealing with inflation and tariffs,” she said. “A lot depends on how long this madness of inflation, tariffs, and the unstable economy drags on. I’m really close to calling it quits.”
Heather Herbert, the co-owner of Tail Spinz in Montgomeryville says her family-owned dog daycare has grown every year since its opening in 2023. It saw growth this year too, but some months were slower.
“2025 has had its ups and downs, with some months of steady growth and others that have leveled off a bit,” she said. “Our business is built almost entirely on word-of-mouth and referrals, which creates a slower but more sustainable kind of growth. We have had a few families scale back or pause daycare due to budget changes, and we completely understand that we’re a ‘nice-to-have’ rather than a necessity for everyone.”
Herbert is looking forward to even more growth next year and is currently gearing up for the holidays, with “a full lineup of festive events planned” including “a visit from Santa” with holiday photo ops and treats.
“When you provide great care, build genuine relationships, and create a space that dogs are excited to come to, it’s hard not to feel positive about what’s ahead,” she said.
Even in an uncertain economy, specialized businesses like Blevins Sommelier Services can flourish. Focused on bringing “affordable luxury experiences” directly into their clients’ homes, the company, which offers wine tasting and bourbon education events, has experienced strong growth this year with monthly bookings doubling over the prior year.
“I’m optimistic for 2026,” said Amanda Blevins, who operates her business out of her home in Glen Mills. “The demand for wine events remains steady, and the demand for bourbon tastings has increased.”
Tariffs and supply shortages have impacted Blevins’ business, particularly on wines from Italy and France, but like many business owners she’s pivoted and now features more local wines.
“In many cases, hosting private in-home celebrations is more affordable than entertaining at a restaurant or larger rented venue,” she said. “There is always something new to discover in the world of wine and whiskey, and I consider it a wonderful life-long journey.”