Findings reveal how small businesses are using technology and AI to drive efficiency in 2026.

Clutch research shows small businesses are entering 2026 focused on technology as a driver of competitiveness, efficiency, and customer satisfaction. More than half (55%) plan to increase tech spending, while only 5% expect cuts, reflecting how closely technology investments are tied to business outcomes.

“Technology has become embedded in every core small business function,” said Hannah Hicklen, Clutch analyst who manages tech content. “Our research shows businesses are making more deliberate tech and AI investments to keep pace with evolving customer demands and scale more efficiently.”

Tech Investment Accelerates, Becomes Core to Growth

Customer expectations are the leading factor influencing tech investments (55%), followed by potential ROI and cost savings (42%) and competitive pressure (37%). Improving operational efficiency is the top objective (31%), while cost reduction (13%) and revenue growth (9%) rank lower. These findings show small businesses are making technology choices to stay competitive and meet evolving customer demands.

Web, Software, and AI Lead Priorities as Efficiency Takes Center Stage

Top investment priorities for 2026 include web development (39%), mobile app development (38%), software development (37%), AI (32%), and IT infrastructure (31%). Adoption of AI and automation is growing, with 36% planning to increase spending to streamline workflows, reduce manual tasks, and enhance overall productivity.

Execution Challenges Persist, Driving Demand for External Expertise

Execution remains a challenge, with limited internal technical expertise (26%), rising technology costs (15%), and economic uncertainty (15%) cited as top barriers. Execution strategies vary: 45% rely solely on internal teams, 21% use a hybrid in-house/outsourced approach, and 13% depend entirely on external partners.

When choosing external partners, small businesses prioritize quality of work (27%) and cost (23%), leveraging outsourcing to gain expertise, manage expenses, and successfully implement technology initiatives that keep them competitive.

The full report is available on Clutch.

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