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Business owners in New Jersey are cautiously optimistic for 2026 with moderating interest rates combined with strong financial performance and sales fueling this optimism. To achieve long term growth, stability and certainty are necessary for businesses and while the overall economy is doing well, owners are also dealing with a volatile environment as we start off the year.

There is concern about tariffs and the impact of the current geopolitical climate. The shift in how the US presents to the world is making it difficult for business owners to navigate and make decisions including where to make investments. With a great education system and many vibrant industries including transportation, distribution, warehousing, Pharma R&D and significant investments by the entertainment industry, New Jersey is a state where many can succeed.

In a survey Valley conducted at end of last year, middle market businesses reported they finished 2025 in a strong position and expressed optimism for 2026. Sentiment about cash flow jumped from 79% to 92% and profitability increased from 79% to 89%. However, businesses report that inflation and interest rates remain challenging rising from 45% to 57% year over year. The survey showed that geopolitical tensions and trade policies continue to weigh on businesses and talent remains challenging with 30% having difficulty hiring good employees and 17% report retaining talent is a struggle.

The survey also indicated that many business owners are not managing their finances well.  In fact, only 40% say they are very effective at cash‑flow management, 39% at budgeting and forecasting, 37% at cost control, 36% at profit‑margin management, 35% at integrating financial technology and 30% at working‑capital optimization. For your business to survive and thrive, it is critical to do better at executing for financial success and business growth.

To navigate this current landscape, owners and leaders should take proactive steps to ensure that their businesses are ideally positioned for growth and stability.  Some areas of focus include:

Financial Planning. Be flexible, nimble and pay attention to your business. Be a good steward of your financials by reviewing them regularly so there are no surprises. Work closely with your accountant to ensure the financials are accurate. Have liquidity and maintain it so you can take advantage if a great opportunity arises. Make sure you are not over leveraged, strengthen your balance sheet so if things soften you can weather the storm. Pay attention to accounts receivables, aggressively collect receivables and match your cash flow to capital needs. Be aware of how much debt with floating rates you have versus a fixed interest rate. Now is a good time to lock in a new lower rate. Know your capital expenditure needs 12-24 months out and build the facilities to grow with them. Meet with your banker regularly to discuss goals and needs as well as sharing any anticipated challenges. Bankers are willing to help but we don’t like surprises.

Risk Management. Fraud is the enemy to any business. Our survey showed only 30% of the respondents use fraud mitigation services and that is concerning. With AI and Deep Fakes, your staff and employees need to be aware of the risks. Have AI policies and procedures in place to ensure everyone is aware of what can be shared internally and externally. Conduct training to educate your teams so that everyone in the organization knows how to utilize tools such as AI and are aware of the risks and how to limit them. Have the appropriate business protections in place that includes fraud mitigation and cybercrime defense. It is important to balance speed to market and risk mitigation as money and time are wasted without the right protections.

Leadership. Strong and thoughtful leadership is essential to navigate today’s business environment.  Your customers and employees rely on owners and top management to set the strategy and tone. Communicate and be transparent with your employees, listen to their concerns and be receptive to their ideas.  Embrace new technologies that can improve efficiencies and assist in developing new opportunities. Plan for the next 3-5 years but be willing to shift strategies to accommodate market changes.

Companies and organizations that adopt a flexible approach and are open to take the steps to plan and navigate have the best chance for success in 2026.

Curt Lang is a trusted leader in the banking industry with over 20 years of experience. As Chief Banking Officer for New Jersey, he leads the strategic direction and drive the growth of Valley’s commercial banking portfolio across the state.

[Valley Background]

As the principal subsidiary of Valley National Bancorp (NASDAQ: VLY), Valley National Bank is a regional financial institution with approximately $63 billion in total assets. Founded in 1927, Valley has more than 200 offices nationwide and serves individuals, families, and businesses across New Jersey, New York, Florida, Alabama, California, Illinois, and Pennsylvania. With more than 3,800 employees, Valley delivers a full range of consumer, commercial, and wealth management solutions designed to support everything from homeownership and business growth to long-term financial planning. Big enough to support complex financial needs and small enough to stay deeply connected, Valley is grounded in a relationship-led approach focused on understanding people first. That same relationship-led approach guides Valley’s commitment to community investment and responsible corporate citizenship. To learn more, visit www.valley.com or call the Valley Customer Care Center at 800-522-4100.

The information in this article is for informational and educational purposes only and is not intended as specific advice for any individual or business.

Banking products and services are provided by Valley National Bank (“Bank”). Wealth management services are provided by Valley Wealth Managers, Inc. (“VWM”), a SEC-registered investment adviser and Valley Financial Management, Inc. (“VFM”), a registered broker-dealer, member of FINRA and SIPC. VFM’s SIPC coverage and supplemental SIPC coverage apply only to assets held through VFM. Registration with the SEC does not imply that VFM or VWM, or any individual providing investment advisory services on their behalf, possess a certain level of skill or training. VWM and VFM are subsidiaries of the Bank.

Non-deposit investment products offered by the Bank and its subsidiaries are:

• not insured by the FDIC or any other government agency;
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• subject to investment risks, including possible loss of the principal amount invested.

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