2024 was a difficult year for many Israeli businesses which were hit by the effects of the Iron Swords war. Unfortunately, 2025 has been ushered in with no end in sight to the war, but as this reality has become our new normal, businesses have developed strategies to survive and even to grow. Here are five strategies for scaling your Israeli business in 2025.
Utilize AI technologies
AI isn’t perfect and it hasn’t quite reached the potential of human thought, but it can do a lot for your business. AI can speed up processes, especially in the marketing sphere. It can write social media posts, create blog posts, refine your emails, provide product descriptions and generate ideas. AI works best when you give it specific instructions and provide the core information.
Say you run a jewelry making business. Instead of asking AI to write a social media post about jewelry or even about Israeli-themed jewelry, try asking it for a post about an Israeli map necklace. And for a blog post, ask for a post that discusses how the wearer of this necklace can demonstrate their Jewish pride while enjoying its high-quality workmanship. Give it as many details as you have about the necklace for the best results. A few minutes of time to ask AI the right questions will save you hours in writing marketing materials from scratch.
Make data-driven decisions
In today’s business climate, data is readily available. Free platforms such as Google Analytics, Google Trends and social media analytics, as well as multiple paid platforms, provide detailed information on your products and customers. Even a basic analysis of data can help you determine where to focus your efforts, how to spend your budget and what marketing messages to convey to your customers.
Exercise social responsibility
Customer loyalty is the backbone of any business, and in the twenty-first century, businesses that demonstrate social responsibility endanger greater loyalty. In 2025, Israeli consumers want to purchase from businesses that support the IDF and their families, evacuated citizens and others suffering from the war. They also want to buy from businesses that express their Israeli and Jewish pride openly.
Adjust prices
As of January 1, 2025, VAT in Israel has risen from 17% to 18%. If you’re a product-based business or an Osek Murshe collecting VAT for your services, you will likely want to raise prices to reflect this hike. Many businesses are taking advantage of this change to raise their prices by more than 1%. This may or may not work for your business, depending on what market you serve. Individuals are feeling the pinch in their wallets already, as prices of groceries and utilities rise, and may not be amenable to paying more for luxuries or extras.
Reevaluate business expenses
Business expenses will also rise as a result of the VAT hike, so you’ll want to reevaluate what you’re spending and whether the return on investment justifies the cash layout. If you can cut out a lot of expenses, this is a great way to increase revenue.
If your business revenue is under 120,000 NIS annually and you have no employees, you can save by switching your business to the new Osek Zair status. As an Osek Zair, you are required to do less bureaucratic paperwork and automatically receive recognition for expenses of 30% of your revenue. If your expenses are less than that, consult with an accountant or tax advisor about making this change.
Wishing you and your business much success in 2025, a victorious end to the war, the return of the hostages and a full recovery to all our wounded soldiers.