Barriers to Canadian SME Adoption of Internet Solutions for Procurement and Supply Chain Interactions

Working Paper #5 by Norm Archer, Shan Wang, and Claire Kang, August 2003.

Background

• SMEs had fewer than 500 employees.
• Costs, low volumes and integration needs slowed SME innovation.

Survey

• A telephone survey covered B2B procurement and sales solutions.
• 173 Canadian independent SMEs were stratified by size and sector.

Findings

• 78% of companies were linked to digital networks for business.
• Online share: 5.3% of B2B purchasing and 4.6% of sales.
• 75% of medium and 55% of small firms used the Internet for information.
• 56% of medium and 37% of small firms bought some items online.
• 25% of medium and 15% of small manufacturers sold some online.

Perceived barriers

• Difficulty procuring and selling products online.
• Not knowing the right kind of online solution.
• Employees preferring the old ways of doing business.
• Little competitive pressure to go online.
• Customers not particularly interested in online interaction.
• Suppliers not promoting online solutions.
• Seeing the company as too small to benefit.
• Local-only firms did not see the value of Internet solutions.