Barriers to SME e-Procurement Solutions in Canada: A Survey

Working Paper #7 by Cam Cuthbert, Dan Hamzic and Norm Archer, August 2003.

Background

• Many SMEs used manual procurement: paper, phone, e-mail and fax.
• Result: limited reporting, unauthorized spending and lower vendor compliance.
• Most e-procurement tools were expensive, complex and aimed at larger firms.

Survey

• The study examined barriers Canadian SMEs perceived.
• 53 companies responded, mainly by e-mail, in June and July 2003.

Findings

• Acceptance was slow compared with other Internet-based solutions.
• Many companies did not know e-procurement solutions.
• Almost half would not consider them within three years.
• Cost control and ROI were the strongest motivators.
• Security and financial support were among the lowest barriers.
• Suppliers' promotion was the favoured route; outsourcing was least favoured.
• Functionality mattered most; price mattered least.
• Medium-sized firms were more favourable than small firms.
• Managers had a limited understanding of solutions and vendors.