INTRODUCTION

In the global business environments, small- and medium-sized enterprises (SMEs) are
incrementally using information and communications technologies (ICT)-based electronic
commerce (EC) to gain competitive advantages and to have access to global markets (Al-Qirim,
2003). Increasing global competition has led businesses to consider e-business strategies. E-
business technologies present unique opportunities and challenges for businesses, and Small &
Medium Enterprises (SMEs) are no exception (Elragal, A. and Abouseif, H., 2011). Both buyers
and sellers can significantly benefit from implementation and usage of EC (Zhu, 2004), those
benefits which can also be materialized for SMEs(Al-Qirim,2007). For instance, Award (2004)
suggested that e-commerce reduces logistical problems and can “put small businesses on a par
with giants” (p.12). Other studies have found that e-commerce can reduce costs, offer quicker
and better customer service, increase sales, reduce the time between the inception of an idea
and its commercialization, and minimize supply chain inefficiencies (Turban et al., 2004;
Schneider, 2004; Award, 2004). It has been recognized that SMEs are different from large
businesses and that SMEs play an important role in the economies of their countries (Street and
Meister, 2004).

Prior EC literature has shown that only a small number of studies focused on the adoption and
use of EC in SMEs (Grandon and Pearson, 2004). Moreover, it has been found that in spite of
exponential growth of EC within SMEs, the rate of EC adoption by these businesses has
remained relatively low (MacGregor and Vrazalic, 2005) and large organizations have
noticeably profited more than SMEs in both their improved sale and costs saving
(Riquelme,2002). In looking for reasons for such differences in EC adoption in SMEs, unique
characteristics of these businesses can be highlighted. SMEs generally have limited access to
the market information and suffer from globalization constraint (Madrid-Guijarro et al., 2009).
The EC adoption literature implies that in order to adopt EC appropriately in developing
countries, firms need to be internally and externally ready (Tan et al., 2007).

This study aims to identify factors that differentiate between adopters and non-adopters of e-
commerce in SMEs. The findings can contribute to managers/owners’ understanding of how
those factors may influence e-commerce adoption. As growing industries, this will help them to
enhance their business potentials and capabilities in order to compete in the global market. This
will be an avenue for them to conceptualize effective e-business strategies to capture greater
percentage of the market. E-business technologies present unique opportunities and challenges
for Small & Medium Enterprises and this will lead them in realizing their organizational mission
and objectives. This will increase their awareness on the relevance of e-business operations
and give them insights on the proper application to their business that will highlight their future
development.
LITERATURE REVIEW
Information technology adoption has been studied by the information systems (IS) community
utilizing different approaches. For the purpose of this study, we have grouped previous
research in two different streams: those that have used pre-established behavioral intention
models to predict future adoption and those that have focused on determining factors that
influence technology adoption according to the type of technology addressed.
SIGINIFICANCE
This study contributes to the growing body of knowledge for both entrepreneurship and e-
commerce in several ways. First, this study aims to identify factors that differentiate between
adopters and non-adopters of e-commerce in SMEs. The findings can contribute to
managers/owners’ understanding of how those factors may influence e-commerce adoption.
Second, this study contributes to and extends the understanding of the Internet as a medium for
attaining organizational mission and objectives. Lastly, those interested in promoting the e-
commerce may find the results helpful in guiding their efforts.

This study contributes to enhancing the understanding of the determinants of

adopting e-commerce in SMEs and provides some interesting perspective from
Malaysia. Those parties interested in promoting their business online may find
these results helpful in guiding their efforts.
This study contributes to the growing body of knowledge for both
entrepreneurship and e-commerce in several ways. First, this study contributes
to and extends the understanding of the Internet as a medium for commercial
use in the marketplace and identifying the rationales for adopting or rejecting the
Internet-based e-commerce by the SMEs. Second, the paper examines the
factors contributing to e-commerce adoption and is unique in the research to
date. In general, the study provides more understanding of owner's/managers’
of SMEs perceptions about e-commerce adoption in their businesses. Those
interested in promoting the e-commerce may find these results helpful in guiding
their efforts.

REFERENCES
Al-Qirim,N.A.Y.(2003),“E-commerce in the aerial mapping industry: a New Zealand case study”,
Journal of Systems and Information Technology, Vol. 7 Nos 1/2, pp. 67-92.
Al-Qirim, N. (2007), “The adoption of eCommerce communications and applications
technologies in small businesses in New Zealand”, Electronic Commerce Research and
Applications, Vol. 6 No. 4, pp. 462-73.
Award, E. M. (2004), Electronic Commerce from Vision to Fulfillment. Pearson Prentice Hall,
New Jersey.
Elragayl, A., Abouseif, H.G., (2011) Experienced benefits and Barriers of E-Business
Technology Adoption by SME Suppliers
Grandon, E.E. and Pearson, J.M. (2004), “Electronic commerce adoption: an empirical study of
small and medium US businesses”, Information & Management, Vol. 42 No. 1, pp. 197-216.
MacGregor, R.C. and Vrazalic, L. (2005), “A basic model of electronic commerce adoption
barriers: a study of regional small businesses in Sweden and Australia”, Journal of Small
Business and Enterprise Development, Vol. 12 No. 4, pp. 510-27.
Madrid-Guijarro, A., Garcia, D. and Van Auken, H. (2009), “Barriers to innovation among
Spanish manufacturing SMEs”, Journal of Small Business Management, Vol. 47 No. 4, pp. 465-
88.
Street, C. T., and Meister, D. B. (2004), “Small Business Growth and Internal Transparency:
The Role of Information Systems,” MIS Quarterly, 28(3), pp. 473-506.
Tan, J., Tyler, K. and Manica, A. (2007), “Business-to-business adoption of eCommerce in
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Turban, E., King, D., Lee, J., and Viehland, D. (2204), Electronic Commerce. A Managerial
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Riquelme, H. (2002), “Commercial internet adoption in China: comparing the experience of
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It is the conduct of business on the Internet, not only buying and selling but also servicing
customers and collaborating with business partners. Many companies are rethinking their
businesses in terms of the Internet and its new culture and capabilities. Companies are using
the Web to buy parts and supplies from other companies, to collaborate on sales promotions,
and to do joint research. Exploiting the convenience, availability, and world-wide reach of the
Internet (Rouse, M., 2005).
The incredible advances of information technology have changed the face of the business-to-
business transactions. Business buyers are purchasing all kinds of products and services
electronically. Such cyber purchasing gives SMEs access to new suppliers, lowers purchasing
costs, and hastens order processing and delivery (Armstrong and Kotler, 2004). Increasingly,
many companies were racing feverishly to build online platforms for their core businesses.
Some built online channels to improve efficiency, while others built them merely to keep pace
with competition (Shabazz, D., 2004). In such a dynamic environment, firms must be able to
continually evolve their capabilities to facilitate business operations (Lin and Hsia, 2011).