The Adoption of e-commerce in SMEs: An Empirical Investigation in Egypt

Abstract

The Adoption of E-commerce in SMEs: An Empirical Investigation in Egypt It is recognised widely that e-commerce can offer substantial opportunities for Small and Medium sized Enterprises (SMEs) to compete in the global market. In developing countries, e-commerce opportunities can be a meaningful approach for SMEs to be able to compete with large businesses and to access, with lowest possible costs, international markets. However, the current situation shows that SMEs continue to lag behind in maximising their capabilities in taking these chances. Universally, they are reported to be slow adopters of new technologies as a result of limited financial resources and lack of expertise. The importance, of SMEs, emerged from their positions since they contributed more than 90% to many developed or developing countries’ economies and they were considered to be the backbone of any economy. Hence, the main purpose, of conducting this research, was to increase the body of knowledge about the process of the adoption of e-commerce. This was done by a primary empirical focus on small and medium sized enterprises (SMEs) in Egypt. SMEs represented about 90% of all Egyptian businesses (ITP, 2012). This study aimed to investigate the factors which could influence the SMEs’ adoption of e-commerce. In order to accomplish this objective, the researcher investigated the previous studies, on the same approach, in order to identify the gap, within the literature, regarding the adoption of e-commerce amongst SMEs. Additionally, the researcher integrated existing theories on the adoption of innovation in order to develop a conceptual framework for the determinants of the adoption of e-commerce in the SMEs sector. The researcher reviewed the Diffusion of Innovation (DOI); Resource Based View of the Firm (RBV); Technology–Organization–Environment (TOE) Model; and Technology Acceptance Models (TAM) to give constructive information about the firm and decision makers, within the firm, who were believed to have an impact on the adoption of innovation. 3 The proposed model was tested using quantitative research data. The data was collected by means of an online questionnaire survey and, subsequently, due to the high rate of non-respondents, changed to a face-to-face survey. A total of 130 usable responses were generated for purpose of analysis. The study contributed to the existing research by providing valuable information about the factors which influenced the SMEs’ adoption of e-commerce. As the results showed, there were 6 groups of factors which impacted mainly on the adoption processes. Namely, these were: Decision maker characteristics (education level, position within the firm, management support, management attitude); organisational characteristics (firm activity, firm size, firm’s assets/capital, firm age, employee’s IT knowledge, firm marketing capability); innovation characteristics (Perceived Relative Advantage); e-readiness (Individual and organisation e-readiness); government support; and barriers to e-commerce. This study’s findings offered important information for Egyptian government, policy makers and managerial participants; those were the people who encouraged the Egyptian SMEs to adopt e-commerce. These findings could be generalised to be applied to other countries with similar conditions to Egypt, as well as being applicable to Egyptian SMEs in other sectors.