E-Commerce in Small and Medium Enterprises in Sri Lanka

E-Commerce in Small and Medium Enterprises in Sri Lanka

Kennedy D. Gunawardana (University of Sri Jayewardenepura,, Sri Lanka)
DOI: 10.4018/978-1-7998-1760-4.ch034

Abstract

The growth of information technology in the business world is spreading at a phenomenal rate. The success of a business organization stands at the usage of IT in their business. Growth of e-commerce is the new born business method, which has originated through an extensive usage of IT in their business. This study will focus on the level of adoption of e-commerce in a population of 30 SMEs under the BOI, the relationship between firm-based characteristics and the adoption of e-commerce and also more importantly find out the critical success factors and discover potential benefits of adoption of e-commerce in SMEs. The results on the adoption of e- commerce showed a significant relationship with the two firm-based characteristics. That is management involvement and adoption of IT. The study also identified e- marketing and supplier service as the critical success factors in adoption of e-commerce.
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2. Literature Review

There have also been a number of perspectives investigated with regard to e-commerce adoption and SMEs in recent studies. Of particular interest is the study by Wymer and Regan (2011) who have investigated the influential factors in the adoption of e-business and e-commerce technologies by SMEs. Further to this, Grandon et al. (2011) have compare e-commerce adoption theories, While Neilson et al. (2010) have examined the international perspective of the development of e-business by wine industry SMEs, and Beynon-Davies (2010) has considered e-business as a regional development driver. Additionally, scupola (2009) has studied the perspectives of e-commerce adoption by SME s in Australia and Denmark, and Williams et al. (2010) have explored small business sale growth in the UK and internationalization links to web site functions.

Sterrett and Shah (1998) and Stockdale and Standing (2004) have argued that micro-sized SMEs can compete with larger organizations through e-commerce as their size enabled them to be more adaptable and responsive to changing condition. Effective e-commerce deployment thus means that enterprises are no longer restricted by geographical locations and are able to compete in new national and global markets, both for customers and suppliers (Damanpour, 2001: Dholakia and Kshetri, 2004). In terms of financial support, Schneider and Perry (2001) and Galloway and Mochrie (2005) have suggested that SME owner/managers require support from government and support agencies to enable an effective transition in mindset. Such support can take multiple forms including business advice and/ or financial backing in grants and loans.

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