One of the most powerful forces affecting the world's economy and commerce today is the substantial increase in globalisation through the use of Information and Communications Technologies (lCTs). Kaynak et al (2005) suggest that the rapid emergence of E-commerce has changed the nature of business so quickly and pervasively that where once it was revolutionary, now, it is simply evolutionary.
There have been many studies of E-commerce in the small business sector (van Slyke et al 2005, Kaynak et al 2005, MacGregor et al 2005). A number of reasons have been put forward but principal among them has been the realisation that both at an academic as well as a government level that the small to medium enterprise (SME) sector is one of the cornerstones of economic prosperity in many countries (NOIE, 2002, MacGregor et al 2005). Studies (Taylor & Murphy 2004, Scupola 2003, European Commission 2002, Stockdale & Standing 2004) have shown that many SMEs are turning more and more to global markets.
Despite the advocacy by governments that it is becoming a critical necessity for SMEs to involve in E-commerce, studies in Europe, the US and Australia (Martin & Matlay 2001, Dixon et al 2002, Buckley & Montes 2002) have found that SMEs are less engaged with ICTs than their larger counterparts and, indeed, invest less in these technologies per employee than larger firms. Recent studies (OECD 2002, Taylor & Murphy 2004, Dixon et a12002) have found that while over 20% of SMEs purchase through the web and more than 30% sell through the web, the value of these purchases and sales only account for 2% of the total.
The slow pace of E-commerce diffusion in the SME sector has led to a variety of studies, both at an academic level as well as through government initiatives. These studies have concentrated on barriers to adoption, benefits derived through Ecommerce adoption and problems encountered by SMEs in their move towards E-commerce adoption.
This paper presents a study of Swedish regional small businesses which investigated the barriers to E-commerce adoption (amongst other things). The aim of the paper is twofold: to examine the correlation between barriers to Ecommerce adoption in order to identify underlying factors: and to determine whether these differ between SMEs that are members of a small business cluster and SMEs that are not. The paper begins by examining the nature of SMEs and identifying features that are unique to SMEs. A discussion of barriers to Ecommerce adoption based on previous research is then presented and the barriers are mapped to the unique SME features. The paper will then briefly examine the role of small business clusters in the adoption of E-commerce. This is followed by a correlation and factor analysis of the two sets of data and a discussion of the results. Finally, the limitations of the study are presented and conclusions drawn.