German SMBs Assess Online Chances

Small- and medium-sized businesses (SMBs) in Germany already rate the business potential of the Internet sector considerably higher than in 1999, according to researchers at the German Research Institute Techconsult.

The study was commissioned by IBM and the German economic magazine Impulse. In the broad-based survey, researchers contacted 1,500 selected medium-sized businesses, that employ between 10 and 500 employees. Almost all of these (94 percent) had Internet access, although most (87 percent) principally use the Internet for the sending of emails and carrying out research. In comparison to the previous year, more decision-makers (20 percent) considered a company home-page to be crucial.

The pioneering role of smaller companies was highlighted by the study, in the way in which they are increasingly experimenting with e-commerce sites. A growth rate of 50 percent in comparison to 1999 was found. Already 16 percent of these companies are active in online trade; compared with 11 percent in 1999. 39 percent of those interviewed plan the step away from pure presentation of the company on the internet, towards generating online revenues. The quickest companies seem to be those with less than 49 employees: 41 percent of those questioned in this category intend to put an e-commerce service online soon.

Medium-sized businesses have also corrected their expectations of profitability from online trade. Compared with 28 percent in 1999, 37 percent now believe that a breakeven point can be reached in 12 to 24 months.

Every fourth business sees no particular profit to be made on the Net, compared to a figure of 8 percent in the previous year.