Wary of the bandwagon Featured

9:47am EDT July 22, 2002

The number of small businesses with a Web presence has nearly doubled since 1998, and millions more are projected to come online next year, according to a nationwide survey of small businesses [fewer than 100 employees] released late last year by Prodigy Biz Corp., a wholly-owned subsidiary of Prodigy Communications.

According to the research, approximately one-third of small businesses has a Web presence — vs. 19 percent a year ago, reported by International Data Corp.

The study, conducted by International Communications Research, was commissioned by Prodigy Biz, a small business Web hosting company. The results provide new data on the fast-growing future of small businesses using the World Wide Web.

While a rapidly growing number of small business owners recognize the global benefits of the Internet, 66 percent do not believe the Web offers significant opportunities to fuel their growth because they are local businesses.

“Small businesses can market to more than just Main Street. Even their local presence can be expanded,” said Prodigy Biz President Gary Remy. “A toymaker in Peoria can sell more dolls in her hometown, her home state, or clear across the country. The Internet shatters geographical boundaries, giving all small businesses a virtual local and national sales force with just a few clicks.”

Despite perceived geographical barriers, nine in 10 anticipate benefiting from the Internet. Small business respondents said their primary uses would be promoting to prospects [69 percent], e-commerce [57 percent], providing better customer service [48 percent], competing with other businesses [46 percent] and communicating with employees [11 percent]. Nearly 75 percent claim cost is not a barrier to setting up a Web site, although 44 percent say they do not have enough staff to maintain a site and 41 percent say they don’t have the time to do it.

The study showed the likelihood of having an Internet presence declines significantly with the overall size of the company. Only one in four companies with fewer than 10 employees has an Internet presence; 50 percent of those with 10 or more employees do.


Business Internet trends

  • The number of small businesses with Web sites has nearly doubled since 1998 and quadrupled since 1997.

  • The number of small businesses with Web sites is expected to increase by 2.1 million this year.

  • The likelihood of having an Internet presence increases by the overall size of the small business. On average, firms with 50 to 90 employees expect to a have a site within six months. Firms with fewer than 10 employees expect to have a Web site within an average of eight months.

Source: Prodigy Communications Corp.