Small firms get high-tech help
By Staff -- Industrial Distribution, 8/1/1998
New york, N.Y.--Small-business owners appreciate the value of technology, but when it comes to what technology to buy, where to purchase it, and whom to turn to for help and advice, most express uncertainty and are reluctant to take risks. That's according to a new study of U.S. small business and technology sponsored by IBM and the U.S. Chamber of Commerce.Yankelovitch Partners, Inc. conducted the survey of more than 1,000 companies, which was commissioned by IBM and the U.S. Chamber. In addition to looking at perceptions and use of technology, the survey examined the make-up of small business, its regional differences, its most active industries and more.
In response to the survey findings, IBM, the U.S. Chamber, and the U.S. Small Business Administration announced in June plans to launch a public-private sector initiative to promote new opportunities for small business through information technology. Called the "Small Office Solutions" initiative, the program involves a sweeping five-part national assistance effort to educate small businesses on the benefits of technology.
"It's no coincidence that this year's Small Business Week theme is "Small Business: Success Through Technology," SBA administrator Aida Alvarez said in a statement. "We live in an increasingly technology-driven economy and small businesses must take advantage of technology to compete across the country and around the globe."
John W. Thompson, general manager, IBM North America, echoed Alvarez's comments.
"Small-business owners sent up an SOS when they told us they are often confused by technology," Thompson said. "We want them to know we heard their message loud and clear."
Among the survey's findings:
* Ninety percent of small businesses report using technology for accounting, finance, and billing, while more than 50 percent use technology for 10 core business functions. Also, 96 percent report owning a PC and 83 percent report having a modem and a CD-ROM drive.
* Sixty-seven percent have Internet access and 24 percent have a Web site. Of those with Internet access, 30 percent use it to promote their services, half use it to find out about potential customers, 63 percent use it for answers to specific questions and almost all (85 percent) use it for e-mail. Just 25 percent of those surveyed report being familiar with e-commerce.
* Most small businesses are cautious about technology. Sixty-one percent buy after technology is proven, 31 percent wait for price to come down, and 54 percent wait to hear of others' experiences before buying.
* Most spend relatively little on technology, averaging $7,000 per year, or eight percent of total expenditures. Specifically: minority-owned firms spend 12 percent of annual expenditures, female-owned firms spend nine percent, and male-owned firms spend seven percent.
The "SOS" Initiative is designed to address the information needs of small companies. The program offers small-business owners several routes to reliable expert guidance on technology issues by combining the expertise of IBM, and the national reach of the U.S. Chamber and the SBA. Free to small businesses, the initiative includes:
* "Small Business ThinkCenters," a pilot program that will create fully staffed technology help centers at selected local chambers of commerce
* A free, "Small Business Toolkit" of information and resources
* A new interactive Web site with which small-business owners will be able to assess their technology needs
* Toll-free help lines
* Informational videos and other materials
Three of the SBA's current Business Information Centers (in Albany, N.Y.; El Paso, Tex.; and Spokane, Wash.) will serve as Small Business ThinkCenters, as will the Chicagoland Chamber of Commerce. IBM will provide technology-related services. The groups expect to add more ThinkCenters as the program continues its national rollout.
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