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Small Business Research Board eCommerce Study: Nearly 30% of Small Businesses Expect Internet Sales to Increase Next 12 - 24 Months According to Lates

NORTHFIELD, Ill. (BusinessWire EON) August 31, 2007 -- Owners and managers of more than 550 small businesses representing numerous industries responded to the nationwide SBRB poll co-sponsored by Business Today Magazine. While nearly 97% of the respondents said they expect revenue generated from web-based sales to stay the same or increase during the next one to two years, 29.2% of those said they expect revenue to increase. The poll indicated that 67.5% of the respondents believe their Internet sales will remain the same during this same period and 3.3% of the respondents predict that their Internet sales will decrease.

The SBRB / Business Today Study also demonstrated a great divide exists between businesses which have explored the Internet and those that have not embraced the media.

"The importance of this study extends far beyond predicting revenue trends," said Gregg M. Steinberg, President of Business Today. "The information clearly illustrates that there are many companies which are either not availing themselves of the opportunities to sell products and services on the web and thus losing the opportunity to generate additional revenue.

"While the web may not be suitable for every business, there are many companies which have integrated eCommerce capabilities into their Internet sites are generating sales -- and expecting the web to continue growing as an important revenue source," Steinberg added.

To that point, 42.7% of the respondents indicated their firms do not have websites. The majority of firms (47.3%) had one web site while 7% of the business had between two and five websites, 2.1% had six to ten websites, and .9% had more than 10 sites.

Similarly, 67.8% of the total respondents said they don't sell any products nor services on the web. Of the remaining group, 25.7% said they sell products on one of their sites, 5.1% said they generate revenue from two to five sites, .4% from six to ten sites and 1% from more than ten sites.

Backing out those which do not have websites and thus including only those business with websites, 43.9% of that group do not sell products or services. The vast majority of 44.8% have one site in which they conduct eCommerce while 8.9% said they have two to five sites in which they conduct eCommerce.

Nevertheless, the number of businesses which reported generating revenue from their Internet sites increased 2.5% for the total population of participants from 2001 to 2006 and 4.3% for only those respondents which had Internet sites.

A total of 17.5% of the respondents which had Internet sites in 2006 said they generated up to 10% of their company's total revenue from Internet revenue. Another 14.4% said they generated from 11% to 25% of their revenue from eCommerce and 10.4% said they generated from 26% to 50% of their overall revenue from their Internet sites. Of the remaining participants, 3.1% said they produced 51% to 75% of their revenue from eCommerce and 4.9% produced 76% to 99% of their revenue. eCommerce contributed 100% to the revenue of 3.1% of the respondents.

The SBRB / Business Today Small Business eCommerce Study is believed to be among the most comprehensive efforts recently undertaken to understand eCommerce and the reality of its impact on small businesses. The resulting information thus provides both a snapshot on current attitudes and realizations among small business owners as well as establishes benchmarks.

Among the questions asked were:

-- How many websites does your company own?

-- On how many of these websites do you sell products / conduct transactions?

-- What percentage of your product line can be purchased on your Internet site?

-- How much of your sales were transacted on your Internet site(s) last year?

-- Over the next 12 to 24 months do you expect your Internet sales to increase, decrease or remain the same?

Poll participants also were asked to provide information on the percentage of products and services that could be purchased on their websites five years ago as well as the correlating percentage of sales that were derived. This data contributed to helping establish trends and historical benchmarks.

The study provides data for the all participants and also delineates data pertaining to only those businesses which have Internet sites.

Consistent with the comprehensive nature of the SBRB / Business Today Study, the data is further delineated by size of business, US region (and several larger states) as well as by industry. Results are broken into revenue size categories ranging from $0 - $500,000; $500,000 to $1 million; $1 million to $2.5 million; $2.5 million to $5 million; $5 million to $10 million; $10 million to $25 million; and more than $25 million.

Data is included for such industries as manufacturing, construction and contracting, retail, food and beverage, distribution and wholesaling, transportation and automotive.

The results of the initial poll, which the SBRB intends to update at least twice annually, indicate that the larger small businesses (those with annual sales of $25 million or more) are the most optimistic about Internet sales, with 48.15% predicting an increase during the next 12 to 24 months, an equal number expecting eCommerce based revenue to remain the same and 3.7% predicting sales to decrease.

By contrast, owners of the smallest businesses, those with revenue of $500,000 or less, were the second most optimistic group with 36.2% saying they expect eCommerce revenue to grow.

Business Today Magazine is dedicated to serving the information needs of owners and managers of small businesses. The primary goals of the quarterly publication based in Buffalo Grove, Il. is to inform and educate its readers by providing timely, useful information that will help readers both contend with the daily demands of running their businesses as well as provide insight on achieving long term growth.

The Small Business Research Board ascertains and reports the opinions of small business owners and managers on a wide variety of topics related to their own businesses as well as national and international issues that may impact their operations. The SBRB conducts these studies for the benefit of small business owners and managers. The SBRB also provides opportunities for third parties to gain real time insight into the attitudes of small businesses nationwide through the independently conducted research.

The latest information about the Small Business Research Board can be found at www.biznus.net.

Small Business Research Board / Business Today

Selected Results of National eCommerce Study

-- August 2007

Number of websites owned by individual small businesses

none 42.7%

1 47.3%

2-5 7.0%

6-10 2.1%

Over 10 0.9%

Percentage of product line available on company Internet sites

None 68.0%

1-10% 9.1%

11-25% 7.9%

26-50% 5.6%

51-75% 2.6%

76-99% 2.1%

100% 4.7%

Expectations for revenue generation next 12-24 months

Increase 29.2%

Remain 67.5%

Decrease 3.3%

Small Business Research Board / Business Today eCommerce Selected Results

NOTE TO EDITORS: This article is the first of a series on the study of small business, the Internet and eCommerce.

Additional stories will be released regarding the findings by size of business, region, several states (including New York and California) and by industry, among them manufacturing, construction and contracting, retailing, food and beverage, distribution and wholesaling, automotive and transportation.

For more information about this poll, copies of the complete study and the results of previous studies or other matters related to the Small Business Research Board, please contact Raymond D. Minkus, (847) 441-4192.