E-Commerce Among OK Value-Added Entrepreneurs Glenn Muske Rodney Holcomb Mike Woods E-commerce Oct, 2001

Research Objectives  Identify start up & growth road blocks for value-added business owners  Examine information technology use –Access & ability to compete in global market

Literature  Medium to Large Business – 80% have sales web site  Small Business – 50% have sales web site –Small Business Computing, May, 2001

Methods  Telephone Survey –274 Micro business owners 10 employees or less –70% Response rate N=193 –103 Value-added businesses 71 food 32 other agriculture

Total SampleValue-Added 54%Male56% 51Mean Age51 23%Farm28% 25%Rural, Non farm22% 24%City> 50,00018% 3# employees3.2 Demographics

Reasons to Start Control/Independence50% Financial18% Use Ag Output12%

All RespondentsValue-Added 87%WP83% 80%Financial83% 62%Graphics60% 45%Production49% 51%Publications55% 59%Database62% 89%Internet90% Technology Use

Internet Use 96% 66%Marketing Information 68%Customer Information 46%Leads 42%Customer Service 39%Purchasing 38%Travel 28%Non Web Sales

Why not?  48% Lack of Knowledge/Desire

Overall Profit All RespondentsValue-added 29%033% 21%<$50021% 18%<$25,00015% 6%>$75,0004%

Web site Owners (n=34) No Web site (n=69) 67%Male51% 51Mean Age51 29%Farm28% 21%Rural, Non farm23% 27%City> 50,00015% 3.6Avg # employees3 Value-Added Owner Demographics

Reasons to Start (Web site vs No Web site) Control/Independence62 vs 44% Financial 9 vs 23% Use Ag Output15 vs 10%

Web Development  # with web sites – 34  Average # months on Web –18  Who designed? –Company – 57% –Individual (not owner) – 29%  Who maintains? –Company – 38% –Self – 35% –Individual (not owner) – 27%

Web Site Owners  Web Revenue –Mean = $7430 –Median =  Web Expenses –Mean = $1435 –Median = $500

Web Profit  Mean = $6359  Median = $1500  35% Earn $0 or less  12% Earn $19,500 or more  3% Web decreased overall profit  6% Web added to overall profit

Web Site Sales All Web Owners Value- added on Web50% of sales within Value-added –No Web 37%36%<50 miles in OK63% 12%13%>50 miles in OK6% 19%6%Surrounding States6% 24%13%U.S.0% 3%0%World0%

Significant Factors of Value- added Web Owners  Sell less with in 50 mile radius  Sell more outside of 50 mile radius in OK  Sell more in U.S.  Want to increase sales  Added new product/service  Improved customer service

Significant Factors of Value- added Web Owners  More likely to have used OK Coop. Ext.  More likely to expand somewhere else –Rural person more likely to move outside county  More likely to have had business training  More use of computer –Finance, Internet, purchasing, customer info, leads

Significant Factors of Value- added Web Owners  More likely to have modified goals because of awareness of complexity  More likely to feel have adequate financing  More full-time employees (2.8 vs 2)  More likely to say quality evaluation a problem

Affect of Time with Web Site  Profits not significantly different –Substantial $9983 (≥ 18 months) vs. $3138 (< 18 months)  Sites ≥ 18 months –More interested to expand U.S. sales –More likely spouse has a job outside –More likely to be “other ag” business

Web Satisfaction  With contacts –46% Somewhat or very satisfied  With sales –46% Somewhat or very satisfied

Web Problems 35%None 19%Development 23%Updating 12%Hits 12%Other

More Information Glenn Muske Micro & Home-Based Business Specialist OK Cooperative Extension Service