Factors impeding adoption of e-commerce by Zimbabwean small to medium enterprises: the case of Bindura urban

Abstract

This study focused on issues that impede adoption of e-commerce by Small and Medium Enterprises (SMEs) in Zimbabwe, the case of Bindura urban. Literature review has shown that technology is always developing and changes ways in which business is conducted, e-commerce is part of these technological developments that SMEs take advantage of the increase their earnings and expand their businesses. E-commerce enables SMEs to reach a wider customer base both on the local and international markets and that this mode of doing business helps in reducing costs such as advertising and travelling so that they can increase their contribution to the Zimbabwean economy. The process of adopting e-commerce has challenges that may deter SMEs even if this may be beneficial to their businesses. This research analysed these challenges and provided information on problems that are being faced by SMEs when they attempt to embrace e-commerce. The recommendations from this study will assist the Government and other stakeholders in providing the environment necessary to enable application of e-commerce by SMEs in Zimbabwe. This study looked at issues that discourage SMEs from using e-commerce in their businesses looking at the case of Bindura Urban SMEs by specifically examining SMEs perception of e-commerce, SMEs organisational and cultural factors, SMEs managerial factors, Infrastructural and economic factors as well as the legal factors. This study found out that most SMEs do not understand what e-commerce is and what benefits it can bring, some of the knowledge they have is hearsay and inaccurate, they therefore would not adopt something that they do not understand. The study also revealed that SMEs have limited financial resources to implement and maintain e-commerce. The infrastructure is not an impediment but the cost of accessing internet keeps on going up. Cultural and social factors are also barriers to implementation of e-commerce by SMEs, most SMEs and their customers are used to face-to-face transactions and do not trust paying money to someone you have never met or paying for something that they have not physically touched or tried. This study found out that although management is prepared to embrace e-commerce, they are unwilling to commit financial resources for the adoption. There is also a gap in the technical and management skills making e-commerce adoption unfavourable. The study also found out that SMEs feel that the legislature is not favourable enough for them to implement e-commerce, they do not feel protected by the law and fear that they will be swindled or will not be able to get redress when a dispute arises. The study recommends e-commerce awareness to be done especially by the SMEs, to empower the SMEs with this technology. Putting in place laws that protect SMEs when dealing on-line is recommended sine his will give these SMEs confidence. Lastly there is need to understand the extent of lack of knowledge on e-commerce by the SMEs, so a study in this area will be much helpful to the SMEs.