The objectives of this study were to determine the current level of e-commerce adoption and factors that motivates the adoption by Small and Medium Enterprises (SMEs) in Pretoria East. A structured questionnaire survey was distributed to 200 randomly selected small and medium enterprises and 48 valid responses were obtained. The results indicate that 67 percentage of SMEs in the sample in Pretoria East have somewhat embraced the adoption of e-commerce. Retail is the largest industry sector in the sample followed by Service industry with 45.8percentage and 35.4 percentage respectively. The results also indicates that Service sector was at adoption level 2 followed by Retail and others. The results show that only three independent factors namely (relative advantage, competitive pressure, IT knowledge) were statistically significant. Relative advantage emerged as the most important factor influencing the adoption of e-commerce among SMEs in terms of relative importance. The Chi-square test indicates that the type of business, occupation level, numbers of employees in the company and academic qualification did influence the adoption levels amongst SMEs whilst how long as owner/manager and gender did not influence the adoption level.
Keywords:Adoption, E-commerce, Small and medium enterprise, Pretoria.
INTRODUCTIONAccording to SME Survey (2012), the small and medium enterprises (SME) sector in South Africa accounts to 40% of GDP and 60% of the workforce in the formal employment. The World Wide Worx Report indicates that more than R2 billion was spent on online shopping in South Africa in 2010 but the rate of e-commerce adoption on SME is still rather low.Electronic Commerce (e-commerce) has been predicted to be a new driver of economic growth for developing countries (Humphrey et al.2004:31). Adopting e-commerce has not been easy for SMEs world-wide (Jones et al., 2011) partly because of the everchanging field of information systems and the varying needs of local and global business in general. The adoption of e-commerce in SMEs remains a critical area of investigation in information systems research (Parker and Castleman, 2009;MacGregor, 2004). Previous studies of Information and Communication Technology (ICT) and e-commerce adoption report that SMEs in developing countries generally have not capitalised on the power of the Internet to extend their business beyond traditional borders (Bai et al., 2008;Molla and Licker, 2005a;Humphrey et al. 2004) except in the application of simple technologies such as electronic mail (Mpofu and Watkins-Mathys, 2011). Some of the reasons put forward from the literature include: cost of acquiring and operating ICT, lack of ICT and e-commerce knowledge, owner/manager low literacy levels, inability to perceive e-commerce benefits, unfriendly regulatory policy and requirements, cultural issues and dependence on customer or supplier preferences. According to Cragg, Caldeira and Ward (2011), a low level of 1 Corresponding author EJISDC (2015) 68, 7, 1-23 The Electronic Journal ...