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Is online part of your business strategy? No? Then you better read this!

06 June 2011

Earlier this month Telstra commissioned a research project from IDC covering 500 small Australian businesses with fewer than 20 employees. IDC is a global research specialist for the information technology, telecommunications and consumer technology markets.

The findings were alarming when you think about how dependent we all are on the internet and our mobiles for our social and business activities.

A few highlight points included:-

  •     More than one in ten operate without even a desktop PC;
  •    Almost a quarter still don’t use standard mobiles while 45% don’t have smart phones;
  •    Approximately half of businesses don’t have a website and don’t use online transactions in their business.
  •     71% don’t have a network that allows staff to store files that can be accessed by co-workers.


According to the ABS, the SME sector accounts for around 73% of all actively trading businesses in Australia, employing 4 million+ people or 42% of total employed persons.

It is estimated to contribute 46% of the value of Australia’s domestic production.

For a sector of the economy that is so clearly a critical part of national wealth creation to be essentially “off-line”, is a terrible state-of-play.

Communications technologies are changing our world at an incredible pace, they are changing our industries and changing our behaviours.

Just look at all the evolution on the discussion around on-line retail.

First it was all about how not many Australian’s shop online. An article in CoreIdeas notes that “although Internet penetration is strong, Australians spend one-third as much online as US consumers on a per-capita basis and one-fourth as much as shoppers in the UK.”

Then it was all about how the online world ‘levels the playing field’ so that SME’s can access and sell to consumers domestically and internationally – often with greater service levels and unique offerings.

Then it was all about how Australian shoppers are going off-shore to get access to a wider range and/or cheaper products. And now it’s about how the large retail giants in Australia are finally accepting the trend and going online themselves.

A report by Morgan Stanley forecasts online sales in Australia will grow almost three-fold by 2015, to nearly $A30 billion. When you think that the entire exporting community in NSW currently contributes between $A50 – 60 billion annually to the national coffers, its clear the online market is a critical part of our economic landscape.

I’m sure many businesses who are not “wired” intuitively understand they are perhaps falling behind.

After all, how many of us now first check the “look” of a restaurant and its menus online before we decide to eat there or  research products online before we go to a store? How many of us use Facebook, Skype or other social media to connect with friends and family globally? And how many of us even look at our business contacts LinkedIn profile before a meeting?

So perhaps the concern is cost, time and technical know-how? But there are lots of low-cost, simple options available to SME’s and you don’t have to be a tech-head to be able to understand and leverage many of the mobile and online tools available to you.

And SME owners and their teams are amazing creatures when you think about it. They have to learn and understand all sorts of aspects of business, from marketing to supply chain management, employee relations to product development. What they choose to focus on, is what they choose to prioritize as critical to the businesses long term survival.

At a networking function recently I overheard someone saying online marketing wasn’t a “serious” a business issue, cash flow was a serious business issue.

Well, in an age of online and mobile consumers, I would actually argue that without an effective online strategy you are seriously handicapping your business and by default any cash flow management strategy!

Australia’s SME’s need to prioritize connectivity. It is as essential to their business survival, as it is to their business growth.

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