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Report Slams Ireland's E-Commerce Policy

by Jason Gorringe, Tax-News.com, London

13 September 2010


The Irish Small and Medium Enterprises Association (ISMEA) has slammed government inaction with regard to its ‘smart economy’ initiative, citing a recent survey of Irish businesses that has exposed a dramatic lack of e-readiness.

In its survey of Irish businesses, ISME found that:

  • Only one in four businesses use the Internet for online sales, primarily due to inadequate Internet infrastructure;
  • The average cost of set-up of a web site was EUR4,000 (USD5,100), with an average annual maintenance expense of EUR900;
  • Companies who do not have a website indicated a lack of in-house expertise (30%) and costs (20%), as the main determiners;
  • In addition, many businesses complained of high cost and low quality broadband; and
  • Lastly, just 39% of businesses active on the Internet reported cost efficiencies as a result.

Meanwhile:

  • There has been a significant increase in Internet-related business reported;
  • 98% of businesses reported to use the Internet as part of their operations, with the main purposes being for: banking (88%), communications (84%), sourcing suppliers (70%) and marketing (58%).

Presenting its report, ISME said:

“The government must get serious about the “Smart Economy” before we (Ireland) become the laughing stock of the developed world. Our survey shows that while ICT usage increased among SMEs, including the Internet and e-mail, the reality is that a major opportunity is being missed, with only 28% of enterprises using the Web for online selling, in part due to inadequate broadband infrastructure.”

“While there is an increasing appreciation of the contribution of ICT to the development of their businesses, SME owner-managers continue to use ICT more for information and communication purposes than for online selling. The main reasons for not exploiting Internet sales was the availability, standard and cost of broadband and, to a lesser extent, the lack of expertise within the company.”

Commenting on the survey results, ISME Chief Executive, Mark Fielding, observed:

“ICT and all forms of digital media have become essential tools for business and will have a critical role to play in enhancing competitiveness and increasing employment. The lack of adequate broadband is a major obstacle for businesses wishing to sell on-line. The government must act on the broadband issue to ensure that Irish SMEs are able to use the technology as a sales and marketing tool, essential in today’s climate.”

“In just a few short years the nature of transacting business has been transformed. It is imperative that, as part of the government’s Smart Economy agenda, the role and usage of ICT in SMEs is exploited to its fullest, so that companies are in a position to avail of the most up-to-date technology at the most convenient cost.”

“Training and investment initiatives, together with improving the country’s broadband network, are essential components in ensuring that SMEs can compete in the global market.”

TAGS: business | Ireland | commerce | banking | international financial centres (IFC) | internet | e-commerce

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