STRATEGIES SAUDI-BASED SMES USE TO OVERCOME E-COMMERCE IMPLEMENTATION CHALLENGES AND OPPORTUNITIES FOR INCREASED ADOPTION

Abstract

The first objective of the current study was to determine the factors that limit the adoption and implementation of e-commerce platforms by Saudi-based SMEs. This study established that Saudis shopping behaviour and culture have a strong effect on the SMEs adoption of e-commerce platforms. Saudis treat shopping as a leisure activity and therefore, prefer to go to the physical shopping spaces rather than shopping online. Also, the Saudis have a culture that supports close knit families based on trust. This aspect of their culture makes customers to seek personal connections with shop owners. They build strong relationships and receive personalised services. In this regard, customers are reluctant to shop online, making it difficult for Saudi businesses to justify and make a business case for the adoption and implementation of e-commerce platforms.

This study also found that Saudi-based SMEs are unable to adopt and implement e-commerce platforms because of the high associated cost. The study established that most SMEs chose not to adopt e-commerce platforms because the cost of acquiring them and setting up the infrastructure is high. This problem is exacerbated by the fac that most Saudi residents prefer to shop in physical shops and hardly shop online. Businesses have scarce resources and will only invest in something that can increases its profits. Adopting and implementing the e-commerce platform comes with additional costs, some of which are recurrent, such as salaries of employees who run the platforms. Saudi SMEs can only adopt the platforms if they can make a business case for their adoption. Otherwise, the high cost of acquiring and setting up the e-commerce platforms will continue to deter many businesses from implementing the platforms.

The short supply of IT professionals continues to prevent IT Saudi-based SMEs from adopting and implementing e-commerce platforms. The current study has found that the nation has a shortage of IT professionals, which pushes their salaries high. Businesses have to offer them higher salaries to attract and retain them. This problem is exacerbated by the fact that SMEs compete with corporations for skilled IT personnel. SMEs lack the resources to compete with corporations and therefore lose the personnel to the larger firms. Notably, SMEs operate in a highly competitive environment and will therefore, prefer not to implement e-commerce platforms due to the high cost of employing and retaining the IT experts. The consumers’ preference for physical store shopping over online shopping coupled with the high cost of attracting and retaining IT professionals, diminishes the need for e-commerce platforms. Most SMEs cannot justify incurring the extra cost to implement IT platforms when th e returns are marginal for many businesses. This study also established that Saudi-based SMEs are unable to adopt e-commerce platforms because of the high costs of payment options and delivery systems. The study also found that a significant number of the respondents believed that Saudis were not aware of the payment options and delivery systems at their