The Use and Value of Web Sites

1. 1

   Fifty-seven (57) percent of all small employers use the Internet for business-related activities. The most common business applications of the Internet in small firms are communicating by e-mail with suppliers and customers and gathering business-related information, such as prices, new products, etc.

2. 2

   Sixty-one (61) percent of small employers on the Internet (35% of all small employers) report they have a business Web site. Most were created recently. The average life span of small-business Web sites is just 21 months.

3. 3

   Small-business Web sites most often generate income indirectly. They stimulate potential customers to buy, but the actual transaction usually occurs in the small employer’s place of business or by phone, fax, or e-mail. Just 24 percent with a Web site report sales made directly from their sites.

4. 4

   The overwhelming majority of sales made directly over the Internet by small businesses are made to consumers and non-business entities.

5. 5

   Twenty (20) percent of those selling directly over the Internet charge sales tax on everything sold; 33 say they charge it on some sales; 42 percent charge sales tax on none of their Internet sales. The current turmoil regarding the applicability of state sales tax on Internet transactions leaves small-business owners confused over their legal responsibilities.

6. 6

   The cost of creating and operating a Web site, both in direct outlays and employee hours, appears modest. However, about one in three does not know the cost suggesting that the site is not a cost center or that the cost is negligible.

7. 7

   The most frequently noted benefit of a Web site is additional customers. However, just eight percent feel the site has increased business profits.

8. 8

   The most frequently cited reason for not having a Web site (by those on the Internet, but not having one) is that their products or services don’t lend themselves to sale on the Internet. The next most frequently mentioned reason is that they simply don’t see any benefit in having a site. However, nearly half expect to have one in the next 12 months.

9. 9

   One-third of those not now using the Internet for business-related activities expect to be on the Internet within the next 12 months.

10. 10

    Sixteen (16) percent report not using a computer in their businesses. This percentage is virtually unchanged over the last four to five years.

11. 11

    Though high-speed Internet service is available to relatively few small businesses, almost 60 percent of small employers believe that they have access to it and another 16 percent are not sure. However, those who thin that high-speed Internet provides no competitive advantage outnumber those who think it provides a significant competitive advantage by 6 - 1.

Volume 1, Issue 2, 2001
ISSN 1534-8326

William J. Dennis, Jr.
NFIB Research Foundation

• 1Are you and/or your employees using the Internet for business-related activities?
• 2Do you use a computer in your business’s operation?
• 3Do you expect that you or your employees will use the Internet for business-related activities within the next year?
• 4Do you expect to have a Web site within the next year?
• 5Why don’t you expect to have your business on the Internet within the next year? Is it because you:?
• 6Do you expect to begin using a computer in your business within the next year?
• 7Why don’t you expect to have a computer in your business within the next year? Is it because:?
• 8A(business activity on the Internet) Use e-mail to communicate with customers or suppliers.
• 8B(business activity on the Internet) Purchase goods and/or services.
• 8C(business activity on the Internet) Conduct financial affairs, such as on-line banking.
• 8D(business activity on the Internet) Bid on contracts.
• 8E(business activity on the Internet) Gather business-related information, such as prices, new products and so forth.
• 9Does your business have a Web site?
• 10Do you sell goods or services directly over the Web site?
• 11A(reason for no Web site sales) The initial cost is too high.
• 11B(reason for no Web site sales) Your products and services don’t lend themselves to sale on the Internet.
• 11C(reason for no Web site sales) Of too much on-line competition.
• 11D(reason for no Web site sales) You haven’t gotten around to it yet.
• 11E(reason for no Web site sales) Of the amount of time it would take.
• 11F(reason for no Web site sales) The infrastructure is not yet available.
• 11G(reason for no Web site sales) You don’t know how to do it.
• 11H(reason for no Web site sales) You don’t see any benefit from it.
• 12A(reason for no Web site) The initial cost is too high.
• 12B(reason for no Web site) Your products and services don’t lend themselves to sale on the Internet.
• 12C(reason for no Web site) Of too much on-line competition.
• 12D(reason for no Web site) You haven’t gotten around to it yet.
• 12E(reason for no Web site) Of the amount of time it would take.
• 12F(reason for no Web site) The infrastructure is not yet available.
• 12G(reason for no Web site) You don’t know how to do it.
• 12H(reason for no Web site) You don’t see any benefit from one.
• 13Do you expect to have a Web site a year from now?
• 14How many months has your Web site been operating?
• 15A(income from Web site) Sales directly on the site.
• 15B(income from Web site) Sales stimulated by the site, but made over the telephone, fax, or e-mail.
• 15C(income from Web site) Sales stimulated by the site, but made in your place of business.
• 15D(income from Web site) Ads on your site.
• 15E(income from Web site) Paid subscriptions to the material on your site.
• 15F(income from Web site) Commissions for directing business to another site.
• 15G(income from Web site) Any other way.
• 16Over the last three to six months, have the revenues from your Web site been higher, lower, or about the same as the cost of operating and promoting the site?
• 17Approximately what percentage of your Internet sales are to other businesses?
• 18Approximately what percent of your CURRENT total sales do you make, directly or indirectly, as a result of your Web site?
• 19What do you think that percentage will be 12 months from now?
• 20What do you think that percentage will be five years from now?
• 21Sales tax is not required on most Internet sales transactions. Do you charge sales tax on all direct Internet sales, some sales, or no sales?
• 22Please estimate the DIRECT costs of building your Web site, including fees for outside consultants, or service providers?
• 23Please estimate the number of hours you and/or your employees put into building your Web site?
• 24What is the average MONTHLY cost of operating your Web site?
• 25What is the estimated number of employee hours put into operating your Web site per month?
• 26A(benefit of Web site) Increased your total sales.
• 26B(benefit of Web site) Brought you additional customers.
• 26C(benefit of Web site) Brought you new types of customers.
• 26D(benefit of Web site) Reduced your costs per unit sold.
• 26E(benefit of Web site) Increased business profits.
• 26F(benefit of Web site) Increased sales outside the United States.
• 26G(benefit of Web site) Improved your competitive position.
• 27Does your business have access to high-speed Internet service if you wish to use it, or don't you know?
• 28Do you believe access to high-speed Internet service gives your business a significant competitive advantage, a minor competitive advantage, no competitive advantage or are you unsure?
• 29Do you believe the LACK of high-speed Internet service creates a significant competitive disadvantage, a minor competitive disadvantage, or no competitive disadvantage for your firm, or are you unsure?