New report says small businesses lag big firms in using broadband
May 31, 2012
A report issued by Connect Michigan finds that small employers are missing some business opportunities by failing to take advantage of broadband Internet connectivity in the workplace. The Broadband: Empowering Small Businesses to Grow and Thrive report is available online. Hear an interview with Eric Frederick, State Program Manager for Connect Michigan, on Mon. June 4 on SBAM’s Business Next audio seminar on the Michigan Business Network.
Key findings from this report:
- About two out of three Michigan businesses with fewer than 20 employees use broadband, which is significantly lower than among larger Michigan businesses
- Fewer than one-half of small Michigan businesses have websites, and they are also significantly less likely to allow their employees to telework or use Voice over Internet Protocol (VoIP) to communicate compared to businesses with 20 employee or more
- Nearly four out of five broadband-connected businesses with fewer than 20 employees (79%) go online to buy or place orders for products or services, the most popular online application among these businesses
- Broadband-connected Michigan businesses with fewer than 20 employees report median annual revenues of approximately $300,000, compared to just $100,000 among similarly-sized competitors that do not use broadband
- Statewide, nearly three out of ten (29%) businesses with fewer than 20 employees earn at least some of their revenues from online sales; on average these businesses earn about one-third (34%) of their revenues from online transactions
- Statewide, businesses with fewer than 20 employees generate nearly $6.9 billion in online revenues for Michigan
Availability is the main barrier reported by one in ten small Michigan businesses that do not subscribe – this translates into approximately 6,000 Michigan businesses that could go online if broadband were available to them
The report was released at the Michigan Collaborative Broadband Committee (CBC) meeting in Lansing. The CBC is a group of representatives from K-12 education, higher education, broadband service providers, non-profits, tourism, business, agriculture, government, and other organizations that have an interest in improving Michigan’s broadband availability and encouraging meaningful adoption.
“High-speed broadband is an essential catalyst for the growth and expansion of small businesses here in the state of Michigan,” said Tremaine Phillips, Chief Program Officer with the Prima Civitas Foundation. “Cloud computing and telecommuting can greatly reduce the capital expenditures of small businesses and start-ups. While ultra-high-speed broadband is becoming increasingly available, businesses that are unable to utilize these tools are placed at a competitive disadvantage globally.”
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