Dun & Bradstreet: Small Business Still Spending On Technology

Computers and the Internet play essential roles in the daily operations of small businesses in America, and reliance on them is expected to increase during the coming year.

That's the conclusion from a Dun & Bradstreet study of the small business market, and it seems to offer a much more positive outlook for technology spending than do other economic surveys involving larger companies.

The Dun & Bradstreet study involved 540 interviews with owners and senior executives of small businesses with 25 or fewer employees. The survey was conducted in March and April and released earlier this month.

Dun & Bradstreet found more than 80 percent of small businesses have at least one computer on site used for business purposes. Some two-thirds of small businesses have Internet access, and approximately half of those businesses also maintain a Web site. According to the survey, 60 percent of the small businesses that have Internet access also plan to increase their Internet use in the coming months.

However, it is the outsourcing area that seems to offer the most positive news for solution providers. According to the survey, more than half of the respondents--some 55 percent--rely on external specialists for their technical support. Approximately one-third use outsourcers for Web design and Web hosting. Only 30 percent of the companies depend on their own employees for Web design and 21 percent for Web hosting.

"Companies that are more likely to use external specialists for computer technical support include those in the real estate sector, those with sales volume [of] $50,000 or more and those businesses that serve business or commercial accounts," according to the survey.

Companies that turn to external Web hosting companies tend to be those in business less than 20 years, have sales volumes of $50,000 and more and operate in the business services, services or manufacturing verticals.

The survey also found small businesses rank technology spending relatively high in their list of priority spending.

Despite the current economic slowdown, 28 percent of the respondents say they'll make a "significant investment" this year in computer equipment. That's a higher figure than the expected investment in such areas as telecommunications, new product design, employee recruitment or facilities. Some 24 percent say they'll make a significant investment in developing a Web site or in other Internet marketing this year.

The small business owners remain relatively optimistic about the economy. When the survey was conducted in the spring, more than 60 percent of the respondents were optimistic about the economy through this year. And respondents were even more optimistic about their own companies then they were about the general economy. Some 81 percent said they were optimistic about their own company this year, while just 9 percent said they were pessimistic. Those in the transportation and real estate sectors were the most optimistic, while those in the retail sector were more pessimistic, according to the survey.