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2003 ERC Special Report Outline Small Medium Enterprise Introduction For the past several years, Evans Research Corporation (ERC) has investigated information technology (IT) procurement patterns in Small and Medium Business (SMB) in Canada. Through this research, ERC has revealed there are constant changes in requirements, practices and preferences of SMBs. Since the study’s inception in 1997, ERC has discovered that new product offerings, changing patterns in the distribution channel, and the advent of the Internet have all contributed to a level of complexity that warrants constant attention by IT vendors. There are 200,000 SMBs in Canada with 10 to 350 employees, representing a significant market for IT vendors and their partners. As such, vendors face the challenge of designing channel and marketing programs that are effective in selling computer products and services to this target market. Therefore, identification of the differences and similarities in purchasing behavior across industry sectors has figured prominently in the design of this study, methodology and analysis. As the sub-segments of the SMB community have extremely different needs, this study will identify the different purchasing patterns of varying industry sectors and will also identify the purchasing patterns and behaviors common to all businesses in the differing sectors. ERC believes this information will be invaluable to all companies striving to increase sales to SMBs by providing them with information that is crucial to targeting this market effectively. Research Scope This year, ERC will revisit why and how SMBs in Canada buy computer products and services, focusing on purchasing processes of these organizations, the products and services purchased and future buying intentions. Timeframe Purchasing behavior will be examined in these timeframes: Equipment and services installed/in use Intended purchases and brand preferences (next 12 months) Products/Services Purchasing patterns will be examined for the following products and services: Personal Computers servers, notebooks, desktops, handhelds  Networking Hardware/Software LAN, interface cards, LAN O/S software, hubs, internetworking Internet/Intranet Internet Access Services, Web Authoring/Development Software, Browsers, Web site, Hosts/Servers Software Accounting, HR, e-mail, Services PC Installation, configuration, maintenance, networking installation, software/application development Sources From what sources are the above products and services acquired: Direct (1-800, Internet) Small SIs / VARs National SIs / VARs Mass Merchandisers Dealers/Retailer Consultants Software Companies Other Selection Criteria For Vendors/Brands: Price Quality Service/Support Other For Sources: Price Service & Support Vertical Market / Industry Knowledge Vendor Certification Availability Other Other Elements of Purchase Process: Purchasing vs. Leasing Packaged vs. Discrete Solutions Loyalty - To Brands, To Sources Who is Involved in the Purchase Process (Owner, Financial Management, Designated Computer/Technology Resource Person/People, Other) Roles of Those Involved in Purchasing Recommendation Selection Final Purchase Authority The scope of this study will also provide an organizational analysis i.e. how purchasing patterns differ in companies defined by employee size, including: 10-49, 50-99, 100-249 and 250-350. Methodology A sample size of 625 respondents will be chosen from companies with 10 to 350 employees. The survey will be conducted using telephone interviews, with bilingual capability in Quebec. A questionnaire that can be administrated over the telephone in 10-15 minutes will be developed with client consultation. Research Timeframe The study will commence in June 2003. Data collection and analysis will be executed through July and August, with the final report delivery in September 2003. If you would like to purchase or would like more information on this report please contact Meaghan McLarnon at 416-621-8814 ext 263.