Determinants of B2B E-Marketplace Adoption: An Empirical Study of Indian Small Firms

Development of Micro, Small and Medium Enterprise (MSME) sector in India has been a priority issue. They constitute 95 percent of total industrial units, provide huge employment opportunities and contribute significantly to GDP. Prior research indicates that B2B e-marketplace offers ample opportunities for MSMEs to access global markets and enhances their competitiveness. There is limited empirical research on B2B e-marketplace use by Indian MSMEs, as also on the factors that influence their adoption. As adoption of B2B e-marketplace is in its growth stage in India, there is a need to understand the factors that influence the adoption. Based on the theoretical frameworks of Diffusion of Innovation, Institutional theory and Transaction cost theory, a conceptual framework that identifies organization, environment, product and e-marketplace related factors influencing adoption is developed. Using the data from 122 MSMEs, the significant factors that influence adoption of B2B e-marketplace are identified. The practical implications for the B2B e-marketplace service providers are also discussed.