E-Business and Distribution Channel Strategies in Agribusiness Industries

The explosion of e-business activity presents many challenges to manufacturers, distributors, and dealers as they select a distribution channel for the delivery of products, services, and information. The expected growth in Internet sales by agribusiness firms is analyzed to provide insight into the selection of an e-business distribution channel. Agribusiness firm managers were surveyed regarding the application and perceived impacts of e-business activity on their firm's operations. Firm characteristics and manager perceptions regarding the impact of e-business activity were analyzed descriptively and in regression analysis to understand the drivers of expected Internet sales growth. Expected Internet sales growth was found to vary by the firm's position in the distribution channel. Yet, firms with greater levels of existing e-communication with either customers or suppliers and with managers perceiving greater ability of e-business activity to improve inventory management and logistics issues have higher levels of expected Internet sales.