I get this all the time. I apologize to the translators.
Interestingly, about one in five is not using the Internet for business purposes, a proportion that has actually not changed since 2005. Overall, small businesses use the Internet in three general ways. They use it for information, including networking and training; they use it to market their business, and this could be through their own website or other sites or by purchasing online advertising; and third, they use it to sell their products and services.
Not surprisingly, the most common use is for information that's important to their business. What's interesting about this is that in fact in 2004, when we first asked this question, only 8% were using the Internet for information that was important to their business. By 2008 this had grown to more than 60%, as you can see on slide 6. Among new businesses that are less than one year old, the Internet is the most important place to get information that's important to their business.
In addition to using it for information, more and more are using the Internet to market their business. As you see on slide 7, among small business owners it was the most likely form of marketing of their business, after referrals and word of mouth. At this point there were 42% who said they had a website, and that was in 2008. It was up to 52% by 2009, as you saw on slide 5. And now, as we know, there was a study released just last week by BDC and CEFRIO, out of Quebec, showing that 70% of SMEs now have websites.
Finally, some small businesses are selling their goods or services online. But as you can see on slide 8, only 16% were selling through the Internet. While this was asked back in 2008, the same BDC-CEFRIO survey from last week did not indicate much growth since then, as only 18% in that survey were engaging in online sales.
So why are small business owners embracing the Internet but being slow to sell their products online? Much of it has to do with cost. As part of the payments review that is currently taking place at the federal level, we released a report just last week. In that study we found that for small firms there are many obstacles to accepting electronic payments, the most important of which is that the cost of implementing the system does not justify the investment, as you can see in that chart on slide 9.
Part of this stems from the fact that to sell online you have to think differently about how you run your business. As I mentioned earlier, you have to manage your inventory differently. How do you accept your payments? How do you interact with your clients? Ultimately it's the cost of renting or leasing electronic payment equipment, as well as the charges associated with processing those electronic payments, that really discourages many from moving in this direction.
Another factor for many, though, is the concern with online security. They feel there is a potential risk of losing customer or business data, or having sensitive personal or financial information stolen for which they themselves may become liable. This is especially worrisome for smaller firms that cannot always afford to protect their systems with more sophisticated software.
In conclusion, there is a strong desire on the part of most SMEs to increase their online presence in order to reach more customers and grow their operations. Policy decisions, for example, on broadband Internet and even wireless communications will have a direct impact on the ability of small businesses, especially those in rural areas, to do so.
We encourage the government to continue to monitor and make adjustments when necessary when potentially harmful decisions that have broad economic impact are made, to ensure that SMEs continue to have access to a wide variety of competitive Internet and wireless services.
Next, e-commerce depends on electronic payments, and there is a lot of growth and change happening in this area. To ensure these remain attractive to small firms, they must be affordable, accessible, secure, and user-friendly. The service providers also managing those electronic payment systems must be held accountable, perhaps by having to adhere to a code of conduct that could be further broadened.
Finally, I haven't touched on it in the presentation so far, but it is very important that governments minimize legislation and red tape that may hinder the adoption of e-commerce by smaller firms. I'd be happy to provide some examples in the question and answer period.
Thank you for your time today and for undertaking this comprehensive study. I hope I've been able to provide you with at least a small glimpse into this very large subject matter.