Promoting SMEs Through E-Commerce

GHANA INSTITUTE OF MANAGEMENT AND PUBLIC ADMINISTRATION
PROMOTING SMALL AND MEDIUM SIZED ENTERPRISES THROUGH E-COMMERCE A CASE STUDY OF GHANA
By STEPHEN DANSO ADUAMA
A RESEARCH PROJECT SUBMITTED TO GIMPA BUSINESS SCHOOL IN PARTIAL FULFILMENT OF THE REQUIREMENTS FOR THE AWARD OF EXECUTIVE MASTERS IN BUSINESS ADMINISTRATION
JANUARY, 2010
Declaration
I, Stephen Danso Aduama, the author of this study, hereby declare that except for the references to other peoples work, which I have duly acknowledged, the work presented here was carried out by me, an Executive Masters Degree in Business Administration, at the Ghana Institute of Management and Public Administration, under the supervision of Prof. Paul N. Buatsi.
I also declare that this work has never been submitted partially or wholly to any institution for award of a certificate.
.. (STEPHEN DANSO ADUAMA) (Participant) .. (PROFESSOR PAUL N. BUATSI) (Supervisor)
.. Date
.. Date
.. Checked for Possible Plagiarized Material ( (Librarian)
.. Date )
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Acknowledgment I would first of all express my gratitude to my supervisor, Prof. Paul N. Buatsi for his guidance during this work. Special thanks also go to all who volunteered their time to complete the questionnaire used this study. Finally I like to thank my wife, Ruth Afriyie Danso and daughters, Daniela and Mariette Danso for their understanding and words of encouragement that enabled the completion of this work.
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Dedication This work is dedicated to my family for the wonderful support.
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Abstract Though small and medium enterprises play important role in Ghana and have the potential to enhance their businesses through sale of their products online through e-commerce, little activity is seen in this area of commerce. The main focus of this work is to look at external barriers to the adoption of e-commerce in Ghana and what needs to be done to start B2C commerce within the SME sector under the present business environment.
Table of Contents Chapter 1: Introduction .......................................................................................................1 1.1. Background to the Study .......................................................................................1 1.2. Statement of the Problem ......................................................................................2 1.3. Objectives of the Study .........................................................................................3 1.4. Significance of the Study ......................................................................................3 1.5. Methodology.........................................................................................................4 1.6. Structure of the Study ...........................................................................................4 Chapter 2: Literature Review ..............................................................................................5 2.1. Introduction ..........................................................................................................5 2.2. Ghana SME Sector................................................................................................5 2.3. Definition of e-commerce .....................................................................................6 2.4. Benefits of Ecommerce to SMEs...........................................................................7 2.5. Barriers to e-commerce Adoption by SMEs in Developing Countries ...................9 2.6. Barriers to e-commerce Adoption by SMEs in Ghana ...........................................9 2.6.1. Accessibility....................................................................................................10 2.6.2. Cost.................................................................................................................12 2.6.3. Suitable payment systems ................................................................................12 2.6.4. Legal framework .............................................................................................13 2.6.5. Trust................................................................................................................14 2.6.6. Logistics for Delivery of Indirect e-commerce products ..................................15 Chapter 3: Conceptual Framework ....................................................................................16 3.1. Introduction ........................................................................................................16 3.2. Brokerage Model ................................................................................................16 3.3. Advertising Model ..............................................................................................17 3.4. Infomediary Model .............................................................................................18 3.5. Merchant Model .................................................................................................18 3.6. Manufacturer model ............................................................................................19 3.7. Affiliate model....................................................................................................19 3.8. Subscription model .............................................................................................20 3.9. Community Model ..............................................................................................20 3.10. Utility model ...................................................................................................20 3.11. Applicable Model ............................................................................................21 Chapter 4: Methodology ...................................................................................................22 4.1. Introduction ........................................................................................................22 4.2. The Study Objectives ..........................................................................................22 4.3. Design method and techniques to gather data ......................................................22 4.3.1. Study tool ........................................................................................................22 4.3.2. Sampling .........................................................................................................23 4.3.3. Survey Design .................................................................................................24 4.4. Research Results .................................................................................................24 4.4.1. Demographic of Respondents ..........................................................................25 4.4.2. Reasons of Using the Internet ..........................................................................26 4.4.3. Factors that Would Influence Purchasing Online .............................................28 4.4.4. Type of products that are likely to be purchased online in Ghana:....................31 4.4.5. Pricing Comparison: ........................................................................................31 4.4.6. Issue of inability to examine physically before purchase:.................................32 4.5. Data Analysis......................................................................................................33 4.5.1. The Mann-Whitney-Wilcoxon (MWW) Test ...................................................33 4.5.2. The Kruskal-Wallis (K-W) Test ......................................................................34
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Chapter 5: Analysis and Findings......................................................................................36 5.1. Introduction ........................................................................................................36 5.2. Perceived Risk of Purchasing according to Gender Classification .......................36 5.3. Perceived Risk of Purchasing according to Internet Usage Classification ............39 5.4. Perceived Risk of Purchasing according to Age ..................................................42 5.5. Perceived Risk of Purchasing according to Previous Ecommerce Purchase Experience ....................................................................................................................45 Chapter 6: Conclusions/Recommendations .......................................................................47 6.1. Conclusions regarding study objectives ...............................................................47 6.2. Limitations of the Study......................................................................................49 Appendix 1 ...........................................................................................................................50 List of References .................................................................................................................52
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List of Abbreviations B2B B2C C2C CD CIC ECA EDGE GDP GEDC GNA GPRS GSM GSS ICT MoC NBSSI SME SMS UNCTAD 3G MWW K-W Business to Business Business to Consumer Consumer to Consumer Compact Disc Community Information Centre Economic Commission on Africa Enhanced Data rates for GSM Evolution Gross Domestic Product Ghana Enterprise Development Commission Ghana News Agency General Packet Radio Service Global System for Mobile Communications Ghana Statistical Service Information Communication and Technology Ministry of Communication National Board for Small Scale Industry Small and Medium Enterprise Short Message Services United Nations Conference on Trade and Development Third Generation Mann-Whitney-Wilcoxon Kruskal Wallis
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Chapter 1: Introduction
1.1.
Background to the Study
Many writers mention the enormous benefit of electronic commerce or e-commerce. For example, Kofi A. Annan explains that the emergence of electronic commerce over the past decade has radically transformed the economic landscape and for developing countries, the digital revolution offers unprecedented opportunities for economic growth and development. On the other hand, countries that lags behind in technological innovations risk being bypassed by the competitive edge of those using the new technologies. (UNCTAD, 2001, p.4) Shemi and Beatrice (2003) also reports Miers as saying that e-commerce has been hailed as the most fundamental change since paper money was invented (p.1).
eMarketer predicts that retail e-commerce would reach USD 711billion by 2010, a rise of 112% from a 2006 figure of USD 335 billion (eMarketer, 2008). iResearch also indicates that global B2C ecommerce alone reached up to USD 410 billion in 2005 and it is predicted to hit USD 1.5 trillion by 2010 (iResearch, 2006). This speedy and continuous growth of ecommerce is being fuelled by the internet. It is estimated that more than 85 percent of the worlds online population has used the internet to make a purchaseincreasing the market for online shopping by 40 percent in the past two years (Nielson, 2008).
This growth in e-commerce is bringing enormous benefits to organizations including small and medium size enterprises (SMEs) by providing them with the ability to access even international markets that used to be difficult to enter due to high transaction costs and other market access barriers (UNCTAD, 2002, p.4). Many studies have been conducted into factors affecting adoption of e-commerce. According to Van Toorn et. al. (2006), researchers classify barriers to e-commerce adoption as internal
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and external to the business. Internal barrier are impediments within the SMEs and includes issues such as security, lack of technical knowledge and owners characteristics whiles that of external barriers deals with impediments not within the control of SME such as infrastructure, political, legal, social, and cultural (Kapurubandara and Robyn Lawson, 2006).
1.2.
Statement of the Problem
Unfortunately, like most African countries, not much is seen in terms of SMEs in Ghana using e-commerce to enhance their revenues. Over 95 per cent of e-commerce takes place in developed countries, with Africa and Latin America combined accounting for less than 1 percent of the total (UNCTAD, 2003). SMEs the world over however, play an important part in economies they are situated. In Ghana, the total economic output of SMEs is some 50 per cent of gross domestic product (GDP), and this sector employs in excess of 60 per cent of the total labour force (ISSER, 2006). About 91% of the organizations in Ghana, the majority being SMEs are not involved in e-commerce (INIIT, 2002), indicating a relatively slow e-commerce adoption. The slow pace of e-commerce adoption in the SME sector has resulted in a number of studies at various levels in Ghana.
Most of these studies have looked at internal barriers in adopting e-commerce in Ghana. One such study showed that SME owners/managers in a transitional economy consider strategic value when it comes to e-commerce adoption (Hinson et al., 2008). Other studies in Ghana have suggested Business to Consumer (B2C) commerce as the most likely form of ecommerce to develop in Ghana (ECA, 2006). The study however did not provide details of why consumers would be interested in B2C commerce in Ghana. A study in Nigeria, another West African country with similar background like Ghana indicates the following four factors as affecting the adoption of e-commerce; cost, accessibility, data security and citizens
income (Folorunso et al., 2006). The present study focuses on the external barriers to B2C ecommerce partly because B2C commerce is likely to be the form of e-commerce to develop in Ghana and also that rapid return on investment is more likely to be achieved by B2C which greatly enhances the business by bringing many significant advantages (Caglar et al., 2003, p.2). The study would seek to find out factors that are likely to restrict people from using ecommerce in Ghana.
1.3.
Objectives of the Study
The main objective of this study is to consider external barriers which need to be addressed for successful e-commerce implementation in Ghana. The study addressed the following objectives: 1. To assess the level of B2C e-commerce usage in Ghana. 2. Identify external barriers to e-commerce adoption in Ghana 3. Determine existing B2C commerce models that can be utilised for e-Commerce activity in SMEs in Ghana. 4. Determine the type of products that are likely to be purchased online in Ghana.
1.4.
Significance of the Study
This study is significant for several reasons. Firstly, it fills a knowledge gap about existing ecommerce B2C model applicability to Ghana, and seeks to identify which factors are important for encouraging consumers to accept B2C e-commerce. Secondly, this study focuses on a relatively unexplored yet very potential sector in Ghana the SMEs. The internet is being used primarily by SMEs in Ghana as a communication and information tool. Since SMEs web pages are essentially static media, the advantages of the e-commerce remain an untapped source. They are unable to enjoy potential benefits in promoting their business. This
work seeks to find how SMEs can begin to trade online. It is hoped that this would provide the necessary experience which can spur SMEs into more complex e-business activities such as B2B commerce. The research findings from Ghana may prove to be useful for other developing countries of a similar nature.
1.5.
Methodology
This is an exploratory study that uses an accidental sample chosen from Tamale, the capital city of the Northern Region of Ghana. The study is limited to Tamale due to logistical constraints in organizing a nationwide survey. Additionally, available literature indicates that higher benefits can be generated in markets such as Tamale, where customers are far away from companies offering the product/service. As a method of gathering the requisite data, a fully structured questionnaire is utilized. In all, a total of 100 questionnaires were sent out. The 61 good responses were analysed using descriptive statistics.
1.6.
Structure of the Study
The studys body is structured into five chapters. Chapter 1, the introduction provides the background of the study, problem statement, objectives, significance, and organisation of the study. Chapter 2 is devoted to a review of the relevant literature to provide the essential notional perspectives of SMEs and e-commerce. Chapter 3 outlines the methodology used in gathering the data and methods adopted in its analysis. Chapter 4 presents data analysis, presentation of observations and discussions on the findings of the study. Chapter 5 summarises the main findings from the study, draws conclusion and provides recommendations.
Chapter 2: Literature Review 2.1. Introduction
The aim of this chapter is to present a review of the existing literature on SMEs and ecommerce. Several different writers have written on the subject of small business with each touching on different views. This chapter looks at the views as they relate to the topic. Before discussing on how well SMEs can make use of e-commerce to promote their activities, it is important to understand the following: SME and e-commerce adoption.
2.2.
Ghana SME Sector
According to Storey (1994), there is no unique, single, uniformly acceptable, definition of a small firm. This is confirmed by the various definitions of SMEs that have been put forth by a number of sources such as the Bolton Committee Report (1971), Binks and Coyne (1983); Curran and Stanworth (1984) and the European Commission (EC, 2003).
A number of institutions such as the National Board for Small Scale Industries (NBSSI), the Ghana Enterprise Development Commission (GEDC), Ghana Statistical Survey (GSS) and academics have attempted defining the SME sector in Ghana. Definitions from these agencies are not without differences though. GSS considers firms with less than 10 employees as Small Scale Enterprises and their counterparts with more than 10 employees as Medium and LargeSized Enterprises. Whiles the GEDC on the other hand uses a 10 million Cedis (1,000 Ghana Cedis) upper limit definition for plant and machinery (Kayanula and Quartey, 2000). These two definitions use as sole criteria either the number of employees or plant and machinery. The NBSSI definition combines both fixed asset and the number of employees. The NBSSI defines SMEs in Ghana as follows:
Table 1: SME Definition by NBSSI Number of employees Small-scale Medium Scale Large Scale Source: NBSSI For the purposes of this work, the definition of SMEs by NBSSI would be adopted since it appears to be the one generally used (Mensah, 2005) and also applies to the businesses being studied. Up to 29 workers 30-99 workers >100 workers Fixed asset >US$10,000 Up to US$100,000 up to $1 million
Mensah (2004) summarises the typical profile of Ghanaian SMEs as follows: They are dominated by one person, with the owner/manager taking all major decisions. The entrepreneur possesses limited formal education, access to and use of new technologies, market information, credit from the banking sector is severely limited, Management skills are weak, thus inhibiting the development of a strategic plan for sustainable growth, Experiences extreme working capital volatility, Lack of technical know-how and inability to acquire skills and modern technology impede growth opportunities (2004, p.1).
2.3.
Definition of e-commerce
The range of definitions found in literature suggests that there is no universally accepted definition of e-commerce. Electronic commerce can be defined as the process of buying and selling goods and services electronically, involving transactions using the internet, networks, and other digital technologies (Laudon and Laudon, 2006). E-commerce also refers to
advertisement, sale and payment of products and services through an electronic network, to be delivered physically or virtually, from the seller to the buyer (UPU, 2007).
From the foregoing definitions, e-commerce takes place when the product or service is advertised and sold electronically. The delivery of goods can either be done online or off-line. Direct e-commerce applies to the delivery of intangible goods such as music in MP3-form, information and software online. Indirect e-commerce refers to electronic trade in tangible goods, such as, for example, music in CD form (Dialogic, 1999, Weijers et al., 2001). In indirect e-commerce products ordered online are delivered offline for example by post or courier.
2.4.
Benefits of Ecommerce to SMEs
Poon & Swatman (1999) and Chappell & Feindt (1999) recognise that ecommerce can provide several potential and actual benefits to small and micro firms. The driving force for the significant growth being experienced is the internet. A study by Poon and Jevons (1997) suggested that internet create an unprecedented opportunity for small businesses to engage in national and international marketing campaigns that previously would have been unaffordable. The findings by the above authors indicated that the usage of email has resulted in efficiency gains and the ability to perform new tasks, such as sharing documents and working remotely (1997). There are significant opportunities for SMEs in developing
countries to utilize ICT (Duncombe and Heeks, 2001).
The benefits of e-commerce to SMEs have been well reported by Jones et al. (2004) as follows:
Cost savings, including lower logistic costs, lower postal cost, lower storage costs and lower personnel costs (Venkatraman, 1994; Poon & Swatman, 1997; Kalakota, 2000; Chappell & Feindt, 1999). Time savings, including quicker response time to markets, customers, suppliers, higher flexibility and a reduction in the delivery time and processing of payments (Fink, 1998; Chappell & Feindt, 1999; Lancioni, Smith & Oliva, 2000). Connection improvements such as disintermediation. This is the process by which mediating organisations are removed in the customer chain (Currie, 1998; Kalakota, 2000). Quality improvements, such as access to new markets, new ways of marketing new products and services, improved communication plus the general improvement in customer relations (Currie, 2000; Chappell & Feindt, 1999). Strategic improvements such as more efficient and effective organisational forms and doing business on the global scale (Poon & Swatman, 1997). Access to new markets, ecommerce provides the opportunity for business to offer products and services in new potentially global markets (Greaves, Kipling & Wilson, 1999). Traditional distribution channels (distributors and retailers) tend to add significantly to the cost of products, the margin can be as high as 135 percent of its original cost to manufacture (Laudon and Laudon, 2006). Considering enormous benefits to be realized, SMEs should become more interested in B2C commerce as it can help to lower their cost through disintermediation and become competitive.
Failure by SMEs to adopt e-commerce may limit their ability to trade in global markets. For example, the E-commerce and Development Report 2001 states that enterprises in developing countries that are or plan to be involved in international trade need to start
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incorporating ICT and the Internet into their business models in order to stay competitive (UNCTAD, 2001). E-commerce emerges in industry in three forms: inter-enterprise
[business-to-business (B2B)], between enterprises and consumers [business-to-consumer (B2C)] and inter-consumer [consumer-to-consumer (C2C)] (Rayport and Jaworski, 2003).
2.5.
Barriers to e-commerce Adoption by SMEs in Developing Countries
Available literature identifies a number of factors inhibiting the adoption of e-commerce by SMEs in developing countries. Lack of infrastructure is listed as a major constraint to adoption by SMEs (Jennex et al., 2004, Stylianou et al., 2003). In addition to the issue of infrastructure, another study further revealed that the most repeatedly mentioned issues were lack of online payment systems such as credit cards, poor distribution logistics, lack of specialized, trust-worthy online merchants, imperfect legal system, and lack of large scale telecommunication transmission capability (broadband). (Efendioglu et al., 2005) Two studies conducted in Argentina and Egypt, (both developing countries) suggests that the key factors of electronic commerce adoption in developing countries are: awareness, telecommunication infrastructure, and cost (Schmidt et al., 2001). Another study identified four variables namely cost, accessibility, security and citizens income to be factors affecting the adoption of e-commerce in Nigeria (Folorunso et al., 2006).
2.6.
Barriers to e-commerce Adoption by SMEs in Ghana
The problems confronting the adoption of e-commerce in Ghana may not be much different from what pertains in other developing countries. From the available literature, the external factors that may affect adoption of e-commerce are: accessibility, cost, suitable online payment systems, trust and logistics for delivery of indirect e-commerce products.
The identified external factors may not all be barriers to e-commerce adoption in Ghana. It is vital that the identified challenges to adoption of e-commerce by SMEs be assessed to see their level of relevance under the prevailing business environment.
2.6.1. Accessibility On the issue of network infrastructure, Ghana has seen some significant progress now when compared to other African countries. Table 2 gives some comparison of internet growth within selected African countries. With the exception of Sudan, with a much higher population, Ghanas growth rate was significant when comparable to the other countries although far below the average of 5.3% recorded in Africa. Table 2: Internet Users and Statistics of Selected African Countries as at June 2008 Internet Country Users Dec/2000 Angola Ghana Madagascar Mozambique Senegal Sudan 30,000 30,000 30,000 30,000 40,000 30,000 Internet Users Latest Data 100,000 650,000 110,000 200,000 820,000 1,500,000 Use Growth (2000-2008) 233.3% 2,066.7% 266.7% 566.7 % 1,950.0% 4,900.0 % Population (2008 Est.) 12,531,357 23,382,848 20,042,551 21,284,701 12,853,259 40,218,455 Penetration (% Population) 0.8 % 2.8% 0.5 % 0.9 % 6.4 % 3.7 %
Source: http://www.internetworldstats.com/
The widespread availability of Global System for Mobile communications (GSM) networks in Ghana is providing the means of accessing the internet even in very remote areas. There are significant internet speeds available on the GSM networks. For example, a GSM network offering General Packet Radio Service (GPRS) services can provide speeds of about 114kbps and an Enhanced Data rates for GSM Evolution (EDGE) can even do up to 384kbps.
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Download speeds obtained on a third generation (3G) network can typically range from 600 Kbps to 1.4 Mbps. The future of internet access looks even more promising. There are indications that there would be significant growths in internet users as mobile networks are considering expanding their current limited EDGE services to cover many more locations. Others are even either planning or considering the launching of third generation (3G) services in Ghana. The CEO of Zain Ghana has indicated that Zain is considering rolling out EDGE and/or 3G services (www.telegeography.com; 2008). Vodafone, the new 70% majority owners of Ghana Telecom have also indicated a similar commitment that coverage and quality of the mobile network would also be expanded across the country, including widening the EDGE network across major urban areas in the short term and bringing 3G to Ghana within 2009 (Vodafone Fact sheet, 2008; GNA). Additionally, Vodafone is also offering its Broadband in all regional capitals and some districts.
The Government of Ghana has put in place a national plan to provide fibre connectivity throughout Ghana. Currently, Vodafone has committed to the completion of the national fibre optic backbone network that would make available high-speed broadband to the people of Ghana and support governmental effort to develop ICT in schools (Vodafone Fact sheet, 2008; GNA). In the interim, the nationwide GPRS and EDGE services being offered by the mobile operators can be utilised to enable significant e-commerce activities in anticipation of the grand network rollouts by the telecom operators. Additionally, the government of Ghana is setting up Community Information Centres (CICs) in all 230 constituencies, the first of which was commissioned in June 2008 by Dr. Benjamin Aggrey Ntim then Ghanas Minister of Communications. Accessibility is not considered a major issue in e-commerce adoption.
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2.6.2. Cost
The main cost constraint foreseen is that of cost of acquiring personal computers and the internet connection. It is envisaged that the keen competition within the mobile network operators would drive down prices of internet connection drastically. Over the years, starter pack prices for GSM have dropped from as high as GH Cedis 50 to GH Cedis 1. It is clear that a similar trend is likely to be seen in data services. For example in the third quarter of 2008, then Ghana Telecom dropped its internet installation charges of its broadband by about 50% in a special promotion. As more network branded phones with internet capabilities are introduced by the mobile companies at relatively cheaper than market prices, more people are likely to get access to the internet using these devices. Additionally, the wide presence of internet cafes is also making it possible for individual consumers to get access to the internet without making enormous initial upfront investment into computers and internet connection.
2.6.3.
Suitable payment systems
In order to take advantage of the potential of conducting commercial transactions electronically, it is necessary that e-commerce participants also be able to complete a crucial aspect of the transaction process the payment electronically (ECA, 2006). The ECA report further claimed that this poses a challenge for the popularization of e-commerce and for consumer-focused (B2C) e-commerce in particular. The introduction of the e-zwich which is a common electronic platform that links the payment systems of all banks, savings and loans companies and rural banks in Ghana will contribute significantly at resolving this challenge.
This biometric smart card enables loading and spending of e-cash and also allows the settlement of inter-bank claims in addition to online transactions. Customers are able to effect transactions offline in underdeveloped areas where power and communication infrastructure
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maybe lacking. The e-zwich card can be used to resolve the online payment challenges and effectively to promote B2C e-commerce activities in Ghana.
Additionally, mobile companies are also developing online payment system. One such solution is the M-PESA developed by Vodafone that enables customers to complete simple financial transactions by mobile phone. All they need to do is register at an authorized MPESA Agent by providing their Vodafone mobile number and their identification card. Once registered, customers can deposit money into their account and transfer money to other mobile phone users by short messaging services (SMS) instruction, even if they are not Vodafone subscribers.
Following the success of the M-PESA in Kenya, there are indications that Vodafone would be rolling out this service in most of their emerging market operations including Ghana as captured in the following statement by Gavin Darby, CEO Non European Affiliates at Vodafone: Now we have officially launched M-PESA in Kenya, we look forward to taking the service international. Our announcement yesterday of Vodafones international money remittance venture with Citigroup to assist migrant workers send money home conveniently and safely using mobile technology, would not be possible without the Kenya trials which have led to the successful launch of M-PESA. 2.6.4. Legal framework
Ghana is in the process of enacting laws that would govern electronic transactions. A memorandum to the electronic transactions bill drafted in 2005 gives the following as its objectives: (a) To facilitate modern business and commerce in Ghana; (b) To facilitate electronic transactions on a technology neutral basis by means of reliable electronic records;
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(c) to remove uncertainties in relation to conducting transactions electronically with respect to the requirements for documents and for signatures to be in writing; (d) To promote public confidence in the validity, integrity and reliability of conducting transactions electronically; and (e) To promote the development of the legal and business infrastructure necessary to implement electronic transactions securely (MoC, 2005).
The delay in passing this bill into law may be attributable to the complexity of enacting such laws. Experience suggests that a discrete, evolutionary approach to implementing the whole basket of cyber-laws a country requires would have the advantage of dealing with real issues rather than imagined controversies (ECA, 2006). It is advisable to initially narrow the scope of legislative efforts to clearly defined areas.
Even without such laws it should be feasible to start B2C e-commerce. Typically, when a person walks into a store all he does is to examine the items and if satisfied, pays for the item. Probably, a warranty may be given but this is not the issue in most cases. If a model can be found that will mimic this scenario, then B2C e-commerce can be undertaken even with existing laws.
2.6.5. Trust
Although trust was not mentioned by the ECA report, this is also identified as a major component in e-commerce especially B2C. Grabner-Kraeuter states that trust is the most significant long-term barrier for realizing the potential of e-commerce to consumers (Grabner-Kraeuter, 2002). The point is supported by others who state that trust will be a key differentiator that will determine the success or failure of many Web companies. (Urban et.
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al., 2000) Other researchers have noted that trust may be significantly influenced by culture of a given society (Efendioglu et al., 2005).
In an era in Ghana where fraud is being perpetrated on the internet in various forms as 419, sakawa etc., trust will be crucial for both parties in the transaction. The consumer needs assurance that any monies being paid is not going to any of these scammers. Additionally, that goods bought and delivered would be according to the agreed standards and specifications. Businesses also need assurance that they would be rewarded accordingly for services rendered.
2.6.6. Logistics for Delivery of Indirect e-commerce products
To build the confidence of consumers that e-commerce is an alternative way of shopping requires better delivery systems for indirect goods. Although not up to the highest standards in developed economies, there are a number of organizations which can fill this need. Ghana Post currently has 330 main post offices and 700 agencies countrywide (GNA, 2006). Ghana Post with some little arrangement would be able to deliver such goods to their nearest offices for collection. Alternatively, all the major transport companies such as Intercity STC, Metro Mass transit are now involved in parcel delivery and can handle this.
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Chapter 3: Conceptual Framework
3.1.
Introduction
From literature review, five out of the six identified challenges to adoption of e-commerce namely: accessibility, cost, suitable online payment systems, and logistics for delivery of indirect e-commerce products do not seem to present any serious challenges to B2C commerce in Ghana. The issue of trust is however worthwhile investigating. For example, how safe would consumers feel in making payments to an unknown enterprise, perhaps a newly established SME only known to them online with the promise that such items would be delivered later. To enable the promotion of e-commerce activities by such SMEs requires the resolution of this external barrier. It is believed that this remaining challenge can be solved through the use of the appropriate business models. The focus of this work is to identify model (s) applicable in Ghana that can promote B2C commerce within the SME sector considering issues of their low capital base and lack of technical know-how. There are nine major categories that are used to classify a number of different types of business models that have been identified in practice among Web-based enterprises (Rappa, 2004).
3.2.
Brokerage Model
The brokerage model involves the use of brokers who bring buyers and sellers together to engage in transactions. Brokers do not sell their own products, but rather bring buyers and sellers together. Typically, the broker charges a fee to at least one of the parties involved in the transaction. The brokerage model mostly feature in business-to business (B2B), businessto-consumer (B2C), or consumer-to-consumer (C2C) markets. Brokerage model can take on many forms such as transaction and auction.
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The transaction broker provides a third-party payment mechanism that enables buyers and sellers to settle a transaction. An example of this is Paypal which is a secured online payment service that allows individuals and businesses to transfer funds electronically to pay for goods and services purchased online. An Auction Broker performs auctions for sellers and charges the seller a listing fee and commission based on the value of the transaction. An example is eBay which has created a powerful platform for the sale of goods and services for individuals and businesses.
The broker is responsible for setting up the infrastructure required for the exchange. The ability to recover his cost will depend on the cost of the infrastructure and the number of customers buying through the broker. This model will be suitable for B2C commerce in Ghana especially when the broker is a reputable and trustworthy and resolves issues of lack of technical know-how, low capital and trust on the part of SMEs.
3.3.
Advertising Model
In this model, a website offers free content and services such as e-mail, chat, forums and also provide a forum for advertisements in the form of banner ads. The advertising model relies on advertising to make money and receives fees from advertisers. An example is the web portal Yahoo which offers things like free e-mail, extensive content, and travel services to attract large traffic volumes.
This model would be suitable for well establish organizations who have already set up their own website offering e-commerce activities. They can then utilize such popular advertising sites to drive traffic to their sites. It would not be suitable for the promotion of companies who
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are not already trading online. Ghanaian SMEs wanting to utilize this model need to still set up their own e-commerce sites. Issue of set up cost may be a limiting factor. This would therefore not be suitable to SMEs in Ghana since the majority already are not offering ecommerce. This model is also characterised by low uptake typically 0.1 -0.5% (Goonan et al., 2007).
3.4.
Infomediary Model
An infomediary may trade goods and services in return for detailed information about surfing and purchasing habits. The information collected is then sold to other businesses to be used in target marketing campaigns. The weaknesses of this model include the amount of information required, size of customer base and trust (Goonan et al., 2007). The basic aim of this model is to provide information to companies for the planning of activities such as target marketing. It would not be suitable as a B2C e-commerce model. Moreover, the success of this model would depend on the availability of a large customer base that will be willing to provide significant amount of personal information to make significant deductions that would be interesting to business. Additionally, it would be difficult to trust that the information provided is accurate as people are capable of submitting multiple entries just to get more of the free item. In view of the foregoing, this would not be considered as a viable B2C ecommerce model.
3.5.
Merchant Model
The merchant model involves the establishment of an electronic storefront to offer wholesale and retail goods and services. Sales may be made based on list prices or through auctioning. A typical example is Amazon.com which sells various items and payments are made by various credit cards. Literature suggests that the merchant model is the most often associated with
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B2C commerce (Laube and Zammuto, 2003). Since revenue is obtained by selling items over the internet, the key is to attract as large visitors to its website. Despite is attractiveness, there are likely to be serious potential problems in its implementation in Ghana. For example, Goonan et al. mentions online fraud (authentication), customer privacy and security of data as a weakness. Considering the present unavailability of an electronic transaction laws to cater for possible conflicts arising from its usage, this model would be inappropriate at present.
3.6.
Manufacturer Model
This is used by manufacturers to sell their products or services directly to their customers. The manufacturer model may be chosen for its efficiency, improved customer service, or due to a better understanding of customer preferences (Rappa, 2004). Dell Corporation uses this model to sell personal computers directly to its customers. This model is used by businesses who want to cut intermediaries and deal directly with their consumers. Weaknesses of this model are low margins, high maintenance of supplier relations and inapplicability to some industries (Goonan et al., 2007). Since this model is characterised by low margins, use of this model would require selling in large volumes to be attractive. The model is not suitable for promoting B2C commerce especially considering that SMEs in Ghana are not typically producing in large quantities.
3.7.
Affiliate Model
The affiliate model enables websites to re-direct visitors to their sites to other sites that provide goods and services by means of click-through links. The affiliate may be paid per
the number of times a person clicks on the referral link (pay-per-click) or paid a commission on the number referrals leading to actual sales (pay-per-lead).
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This model would be beneficial if SMEs have set up their e-commerce sites and are redirecting customers to them. This is not the situation in Ghana and as such this model would be unsuitable at present.
3.8.
Subscription Model
For this model, customers utilize services being offered and pay a periodic fee as subscription cost. The fee may be paid on daily, weekly, monthly or annually. A typical application is the sale of internet services such as Broadband by Vodafone which attracts monthly prepaid subscriptions. This model is suitable for products offered continuously such as internet. Utilization of this model would exclude products that are not utilized continuously. Model would not be suitable for B2C e-commerce products most of which would not be purchased continuously.
3.9.
Community Model
In this model, like minded users made of individuals or groups invest both their time and emotions in a developing an online presence. Revenue can be generated based on the sale of ancillary products and services or voluntary contributions (Rappa, 2004). The community model is not listed among applicable B2C e-commerce model.
3.10.
Utility Model
The utility model is based on metering usage and constitutes a pay as you go approach. Unlike subscription services, metered services are based on actual usage rates. The utility model is not listed among applicable B2C e-commerce model.
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3.11.
Applicable Model
From the foregoing discussions, the brokerage model is most suitable and as such would be utilized in this study. This model is suitable in view of the following: 1. Shared cost: A trusted organization can set up a centralized website where buyers and sellers can enter into transaction. The cost burden on individual SMEs can be reduced making it attractive for them to utilize the services. The broker can charge a fee to the enterprise on items sold. Shared cost is more likely to be appealing to SMEs considering that typically, most have limited financial resources making setting up own online websites challenging. 2. The use of a trusted broker can also guaranty some security to the B2C e-commerce participants. It would be difficult for SMEs to attract consumers to pay online in anticipation of supplies that would be at a later time due to experiences of swindlers.
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Chapter 4: Methodology
4.1.
Introduction
This work consider how trust from perspective of consumers, the main identified external barrier to e-commerce in Ghana can be resolved. The level of importance of trust would be determined. The work would also demonstrate if the brokerage model can be applied in Ghana to provide consumer confidence in dealing with SMEs with only online presence. Additionally, the research would identify possible goods to be patronized by consumers.
4.2.
The Study Objectives
Available literature suggests that that the adoption of ICTs by SMEs in developing countries is largely a market-driven process dependent on buyers (UNTAD, 2004). In determining business model(s) to be utilized in promoting e-commerce in Ghana, it is important to verify how well consumers would accept the identified model. The study therefore addresses the following specific objectives: 1. To access the level of B2C e-commerce usage in Ghana. 2. To examine the importance of trust in B2C e-commerce in Ghana. 3. To examine consumer acceptance of brokerage B2C E-commerce model in Ghana. 4. Determine the type of products that are likely to be purchased online in Ghana.
4.3.
Design method and techniques to gather data 4.3.1. Study Tool
Though other studies have been conducted in Ghana in the past that touched on various aspects of SMEs and e-commerce, there is no readily available data that would facilitate the analysis of the objectives of this work; hence primary data would be gathered. As a method of
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gathering the requisite data, a fully structured questionnaire is utilised. Few of the questions though provided opportunity for the participants to fill in additional options that are not captured in the list of possible answers. Voiculescu (2005) summarises the value of fully structured questionnaire as follows: It allows to standardized the questions to such an extent that a more numerate, statistically based analysis is possible, The hypotheses can be tested more explicitly, Provides greater feelings of anonymity, Allow respondents more time to think.
A five-point Likert scale is used in most of the questions to test the depth of importance attached to the issue of trust in making online purchases as in B2C commerce especially when the company offering the items for sale is unknown. Another question test what the situation would be if a well known reputable intermediary is used (brokerage model). The five-point scale would have the following format: 1. Strongly disagree (Not at all) 2. Disagree (low) 3. Neither agree nor disagree (undecided) 4. Agree (High) 5. Strongly Agree (Very High)
4.3.2. Sampling
To test consumer response to the brokerage model and also investigate the significance of trust in B2C e-commerce activities in Ghana, an accidental sample chosen from Tamale metropolis is utilized. The testing is limited to Tamale due to the following reasons:
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1. Conducting this survey nationwide would be logistically challenging. 2. Kvainauskait et al.(2005) suggest that efficiency of e-commerce models depends on the following market structure characteristics: number of participators in market (customers), geographical spread, and indicates that higher benefits can be generated in markets where customers are far away from company offering the service/product; hence distance becomes one of the most important factors. Tamale was selected because it is one of the cities that fit these criteria as many of businesses in Ghana are in the southern parts of the country. Additionally, it has good internet access. Ghana Telecom has a broadband network in Tamale. Other ISPs such as Africaonline also offers internet services. There are three mobile networks: Vodafone, Tigo and MTN offering internet services on their network. It is envisaged that we would get the required base to take part in the survey.
4.3.3. Survey Design The 2000 Ghana population census estimates that there are 293,881 persons in Tamale. Considering a level of accuracy of 10% either way, for the population of 293,881 required the sample size is 96. The prepared questionnaire was pre-tested to ensure that all questions would be understood before they were administered.
4.4.
Research Results
A total of 120 questionnaires were sent out by assistants to fill out. 79 responses were obtained. However, 4 of the questionnaire received back were not fully answered and were discarded giving a response rate of 63%. A profile of the respondents is presented below:
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4.4.1. Demographic of Respondents Table 3: Demographics of Respondents Respondents by Numbers 52 23 22 30 10 13 0 47 6 1 21 68 7 53 34 45 24 5 15 60 Respondents by Percentages 69.3 30.7 29.3 40 13.3 17.4 0 62.7 8 1.3 28 90.7 9.3 32.9 21.1 28.0 14.9 3.1 20 80
Gender
Age
Employment Internet Usage Reason for Internet Usage Previous Online Purchases
Male Female 18-27 yrs 28-37yrs 38-47yrs 48-57yrs Over 58 yrs Worker Unemployed Retired Student Yes No Email Product Info News Entertainment Others Yes No
From Table 3, it is noted that the majority of the respondents (91%) happened to be either workers or students. This may indicate that these groups have the requisite knowledge of ecommerce and therefore more willing to contribute in this exercise. It may also have been that the respondents were polled from workplaces and on campuses since these are high internet usage groups.
91% of the 75 respondents claimed to have used the internet before. This can mainly be as a result of the fact that most of them were either workers or students (91%) and internet access is readily available at most offices and schools. This collaborate research findings of the
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Ghana Scan-ICT Study (2002) that indicated that 81% of all organizations (public, private and non governmental organizations) have access to the internet.
The majority of the respondents stated they have not purchased any products online indicating a very low level of B2C usage in Ghana. Only 20 % of the respondents indicated having purchased online before. This can mainly be a result of the low level of e-commerce activity in Ghana.
4.4.2. Reasons of Using the Internet
Figs. 1 and 2 capture reasons for internet usage according to gender. The results indicate that both males and females used the internet mainly for e-mailing, gathering news and searching for product information.
Fig.1: Reasons For Internet Usage (Men)
3% 34%
Fig.2: Reasons For Internet Usage (Women)

13% 4% 33%
15%
25%
28%
25%
Email Product Search News Entertainment Others
20%
Email Product Search News Entertainment Others
Figures 3 to 6 shows responses classified according to the employment status of respondents: worker, unemployed, retired and students. There trend observed is similar to those of Figures 1 and 2, the only deviation being the retired.
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Fig.3: Reasons For Internet Usage (Workers)

11% 5% 35%
Fig. 4: Reasons For Internet Usage (Unemployed)

9% 27% 0% 37%
27% 22% Email Product Search News Entertainment Others

Email Product Search New s Entertainment Others
27%
Fig. 5: Reasons For Internet Usage (Retired)

0%
Fig 6: Reasons For Internet Usage (Students)

24% 0% 32%
50%
50%
Email Product Search New s Entertainment Others
28% Email Product Search New s Entertainment Others
16%
Figures 7 to 10 also give reasons for internet usage by respondents grouped into various age groups. The responses also show that e-mail is the major usage of internet.
Fig. 7: Reasons For Internet Usage (18-27yrs)
3% 23% 27%

7% 5% 35%
30%
27% Email Product Information New s Entertainment Others
20%
Email Product Inf ormation New s Entertainment Others 23%
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11% 5% 37%

11% 0% 37%
21% Email Product Inf ormation New s Entertainment Others
33%
26%
Email Product Inf ormation New s Entertainment Others
19%
The responses indicates that across all classifications (gender, employment status and age groups), there is a significant percentage (typically 20%) who uses the internet for product information. This group can become the targeted for e-commerce activities.
4.4.3. Factors that Would Influence Purchasing Online
Figs 11 to 22 capture factors that would influence respondents to purchase online goods and services. The objective was to determine if there would be differences in the responses from the following classifications: gender, age, and employment status and internet usage experience. The trustworthiness of the company offering the services was rated as the highest factor to be considered in deciding to purchase online. This indicates that for a successful promotion of e-commerce activities in Ghana, the issue of trustworthiness of the company offering services have to be considered.
The next two most important factors were convenience and faster delivery. As more people become busy at their work sites, it would be convenient to order things online and have them delivered at their office or homes. This may apply more to other cities with much higher vehicular traffic situation.
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Fig. 11: Reasons for buying on the Internet (Men)

Others (Quality of Product) Online payment systems Faster delivery Convenience cheaper Online Prices Trustw orthiness 0 5 10 15 20 25 30
Fig. 12: Reasons for buying on the Internet (Women)
Percentages
Percentages
Fig. 13: Reasons for buying on the Internet (Internet Users)
Fig. 14: Reasons for buying on the Internet (Non Internet Users)
Others (Quality of Product) Online payment systems Faster delivery Convenience cheaper Online Prices Trustw orthiness 0
Percentages
10
15
20
25
30
35
Percentages
Fig. 15: Reasons for buying on the Internet (Age: 18-27yrs)

Others (Quality of Product)
Others (Quality of Product)

Online payment systems
Online payment systems

Faster delivery
Faster delivery
Convenience
Convenience
cheaper Online Prices
cheaper Online Prices

Trustw orthiness 0 5 10 15 20 25
Trustw orthiness 0
Percentages
10
20
30
40
Percentages
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Fig. 18: Reasons for buying on the Internet (Age: 48-57)
Others (Quality of Product) Online payment systems Faster delivery Convenience cheaper Online Prices Trustw orthiness 0 10 20 30 40
Percentages
Percentages
Fig. 19: Reasons for buying on the Internet (Worker)

Others (Quality of Product) Online payment systems Faster delivery Convenience cheaper Online Prices Trustw orthiness 0 10 20 30 40
Fig. 20: Reasons for buying on the Internet (Unemploment)

Others (Quality of Product) Online payment systems Faster delivery Convenience cheaper Online Prices Trustw orthiness 0 5 10 15 20 25
Percentages
Percentages
Fig. 21: Re as ons for buying on the Internet (Retired)
Fig. 22: Reasons for buying on the Internet (Students)

Others (Quality of Product) Online payment systems Faster delivery Convenience cheaper Online Prices Trustw orthiness
Others (Quality of Product) Online payment systems Faster delivery Convenience cheaper Online Prices Trustw orthiness 0 5 10 15 20 25 30 35
10
15
20
25
Percentages
Percentages
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4.4.4. Type of products that are likely to be purchased online in Ghana:

Fig 23: Items Likely to be Purchased Online
Others (Not al all) Household appliances Food/Groceries Travel/Holidays Music Books Vehicles Electronic / phone gadgets Computer software/hardware
0 5 10 15 20 25 30
Percentages
Fig. 23 indicates that items such as computer hardware and software (26.1%), books (22.5%) and electronic/phone gadgets (13%) are the most likely items to be bought online. Items that are likely to be purchased are those that are with standard specifications. For example vehicles were rated quite low. This may be that many buy used ones as such would not consider it as prudent to purchase without inspecting or pre-testing.
4.4.5. Pricing Comparison:

Fig.24: Price Condition for Online Purchases
None of above Traditional store price expensive by over 30% Traditional store price expensive by 30% Traditional store price expensive by 20% Traditional store price expensive by 10% Traditional store price expensive by 5% Same for traditional store and Online 0 5 10 15 20 25 30 35 40
Percentages
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40% of the respondents indicated that pricing was not an issue in deciding to buy online. For these people, probably the more likely attraction is the convenience of ordering items online. They were prepared to order online even if the price was the same for a local market. About 43% of the people are likely to buy if the traditional shops are expensive by about 5-30+%. With the potential of reducing cost of items through disintermediation, it is likely to get more people to patronize online sale activities.
As the information gathered showed, many are prepared to purchase products even at the same price as those available in traditional shops like local supermarkets; the motivation being that of convenience. The internet has the potential of reducing cost through disintermediation. For goods that disintermediation leads to price reduction, such that internet prices becomes cheaper, this would become an additional incentive for buying online.
4.4.6. Issue of inability to examine physically before purchase:
Fig. 25: Issue of Impossibility of Physically Examining Items
Very High High Undecided Low Not All
10
20
30
40 Percentages
Fig.12 indicates that over 62% have issues with inability to examine the products physically before purchasing. These majority are would likely purchase goods that they have seen sample physically elsewhere.
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4.5.
Data Analysis
The survey data was analysed using cross-tabulation to highlight possible associations. The results are classified under the following categories: gender, age, job status, internet usage and ecommerce experience perspectives. Responses to a single Likert item are normally treated as ordinal data analyzed using non-parametric tests (Saleem et al., 2007). The Mann-WhitneyWilcoxon (MWW) and Kruskal-Willis (K-W) which are non-parametric tests are utilized to compare if any results achieved differ from each other.
4.5.1. The Mann-Whitney-Wilcoxon (MWW) Test The Mann-Whitney U-test is a non-parametric method which is used as an alternative to the two-sample Student's t-test. Usually this test is used to compare medians of non-normal distributions X and Y. The test works correctly under the following conditions (Bochkanov et al., 2009):
X and Y are continuous distributions (or discrete distributions well-approximating continuous distributions)
X and Y have the same shape. The only possible difference is their position (i.e. the value of the median)
the number of elements in each sample is not less than 5 the samples are independent scale of measurement should be ordinal, interval or ratio (i.e. test could not be applied to nominal variables).
The Null hypotheses (Ho) and the Alternate hypothesis (Ha) are given by (Williams, 2002):
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Ho: The two population distributions are identical. i.e., there is no significant difference between the two sample distribution. Ha: The two population distributions are not identical i.e., There is a significant difference between the two sample distributions. Using a 0.05 level of confidence, the decision is made according to the rule given in Table 4. Table 4: MWW Test Decision Rule for 0.05 level of Confidence If -1.96 z 1.96 z < -1.96 or z > 1.96 Then Accept Ho Reject Ho or Accept Ha
4.5.2. The Kruskal-Wallis (K-W) Test
The MWW test is utilized for data in two groups. The Kruskal-Wallis test (H-test) is an extension of the Wilcoxon test and can be used to test the hypothesis that a number of unpaired samples originate from the same population (Medcalc, 2009). This is a k-sample non-parametric test on the means (k > 2). All observations are pooled together (n = n1+n2++nk) and ranks are assigned to individuals. The sum of ranks, Ri for each sample is computed. The H-test statistic is given by
Where the smallest ni 5 (Todem, 2008) H = Kruskal-Wallis Test n = total number of observations in all samples Ri = Rank of the sample .
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If the null-hypothesis, being the hypothesis that the samples originate from the same population, is rejected (P<0.05), then the conclusion is that there is a statistically significant difference between at least two of the subgroups. Ho: In Kruskal- Wallis test, null hypothesis assumes that the samples are from identical populations. Ha: In Kruskal- Wallis test, alternative hypothesis assumes that the sample comes from different populations. When sample sizes are small in each group (< 5) and the number of groups is less than 4 a tabled value for the Kruskal-Wallis should be compared to the H statistic to determine the significance level. Otherwise, a Chi-square with k-1 (the number of groups-1) degrees of freedom can be used to approximate the significance level for the test (TexaSoft) If the calculated value of Kruskal- Wallis test is less than the chi-square table value, then the null hypothesis will be accepted. If the calculated value of Kruskal- Wallis test H is greater than the chi-square table value, then we will reject the null hypothesis and say that the sample comes from a different population (Statistics Solutions, 2009).
The MWW and K-S test are performed using the statistical software obtained on the internet (www.brightstat.com ).
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Chapter 5: Analysis and Findings
5.1.
Introduction
This chapter presents the results of the study conducted. Of prime importance was to investigate the level of significance of trust in B2C e-commerce. To determine this, respondents were asked to evaluate the perceived risk of purchasing from a traditional store such as a supermarket, directly online and also purchasing online but through a trusted intermediary. 5.2. Perceived Risk of Purchasing according to Gender Classification
To understand the risk of purchasing online a number of cross tabs are generated around gender, comparing how men and women perceive buying from traditional store, online (without a trusted intermediary) and online through a trusted intermediary. The results are captured in Tables 5.1.
Table 5.1a: Cross-tabulation of Gender with Risk of buying goods from Traditional Store Risk of Purchasing from Traditional Store Not at all Low Undecided High Very High Total Gender Male N (Percent) 10 (19.2) 22 (42.3) 0 (0) 17 (32.7) 3 (5.8) 52 (100.0)
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Female N (Percent) 4 (17.4) 9 (39.1) 2 (8.7) 7 (30.4) 1 (4.3) 23 (100.0)
Total N (Percent) 14 (18.7) 31 (41.3) 2 (2.7) 24 (32) 4 (5.3) 75 (100.0)
As seen from Table 5.1.a, the majority of men (62%) and women (57%) responded that it is less risky (low risk) to buy from a brick-and-mortar shop. A statistical test is performed to determine if there is a significant difference in the perceived risk of purchasing from a brickand-mortar shop from perspective of gender. The calculated z-value from the MWW test gives a value of -0.1096 which is greater than the critical value of -1.965 for a
confidence level of 0.05. Ho is not rejected as there is insufficient evidence in the sample data to conclude that there is a difference in the perceived risk of purchasing from a brick-andmortar shop from perspective of gender.
Table 5.1b: Cross-tabulation of Gender with Risk of buying goods from any Company on the Internet Risk of Purchasing from any Company on the Internet Gender Male N (Percent) 11 (21.2) 8 (15.4) 5 (9.6) 16 (30.8) 12 (23.1) 52 (100.0) Female N (Percent) 4 (17.4) 5 (21.7) 3 (13.0) 4 (17.4) 7 (30.4) 23 (100.0) Total N (Percent) 15 (20.0) 13 (17.3) 8 (10.7) 20 26.7) 19 (25.3) 75 (100.0)
Not at all Low Undecided High Very High Total
The above shows that both men (54%) and women (48%) considered buying from the internet without any trusted intermediary as a risky activity. The MWW test produced a calculated zvalue of -0.1591 indicating there is no significant difference in the perceived risk assigned by
37
males and females in purchasing online without a trusted intermediary (at the 0.05 confidence level). Table 5.1c: Cross-tabulation of Gender with Risk of buying goods on the Internet through a trusted intermediary Risk of Purchasing from Internet through a trusted intermediary Not at all Low Undecided High Very High Total Gender Male N (Percent) 12 (23.1) 30 (57.7) 3 (5.8) 5 (9.6) 2 (3.8) 52 (100.0) Female N (Percent) 3 (13.0) 15 (65.2) 3 (13.0) 2 (8.7) 0 (0) 23 (100.0) Total N (Percent) 15 (20) 45 (60) 6 (8.0) 7 (9.3) 2 (2.7) 75 (100.0)
Table 5.1.c indicates that both men (81%) and women (78%) consider buying online through a trusted intermediary as a low risk activity. The calculated z-value for this test was -0.6592 indicating no difference in the results at the 0.05 confidence level.
This results of Table 5.1.c compared to that of Table.5.1.b, show a remarkable difference in the risk perceived with the introduction of a trusted intermediary (Male=37% and Female=39% rated perceived risk as low in Table 5.1.b). This result obtained by selling through a trusted intermediary emulates that obtained for a traditional store where risk was perceived to be low.
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5.3.
Perceived Risk of Purchasing according to Internet Usage Classification
Another area worth considering is whether those who use the internet perceive risk of buying online differently from those with no internet usage experience. A number of results are tabulated below comparing perceived risk of internet usage status against traditional store, online (without a trusted intermediary) and online through a trusted intermediary. The results are captured in Tables 5.2.
Table 5.2a: Cross-tabulation of Internet Usage Status with Risk of buying goods from Traditional Store Risk of Purchasing from Traditional Store Internet Usage Status Yes No N N (Percent) (Percent) 14 0 (20.6) (0) 28 3 (41.2) (42.9) 1 1 (1.5) (14.3) 22 2 (32.4) (28.6) 3 1 (4.4) (14.3) 68 7 (100.0) (100.0) Total N (Percent) 14 (18.7) 31 (41.3) 2 (2.7) 4 (5.3) 4 (5.3) 75 (100.0)
A majority of both internet users (62%) and non-internet users (43%) rated as low the risk in purchasing from a brick-and-mortar shop. Although there appear to be much difference between the two samples, a test of MWW indicated that the differences are insignificant (zvalue was -1.2162) at the 0.05 confidence level.
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Table 5.2.b: Cross-tabulation of Internet Usage Status with Risk of buying goods from any Company on the Internet Risk of Purchasing from any Company on the Internet Not at all Low Undecided High Very High Total Internet Usage Status Yes No N N (Percent) (Percent) 15 0 (22.1) (0) 11 2 (16.2) (28.6) 7 1 (10.3) (14.3) 18 2 (26.5) (28.6) 17 2 (25.0) (28.6) 68 7 (100.0) (100.0) Total N (Percent) 15 (20.0) 13 (17.3) 8 (26.7) 20 (26.7) 19 (25.3) 75 (100.0)
Table 5.2.b shows that although the majority of both internet users (52%) and non-internet users (57%) perceive it as risky purchasing from any company at all offering such services online, there is also a sizable number of internet users (22%) who also perceive it as having no risk at all. The calculated z-value is -0.6632 indicating no significant differences between the two groups at 0.05 confidence level.
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Table 5.2.c: Cross-tabulation of Internet Usage with Risk of buying goods on the Internet through a trusted intermediary Risk of Purchasing from on the Internet through a trusted intermediary Not at all Low Undecided High Very High Total Internet Usage Status Yes No N N (Percent) (Percent) 15 0 (22.01) (0.0) 41 4 (60.2) (57.1) 5 1 (7.4) (14.3) 6 1 (8.8) (14.3) 1 1 (1.5) (14.3) 68 7 (100.0) (100.0) Total N (Percent) 15 (20.0) 45 (60.0) 6 (8.0) 7 (9.3) 2 (2.7) 75 (100.0)
Table 5.2.d: Cross-tabulation of Internet Usage Status with Likelihood of buying goods from the Internet Likelihood of buying from the internet Internet Usage Status Yes No N N (Percent) (Percent) 7 2 (10.3) (42.9) 33 3 (16.2) (28.6) 15 2 (22.0) (28.6) 9 0 (13.3) (0.0) 4 0 (5.9) (0.0) 68 7 (100.0) (100.0) Total N (Percent) 9 (12.0) 36 (48.0) 17 (22.7) 9 (12.0) 4 (5.3) 75 (100.0)
Table 5.2.c confirms that despite not having used internet before, a significant percentage of non-internet users (57%) are willing to make use of the internet to purchase goods and
41
services if being offered by a trusted intermediary. This changes the situation as seen in Table 5.2.d, where none of the non-internet users indicated a likelihood of purchasing online. As seen from Fig.14, a major reason for non-internet users purchasing online would be the trustworthiness of company offering services. It is seen that with the introduction of the trusted intermediary, the issue of trust is resolved.
Within internet user, 82% indicated a low/no risk for purchasing online through a trusted intermediary. The implication is that the successful promotion of B2C commerce within the Ghanaian market would require the use of a trusted intermediary.
5.4.
Perceived Risk of Purchasing according to Age
Tables 5.3 provide information on perceived risk according to the various age groups.
Table 5.3.a: Cross-tabulation of Age with Risk of buying goods from Traditional Store Risk of Purchasing from Traditional Store Age 18-27 28-37 38-47 Over 48 N N N N (Percent) (Percent) (Percent) (Percent) 1 7 2 4 (4.2) (23.3) (25.0) (30.7) 6 13 4 8 (25.0) (43.3) (50.0) (61.5) 0 1 1 0 (0.0) (3.3) (12.5) (0.0) 14 9 1 0 (58.3) (30.0) (12.5) (0.0) 3 0 0 1 (12.5) (0.0) (0.0) (7.7) 24 30 8 13 (100.0) (100.0) (100.0) (100.0) Total N (Percent) 14 (18.7) 31 (41.3) 2 (2.7) 24 (5.3) 4 (5.3) 75 (100.0)
With the exception of the 18-27 years group, who considered purchasing from a brick-andmortar shop as high risk, all the others indicated a low risk. The calculated H from the K-W
42
test is 17.0133 which is greater than the chi-square table value of 7.82 at 3 degrees of freedom The null-hypothesis, being that the samples originate from the same population, is rejected (P<0.05), and the conclusion is that there is a statistically significant difference between at least two of the subgroups.
Table 5.3.b: Cross-tabulation of Age with Risk of buying goods from any Company on the Internet Risk of Purchasing from any Company on the Internet Not at all Low Undecided High Very High Total Age 18-27 28-37 38-47 Over 48 N N N N (Percent) (Percent) (Percent) (Percent) 10 5 0 0 (41.7) (16.7) (0.0) (0.0) 6 6 1 0 (25.0) (20.0) (12.5) (0.0) 4 1 1 2 (16.7) (3.3) (12.5) (15.4) 3 5 3 9 (12.5) (16.7) (37.5) (69.2) 1 13 3 2 (4.2) (43.3) (37.5) (15.4) 24 30 8 13 (100.0) (100.0) (100.0) (100.0) Total N (Percent 15 (20.0) 13 (17.3) 8 (10.7) 90 (25.3) 19 (25.3) 75 (100.0)
Once again, with the exception of the 18-27 years group all other responses indicated a high risk. The low risk associated with the 18-27 years group may be as a result either lacking experience or being daring. The calculated H from the K-W test is 18.6938 which is greater than the chi-square table value of 7.82 (P<0.05), the null-hypothesis is rejected as there is a statistically significant difference between at least two of the subgroups.
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Table 5.3.c: Cross-tabulation of Age with Risk of buying goods on the Internet through a trusted intermediary Risk of Purchasing from on the Internet through a trusted intermediary Not at all Low Undecided High Very High Total Age 18-27 28-37 38-47 Over 48 N N N N (Percent) (Percent) (Percent) (Percent) 9 6 0 0 (37.5) (20.0) (0.0) (0.0) 10 20 6 9 (41.7) (66.7) (75.0) (69.2) 3 2 1 0 (12.5) (6.7) (12.5) (0.0) 2 2 0 3 (8.3) (6.7) (0.0) (23.1) 0 0 1 1 (0.0) (0.0) (12.5) (7.7) 24 30 8 13 (100.0) (100.0) (100.0) (100.0) Total N (Percent 15 (20.0) 45 (60.0) 6 (8.0) 7 (2.7) 2 (2.7) 75 (100.0)
The calculated value, H of the K-S test is 7.2565 which less than the chi-square table value of 7.82. The null hypothesis that the samples are from identical populations is accepted. With the introduction of a trusted intermediary, all the age groups considered buying online as a low risk activity. This again affirms the conclusion that promoting B2C commerce within SMEs would require the use of a trusted intermediary for it to be appealing to the various age groups.
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5.5.
Perceived Risk of Purchasing according to Previous Ecommerce Purchase Experience
Tables 5.4 provide information on the perceived risk of respondents according to their previous e-commerce experience.
Table 5.4.a: Cross-tabulation of Previous Ecommerce Purchase Experience with Risk of buying goods from Traditional Store Total Previous Ecommerce Experience N Yes No (Percent) N N (Percent) (Percent) Not at all 1 13 14 (6.7) (21.7) (18.7) Low 2 29 31 (13.3) (48.3) (41.3) Undecided 0 2 2 (0.0) (3.3) (2.7) High 11 13 24 (73.3) (21.7) (32.0) Very High 1 3 4 (6.7) (5.0) (5.3) Total 15 60 75 (100.0) (100.0) (100.0) Difference between the two columns was statistically significant (z-value= -3.1658, P<0.05). Risk of Purchasing from Traditional Store
Table 5.4.a indicates that those with prior e-commerce experience thinks of purchasing from a brick-and-mortar shop as a high risk activity. This same group also rated it as low risk activity buying online without a trusted intermediary (Table 5.4.b). The opposite is true of those without any prior internet experience. A possible explanation for the behaviour of those with prior e-commerce experience is that having successfully undertaken previous e-commerce transaction have assured them that with the right systems, purchasing online would not be any much risky than traditional ways of buying.
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Table 5.4.b: Cross-tabulation of Previous Ecommerce Purchase Experience with Risk of buying goods from any Company on the Internet Total Previous Ecommerce Experience N Yes No (Percent) N N (Percent) (Percent) Not at all 5 10 15 (33.3) (8.3) (17.3) Low 8 5 13 (53.3) (11.7) (17.3) Undecided 1 7 8 (6.7) (11.7) (10.7) High 0 20 20 (0.0) (33.3) (25.3) Very High 1 18 19 (6.7) (30.0) (25.3) Total 15 60 75 (100.0) (100.0) (100.0) Difference between the two columns was statistically significant (z-value= -3.4711, P<0.05). Table 5.4.c: Cross-tabulation of Previous Ecommerce Purchase Experience with Risk of buying goods on the Internet through a trusted intermediary Total Previous Ecommerce Experience N Yes No (Percent N N (Percent) (Percent) Not at all 6 9 15 (40.0) (15.0) (20.0) Low 8 37 45 (53.3) (61.7) (60.0) Undecided 1 5 6 (6.7) (8.3) (8.0) High 0 7 7 (0.0) (11.7) (9.3) Very High 0 2 2 (0.0) (3.3) (2.7) Total 15 60 75 (100.0) (100.0) (100.0) Difference between the two columns was statistically significant (z-value= -2.3249, P<0.05). Table 5.4.c supports previous conclusions that by the use of a trusted intermediary, the issue of trust is resolved. Risk of Purchasing from on the Internet through a trusted intermediary Risk of Purchasing from any Company on the Internet
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Chapter 6: Conclusions/Recommendations This last section summarizes the results of the study including key learning, implications and recommendations.
6.1.
Conclusions regarding study objectives
The aims of the study were to: access the level of B2C e-commerce usage and also examine the importance of trust in B2C e-commerce in Ghana: examine consumer acceptance of brokerage B2C E-commerce model in Ghana: and determine the type of products that are likely to be purchased online in Ghana.
Although B2C e-commerce is considered as important in many developing country economies, the results shows that only a small group of the Ghanaian population; about 15% are involved in online purchases in Ghana. This low response however does not necessary signify lack of interest by Ghanaians in B2C commerce as at least 40% of the respondents had indicated their willingness to buy online even if the price online is same as in the local traditional shop. The rest were willing to buy when there was a 5-30% price differential in favour of online purchases. This indicates that when prices of goods becomes cheaper online through disintermediation and other concerns are resolved, significant growth can be realized considering the present low levels of usage.
More importantly, this study has highlighted on the significance of trust in B2C commerce in Ghana. Many Ghanaians perceive online transactions involving unknown SMEs as more risky than from a local brick-and-mortar shop as over 50% of the respondents considered it risky purchasing online from an unknown business as against a score of 38% from a local shop.
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The various results have shown that the majority of respondents no matter their gender; employment status; internet usage and ecommerce experience perceive the purchasing of goods and services from companies of whom they know little about as risky. Unfortunately, most SMEs are situated within this group. The implication is that, it would be difficult for an SME to successful trade online unless the issue of trust is resolved. This issue of trust has becomes even more appropriate presently in view of the numerous reportage of internet fraud in Ghana popularly referred to as sakawa.
To combat this issue of trust, the study recommends promoting SMEs by use of the brokerage model. Adoption of this model would enable SMEs especially those without the benefit of long years of track record as a trustworthy organization to trade online.
One other area worth mentioning concern products likely to be patronised if offered online. The survey indicated that about 62% of respondents had problems purchasing items for which they have not physically examined before purchasing. Items most likely to be purchased in Ghana according to the study are computer wares, books and household items. Most of these are standard products where there is lot of information available on the internet including images. Based on this, it is concluded that for any successful promotion of B2C commerce in Ghana, the items being offered for sale should be those that are of standard specifications where consumers can buy using model and part numbers.
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6.2.
Limitations of the Study
This study was carried out only in Tamale as conducting a nationwide survey would be logistically challenging. Additionally, literature indicated that higher benefits can be generated in markets far away from business offering the service or product. It is recommended that an in-depth research should be carried out across Ghana to get a more accurate picture how consumers would behave towards B2C commerce in Ghana. The above limitations not withstanding, the findings of this survey indicate in a large way that B2C commerce can be viable under the present business environment if the issue of trust is resolved through the use of a trusted broker and standardised products are offered.
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Appendix 1 GIMPA BUSINESS SCHOOL (E-COMMERCE SURVEY) Please take a few minutes to complete this survey questionnaire. Your specific answer(s) will be completely confidential, but your views, in combination with those of others, are extremely important 1. Age (yrs) 18-27 2. Gender Male 28-37 Female 48-57 Over 58
38-47
3. Which of these best describes your job? Worker Unemployed Retired Student
4. Do you use the Internet? Yes No
5. For which of the following reason(s) do you use the internet? Select all that applies. E-mail ............................................................................................... Search for information on products ................................................... News................................................................................................. Entertainment.................................................................................... Other (PLEASE WRITE IN) _______________________________ 6. Have you purchased goods on the internet before? Yes No 7. Some companies display prices of their goods on their website and offer means by which you can pay through the internet whereby the item is delivered through the internet or by post (e-commerce). If a company offers e-commerce services, what is the likelihood of buying products from them through the internet? Not at all low undecided high very high
8. Which of the following factor(s) would influence you to purchase goods on the internet (e-commerce)? Select all that applies. Trustworthiness of company offering such service Item being purchased is cheaper through the internet Convenience Faster delivery. Available online payment systems.. Other (PLEASE WRITE IN) _____________________ __
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9. If there is a new company offering goods on a website for sale, what is the likelihood of you buying from them via the internet? Not at all low undecided high very high
10. Which of the following are you likely to buy on the Internet? Computer software/hardware .. Electronic / phone gadgets ... Vehicles ........................................................................................... Books ............................................................................................... Music ................................................................................................ Travel/Holidays ................................................................................ Food/Groceries ................................................................................. Household appliances ....................................................................... Other (PLEASE WRITE IN) _______________________________ ____________________________________________________________ 11. Under which of the following price conditions would you buy through traditional store (e.g. local supermarket) than through the internet? The price is the same for both traditional store and on the internet. Traditional store price expensive by 5%...................................................... Traditional store price expensive by 10%.................................................... Traditional store price expensive by 20%.................................................... Traditional store price expensive by 30%.................................................... Traditional store price expensive by over 30%........................................... None of above.. 12. How risky would you say it is to buy goods from a traditional store (e.g. supermarket)? Not at all low undecided high very high
13. How risky would you say it is to buy goods via the internet? Not at all low undecided high very high
14. If a reputable organization, e.g. government agency, bank; would serve as an agent (intermediary) for the purchase transaction, how risky would you say it is to buy goods via the internet? Not at all low undecided high very high
15. It is usually impossible for you to physically examine items displayed on a website before purchase. How much do you see this as a problem in buying products via the internet? Not at all low undecided high very high
Thank you for your support

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List of References 1. Folorunso O, Awe O. G., Sharma S. K. and Jeff Z. Factors Affecting the Adoption of Ecommerce: A Study in Nigeria. Journal of Applied Sciences 6 (10): 2224-2230. ISSN 1812-5654, Asian Network for Scientific Information, 2006. 2. Hinson R., Saffu K. and Walker J. H. Strategic value and electronic commerce adoption among small and medium-sized enterprises in a transitional economy. Journal of Business & Industrial Marketing 23/6 (2008) 395404q Emerald Group Publishing Limited [ISSN 0885-8624], 2008. 3. Iacovou, C.L., Benbasat, I., and Dexter, A.A. Electronic Data Interchange and Small Organisations: Adoption and Impact of Technology, MIS Quarterly, 19, 4, 465-485, 1995. 4. eMarketer, World's Web Users Are Shopping Online (http://www.emarketer.com/Article.aspx?id=1005884 ), 2008. 5. Van Toorn C., Bunker D., Yee K. and Smith S. The Barriers to the Adoption of Ecommerce by Micro Businesses, Small Businesses and Medium Enterprises. Sixth International Conference on Knowledge, Culture and Change in Organisations - 2006 6. iResearch Transaction Volume of Global B2C Ecommerce Market (http://english.iresearch.com.cn/views/E_Commerce/DetailNews.asp?id=7561), 2006. 7. Nielsen Global Online Survey on Internet shopping habits http://my.nielsen.com/site/20080414.shtml ), 2008. 8. Mahesha Kapurubandara and Robyn Lawson, Barriers to Adopting ICT and e-commerce with SMEs in Developing Countries: An Exploratory study in Sri Lanka, 2006. 9. UNCTAD. E -Commerce and Development Report 2001, United Nations Conference on Trade and Development, United Nations, New York and Geneva. Internet Edition, 2001. 10. UNCTAD. E -Commerce and Development Report 2002, United Nations Conference on Trade and Development, United Nations, New York and Geneva. Internet edition, 2002. 11. UNCTAD. E -Commerce and Development Report 2004, United Nations Conference on Trade and Development, United Nations, New York and Geneva. : Internet edition, 2004. 12. UNCTAD. E-Commerce Strategies for Development: Selected Trade and Development Aspects of Information and Communication Technologies, United Nations Conference on Trade and Development, United Nations, New York and Geneva, 2005. 13. Shemi P. Alice and Magembe A. S. Beatrice. Challenges and Prospects of e-Commerce in Africa: The need for strategic alliances and collaboration, 2003 14. Laudon C. Kenneth and Laudon P. Jane. Management Information Systems: Managing the Digital Firm: Ninth Edition, 2006. 15. Mensah O. Aida, Bahta A and Mhlanga S. E-commerce challenges in Africa: Issues, Constraints, and Opportunities. Briefing Paper, 2005. 16. ECA. Key Challenges to Implementing E-Commerce in Ghana, 2006. 17. Kayanula D and Quartey P. The Policy Environment for Promoting Small and Medium Enterprises in Ghana and Malawi, IDPM Finance and Development Research Programme Working Paper No. 15, 2000. 18. Pobobsky G. Small and Medium Enterprises and Labour Law, International Labour Review, vol. 131, No. 6, 1992. 19. Zorayda, R. Andam. E-Commerce and e-Business. E-ASEAN Task Force, UNDP APDIP, 2003 20. Ekin Caglar, Baigalmaa G. and Yaprak T. A Road To E-Commerce Success: Joint eVenture, Presented at the e4SME conference, Manchester (UK), on 18 June 2003, e4SME Series - Making Electronic Commerce work for Small and Medium Enterprises, 2003.
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21. Mensah S. A Review of SME Financing Schemes in Ghana, Presented at the UNIDO Regional Workshop of Financing Small and Medium Scale Enterprises, Accra, Ghana, 2004. 22. Poon S. and Jevons C. Internet-enabled international marketing: a small business network perspective - JOURNAL OF MARKETING MANAGEMENT, ACADEMIC PRESS, 1997. 23. Professor Clement Dzidonu, the SCAN-ICT Pilot Project, An Empirical Study of the Development, Deployment and the Exploitation of ICTs in Ghana, 2002. 24. Organisation for Economic Co-operation and Development, OECD ICT, E-Business and SMEs, 2004. 25. GNA. Ghana Post to diversify services - myZongo Press the News, We do the Rest.mht, 2006. 26. TexaSoft, WINKS statistics tutorials (http://www.texasoft.com/tutorial-chisquarecrosstabulation.html), 2008. 27. Rajagopalan V. Selected Statiscal Tests. New Age International Publishers, 2006. 28. Saleem J. Jason, Emily S Patterson and Laura Militello. Impact of Clinical Reminder Redesign on Learnability, Efficiency, Usability, and Workload for Ambulatory Clinic Nurses, 2007 29. Bochkanov S. and Bystritsky V., Mann-Whitney U-test (www.alglib.net ) 30. Williams S. A., Statistics for Business and Economics, 8 th Edition, South-Western College Publishing/Thomson Learning, 2002 31. Medcalc, (http://www.medcalc.be/manual/kruskal-wallis_test.php ), 2009. 32. Todem David, (http://www.msu.edu/~fuw/teaching/Fu_ch9_2_Nonpara.ppt ), 2008 33. Statistics Solution (http://www.statisticssolutions.com/kruskal-wallis-test ), 2009. 34. Cloete H. How does Information Technology Influence Small Business Growth. Technical Report to the Department of Information Systems, University of Cape Town, 1999.
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Promoting SMEs Through E-Commerce

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GHANA INSTITUTE OF MANAGEMENT AND PUBLIC ADMINISTRATION

By STEPHEN DANSO ADUAMA

.. (STEPHEN DANSO ADUAMA) (Participant) .. (PROFESSOR PAUL N. BUATSI) (Supervisor)

.. Checked for Possible Plagiarized Material ( (Librarian)

Dedication This work is dedicated to my family for the wonderful support.

Background to the Study

Statement of the Problem

Objectives of the Study

Significance of the Study

Structure of the Study

Chapter 2: Literature Review 2.1. Introduction

Ghana SME Sector

Benefits of Ecommerce to SMEs

countries to utilize ICT (Duncombe and Heeks, 2001).

Barriers to e-commerce Adoption by SMEs in Developing Countries

Barriers to e-commerce Adoption by SMEs in Ghana

Suitable payment systems

2.6.6. Logistics for Delivery of Indirect e-commerce products

Chapter 3: Conceptual Framework

The Study Objectives

Design method and techniques to gather data 4.3.1. Study Tool

4.4.2. Reasons of Using the Internet

Fig.2: Reasons For Internet Usage (Women)

Email Product Search News Entertainment Others

Email Product Search News Entertainment Others

Fig.3: Reasons For Internet Usage (Workers)

Fig. 4: Reasons For Internet Usage (Unemployed)

27% 22% Email Product Search News Entertainment Others

Fig. 5: Reasons For Internet Usage (Retired)

Fig 6: Reasons For Internet Usage (Students)

Email Product Search New s Entertainment Others

28% Email Product Search New s Entertainment Others

Fig. 8: Reasons For Internet Usage (28-37yrs)

27% Email Product Information New s Entertainment Others

Fig. 9: Reasons For Internet Usage (38-47yrs)

Fig. 10: Reasons For Internet Usage (48-57yrs)

21% Email Product Inf ormation New s Entertainment Others

Email Product Inf ormation New s Entertainment Others

4.4.3. Factors that Would Influence Purchasing Online

Fig. 11: Reasons for buying on the Internet (Men)

Fig. 12: Reasons for buying on the Internet (Women)

Fig. 13: Reasons for buying on the Internet (Internet Users)

Fig. 15: Reasons for buying on the Internet (Age: 18-27yrs)

Fig. 16: Reasons for buying on the Internet (Age: 28-37yrs)

Others (Quality of Product)

Online payment systems

cheaper Online Prices

Fig. 17: Reasons for buying on the Internet (Age: 38-47yrs)

Fig. 18: Reasons for buying on the Internet (Age: 48-57)

Fig. 19: Reasons for buying on the Internet (Worker)

Fig. 20: Reasons for buying on the Internet (Unemploment)

Fig. 21: Re as ons for buying on the Internet (Retired)

Fig. 22: Reasons for buying on the Internet (Students)

4.4.4. Type of products that are likely to be purchased online in Ghana:

4.4.5. Pricing Comparison:

4.4.6. Issue of inability to examine physically before purchase:

Fig. 25: Issue of Impossibility of Physically Examining Items

Very High High Undecided Low Not All

4.5.2. The Kruskal-Wallis (K-W) Test

Chapter 5: Analysis and Findings

Female N (Percent) 4 (17.4) 9 (39.1) 2 (8.7) 7 (30.4) 1 (4.3) 23 (100.0)

Total N (Percent) 14 (18.7) 31 (41.3) 2 (2.7) 24 (32) 4 (5.3) 75 (100.0)

Not at all Low Undecided High Very High Total