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Last Updated: Wednesday, 21 November 2007, 00:06 GMT
Do small firms really need a website?
By Alison Swersky
Business reporter, BBC News

As far as web-literate consumers are concerned, internet search engines generally offer the best way to track down a local plumber or find out where the local pet shop is based.

Martha Lane Fox and co-founder of Lastmuinute.com Brent Hoberman pose to promote the website
The boundaries of internet and traditional start-ups have blurred

After all, a reputable company will have its own website, right?

Wrong.

In a world where e-trading has become as mainstream as microwaved ready meals, it comes as a shock to many to discover that no more than half of Britain's small to medium-sized businesses have a web presence.

But those are the facts, according to the Federation of Small Businesses, which represents about 210,000 firms.

After a flurry of activity a few years ago, when a steady stream of its members flocked into cyberspace, demand has stagnated.

Which is a shame, according to the Federation's IT chairman, Peter Scargill, who insist companies must "keep up or lose out".

This is more than ever the case in today's business climate as many companies struggle to grasp the impact of the next wave of internet technology.

So-called web 2.0, blogs, wikis and web-on-your-mobile are giving ever greater power and choice to the consumer.

Many shrewd players are racing to adapt and respond to compete in both the offline and online market place.

Does this mean that those existing only in the real world are being left behind?

No web presence

Not so, says entrepreneur Lorrain Corrance, a qualified carer from Barrow-in-Furness who she set up a company to look after sick and disabled people.

Priorities will differ from business to business but the web will be integral to a business plan on some level
George Derbyshire, head of the National Federation of Enterprise Agencies

Driven by disgruntlement, after feeling disappointed with a former employer's attitude to care, Ms Corrance's set up One to One Personal Care.

The company now has one full-time employee, one part-time cover and five clients, and so far all her clients have come through social services or recommendations.

"I don't feel like I need a website," Ms Corrance says.

"The whole point of my business is that each client will have one dedicated carer who will offer a high standard of care.

"I don't want my business to grow more quickly than I can handle because I don't want to have to let people down if I don't have the staff to provide the services."

Vital tool?

James Pople, who runs a building contractor firm in Tunbridge Wells, is not convinced that a website is an essential tool for business success.

Wiggly Wigglers' worm composting kit
Wiggly Wigglers has gained global recognition through its podcasts

Nine months after his website went live, he insists it has not generated a single phone call from a customer.

Instead, his website functions as a catalogue of his work.

It was for this reason alone, after repeated requests from potential customers, that Mr Pople says he even bothered to launch a website at all.

"Perhaps it is just useful for giving clients peace of mind before making enquiries," he says.

But this view of the internet as an afterthought must change as new technologies fundamentally alter consumer behaviour, according to the National Federation of Enterprise Agencies.

"Priorities will differ from business to business but the web will be integral to a business plan on some level, whether it forms part of your communications and marketing strategy, part of your supply or customer chain, or whether you use it to trade," says the group's chief executive, George Derbyshire.

Fully engaged

Heather Gorringe, chairman and founder of Wiggly Wigglers, could not agree more. Offline companies are truly missing a trick, she believes, having experienced the power of the web for herself.

When the internet was still in its infancy, she saw its potential to expand her worm composting kit enterprise well beyond the village where it is based and the firm's website went live in 1995.

"We are based on a farm in a village of 63 people in rural Herefordshire," she says. "The passing trade is virtually nil."

The site was adapted for e-commerce in the white heat of the tech boom in 1999, when turnover surged from 6,000 in 1995 to 200,000.

Facebook website
Firms use social networking sites to communicate with customers

And the dot.com crash did little to dent Wiggly Wigglers' performance. The company's turnover has now reached 2.5m. Its customers come from all over the UK, the Irish Republic and Western Europe and has its own group on social networking site Facebook.

In addition, gardening podcasts, featured regularly and downloadable from the website, have boosted the company's profile with a fan base from the US to New Zealand and China.

"Growing a brand globally has helped sales locally," Heather observes.

"Communicating with potential influencers is important for every business, even if you are a local fish and chip shop".

The reason why so many companies are disappointed with their website's performance is that they have failed to maximise their potential, believes Mr Scargill.

"A website is a passive device," he says.

"Unless you have a well recognised brand name you need to have some way for people to find your site.

"If you haven't marketed it properly, it's like taking a bunch of brochures, putting them in a cupboard and then wondering why sales aren't going up."

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