Impact of factors influencing use of e-commerce on performance of Malaysian small and medium enterprise

Despite the huge government effort spent, the performance of Small and medium enterprise (SME) in Malaysia has not been in tandem with the pace of other nations. In this light, e-commerce offers the resolution to improve the SME performance. However, the e-commerce technology available in Malaysia has not been fully utilized. This research focuses on SMEs’ adoption of technology and its impacts on their performance. This research examines the relationships among performance expectancy, effort expectancy, social influence, facilitating condition, perceived risk, use of e-commerce and SME performance. The research framework has been developed based on Resource-Based View (RBV) and Unified Theory of Acceptance & Use of Technology (UTAUT). The research data were collected from Malaysian SMEs operators who adopted e-commerce. A total of 1,595 companies were studied. Out of which 202 questionnaires were returned. This research used census sampling technique while the data were analyzed by using the SPSS 20 and SmartPLS 3.0 to examine its measurement model and structural model. The results showed that performance expectancy, effort expectancy, facilitating conditions and perceived risk have a significant direct relationship with the use of e-commerce, except social influence. The use of e-commerce has shown a significant direct relationship with SME performance. Besides that, the use of e-commerce as a mediating variable revealed that with the significant use of e-commerce by SMEs, performance expectancy, effort expectancy, facilitating conditions and perceived risk influenced SME performance except social influence. Thus, the findings of this research provide important insights to policymakers, researcher and industry players to create further understanding on the impact of e-commerce adoption on SMEs performance