The lack of anticipated engagement in e-business by Small and Medium sized Enterprises (SMEs) is a rising concern to the UK government and service providers alike. This article is based on the e-adoption model to examine the current practice of e-business technology adoption in SMEs and the driving forces for and against the adoption. Through interviews with 40 owner managers in the electronic components industry, the article reveals that most of the small firms in this industry are at the lower level of the “e-adoption ladder”—predominantly using the Internet and e-mail. SMEs in this industry have not yet widely engaged in online transactions. The current level of adoption is driven by both internal and external factors, including operational benefits, industry common practice, and peer pressure. External forces such as a lack of push from suppliers and customers and a lack of strategic vision of using advanced e-business technology for competitive advantages have determinant effects on the level and scale of e-adoption in SME sector. The e-adoption ladder model is modified by incorporating the influential factors identified within this study. The findings have many implications for researchers, service providers, and policy makers.
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