Impact of e-commerce applications on business performance
The impact of e-commerce applications on business performance includes improved operations efficiency, reduced operational costs, sales growth, customer satisfaction, expanded customer/market base, competitive advantage, increased turnover, increased profits, higher return on assets (ROA), and better job performance, among other benefits.
Following are empirical studies showing the impact of e-commerce applications and technologies on business performance in various places across the globe.
This study sought to examine the impact of e-commerce adoption on the performance of SMEs in Mbarara City, Uganda. It also sought to establish the effect of revenue growth on the performance of SMEs in the target firms. Lastly, the study sought to determine the role of cost reduction in enhancing the performance of SMEs in the study area. The target population included 150 SMEs operating in the retail, manufacturing, and service industries in Mbarara City, Uganda. Participants in the study included the owners and managers of target SMEs in the study area. Data collection was done using a questionnaire and semi-structured interviews. Descriptive statistics, including frequencies, percentages, means, and standard deviations, were used to summarize the demographic characteristics of the respondents. Descriptive statistics were also used to provide an overview pertaining to the distribution of the rates of e-commerce adoption and performance outcomes. Inferential statistics was done using multiple regression analysis to establish the relationship between the adoption of e-commerce and SME performance (Arinaitwe, 2025).
The findings revealed a positive and significant relationship between adoption of e-commerce and SME performance. This means that SMEs that deployed e-commerce were 4.48 times more likely to report an improvement in their performance. Also, revenue growth was shown to have a positive and significant relationship with SME performance. This suggests that SMEs that registered higher growth were more likely to report improved performance. The results also demonstrated that cost reduction had a positive but insignificant influence on SME performance. The findings also revealed that customer acquisition had a positive and significant effect on SME performance. In other words, SMEs that had the capacity to acquire more customers were more likely to report enhanced performance (Arinaitwe, 2025).
The study sought to determine the role of e-commerce on the financial and non-financial performance of SMEs in Saudi Arabia. Specifically, the study explored the following objectives: the extent to which e-commerce impacts the operational performance of SMEs, the impact of e-commerce on SMEs’ financial performance, and the impact of e-commerce on market-based performance of SMEs. The target population included all the SMEs operating in different sectors in the Kingdom of Saudi Arabia. A convenient sampling technique was used to select 230 respondents to participate in the present study. Data collection was enabled using a questionnaire. Descriptive statistics (mean, percentage, and frequencies) were used to analyze demographic variables in the study. Inferential statistics was used to evaluate the relationship between dependent and independent variables. The findings were presented in relevant tables as required (Almuwallad & Alhumoudi, 2024).
In terms of operational performance, the findings revealed that adoption of e-commerce by SMEs had led to the following outcomes: an improvement in operational efficiency of the SME, an increase in sales revenue, and an expansion of SME customer base. In terms of financial operation, the results demonstrated that adoption of e-commerce had led to a reduction in operational costs and an improvement in financial performance of the SME. In terms of market-based performance, the findings revealed that adoption of e-commerce had led to an expansion of the market base and the ability to reach new markets. The results showed that adoption of e-commerce had also led to increased brand recognition and awareness. This means that adoption of e-commerce by SMEs in the Kingdom of Saudi Arabia had a positive impact on market-based performance. In summary, the results of correlation and regression analysis showed that there is a positive and significant relationship between operation performance, financial performance, market base performance, and organizational performance in Saudi Arabian SMEs. This means that a unit improvement in operations, finances, and market base of the SMEs would lead to a corresponding increase in organizational performance, all other factors remaining constant (Almuwallad & Alhumoudi, 2024).
This study investigated the impact of e-commerce adoption on the performance of micro and small industries (MSIs) in Indonesia with firm size as the moderating variable. The target population included all the 1048 MSIs operating in Karanganyar Regency in the Central Java Province of Indonesia from 2020 to 2022. Secondary data about these MSIs was accessed and used for study. MSI’s financial performance was represented by the values of sales or turnover, profit, and return on asset (ROA). E-commerce was used as a dummy variable that was assigned the value 1 in case the MSI engages in e-commerce and 0 if it does not. Firm size (control variable) was determined by considering the number of workers employed in the MSI. Descriptive statistics (frequencies, percentages) were used to provide an overview of the variables under study. A multiple linear regression (OLS) model was used to establish the relationship between the variables under investigation. Results of data analysis were presented in suitable tables as needed (Setiawan et al., 2023).
The results showed a positive and significant relationship between e-commerce and MSIs’ financial performance. The results indicated that MSIs that deployed e-commerce recorded higher turnover than those who did not. MSIs who deployed e-commerce also had a higher ROA than those who did not. The findings also showed that firm size, as a moderating variable, had a positive and significant effect on MSIs’ turnover, profit, and ROA. That means increasing the number of workers by a given MSI would lead to increased turnover, profits, and ROA (with other variables remaining constant). The findings also established that e-commerce performs better in improving MSIs’ financial performance when firm size is smaller. Ultimately, the study demonstrated that e-commerce improves the financial performance of MSIs in Karanganyar Regency, in the Central Java region of Indonesia (Setiawan et al., 2023).
This study explored the impact of adopting e-commerce on the performance of SMEs in Saudi Arabia. Specifically, the study examined whether adoption of e-commerce has a positive impact on business-to-customer SMEs. It also sought to determine whether the experience of using e-commerce technologies impacts the performance of business-to-customer SMEs. The study also sought to establish whether firm size mediates the relationship between adoption of e-commerce and performance of business-to-customer SMEs. The target population included Saudi Arabian SMEs operating in the manufacturing, trading, electronics, business service, and pharmaceuticals industries (Ismael & Lingtong, 2022).
A sample size of 200 respondents was selected using the convenience sampling technique. Data collection was done using questionnaires. Self-reported measures were used to determine financial performance of the SMEs in terms of sales growth, customer satisfaction, customer base, process enhancement, and competitive advantage. Descriptive statistics were used to summarize the variables under study. Factor analysis was done to evaluate the dimensionality of the variables being investigated. Multiple regression analysis was used to test the hypotheses of the study. The results were presented using relevant tables (Ismael & Lingtong, 2022).
The results showed that adoption of e-commerce had a positive and significant effect on the performance of SMEs in Saudi Arabia. The results also showed that firm size strongly moderates the relationship between adoption of e-commerce and SME performance (Ismael & Lingtong, 2022).
This study explored the effect of e-commerce on performance of MSMEs in Jakarta,the performance Indonesia. Specifically, the study sought to establish whether e-commerce communication affects the performance of MSMEs in Jakarta. It also sought to determine the effect of e-commerce business processes on the performance of MSMEs in the study area. The study also sought to find out the effect of e-commerce services on the performance of MSMEs in the study area. The study also explored the relationship between online e-commerce and the performance of MSMEs in Jakarta. The study also sought to establish the impact of digital e-commerce platforms on MSMEs. The study also explored the moderating role of environmental perspective on the relationship between e-commerce communication and MSME performance. The study also explored the moderating role of environmental perspective on the relationship between e-commerce business processes and MSME performance. It also explored the moderating role of environmental perspective on the relationship between e-commerce services and MSME performance. It also examined the moderating role of environmental perspective on the relationship between online e-commerce and MSME performance. Lastly, the study explored the moderating role of environmental perspective on the relationship between digital e-commerce and MSME performance (Sormin & Khomsiyah, 2021).
The target population included 16,588 MSMEs operating in different industries in DKI Jakarta Province, Indonesia. This information is derived from the 2019 IMK Survey from the Central Statistics Agency of DKI Jarkata. Using purposive sampling, 172 respondents were selected from the target MSMEs to participate in the study. These included MSMEs that had adopted e-commerce and had been in operation for the last one year. Descriptive statistics were used to analyze the variables under study in terms of mean, frequencies, and percentages. The findings were presented using relevant tables as required (Sormin & Khomsiyah, 2021).
The results showed a positive and significant relationship between the following variables: e-commerce communication and MSME performance; e-commerce business processes and MSME performance; online e-commerce and MSME performance; and digital e-commerce platforms and MSME performance. On the other hand, the results showed a negative and insignificant relationship between of e-commerce services and the performanc of MSMEs in Jakarta (Sormin & Khomsiyah, 2021).
The findings also revealed that environmental perspective positively and significantly mediates the relationship between e-commerce and MSME performance and the relationship between online e-commerce businesses and MSME performance. On the other hand, the results showed that environmental perspective does not significantly mediate the relationship between the following variables: e-commerce communication and MSME performance, e-commerce services and MSME performance, and digital e-commerce platforms and MSME performance (Sormin & Khomsiyah, 2021).
This study investigated the effect of e-commerce on the financial performance of listed food and beverage firms in Nigeria. Specifically, the researcher set out to establish the effect of business-to-business e-commerce on Return of Sales (ROS) of target firms. It also sought to determine the effect of business-to-client e-commerce on Return on Sales (ROS) in the target firms. The target population included 16 food and beverage firms listed in Nigeria, which had consistently published their annual financial reports from 2011 to 2021. Data was collected using questionnaires. Data analysis was done using descriptive statistics and the panel multiple regression technique. The findings were presented in tables as needed (Lambe et al, 2021).
The results demonstrated a positive and significant relationship between business-to-business e-commerce and return on sales. This means that a unit increase in business-to-business will lead to a corresponding increase in return on sales. The findings also indicated a positive and significant relationship between business to client and return on sales. Furthermore, the findings revealed a negative and significant relationship between firm size and return on sales in the target organizations (Lambe et al., 2021).
This study investigated the impact of e-commerce on selected supermarkets in Ibadan Metropolis, Nigeria. The study sought to establish the effect of e-commerce usage on service operations. It also set out to determine the effect of e-commerce usage on operation costs. Lastly, the study examined the effect of e-commerce usage on the profitability of the business. The target population included 8 supermarkets in the target location. 48 respondents (including owners and employees) were selected from these supermarkets to participate in the study. Data was collected using a questionnaire. Descriptive statistics were used to analyze the data in terms of frequencies, percentages, mean, and deviations. Easy regression analysis was used to establish the relationship between variables under study. Results were presented using tables as required (Ismael & Lingtong, 2020).
The results demonstrated a positive and significant relationship between e-commerce adoption and business operations. Specifically, adoption of e-commerce was shown to enhance service delivery in the target supermarkets. In addition, the findings showed that adoption of e-commerce had led to a significant increase in cost savings in the target supermarkets. It was also demonstrated that adoption of e-commerce had led to a significant reduction in operational costs in the target supermarkets. These results imply that adoption of e-commerce has a positive and significant impact on the performance of supermarkets operating in Ibadan Metropolis, Nigeria (Ismael & Lingtong, 2020).
This study investigated the mediating role of Internet sales channels on the relationship between e-commerce and the performance of SMEs in the European Union (EU). Specifically, the study sought to establish whether the effect of e-commerce on SME performance is mediated by sales made over commercial websites, online marketplaces, and search engines. The target population included 863 SMEs operating in different sectors in the EU. E-commerce was measured by considering how a firm sells its products over the Internet, that is, commercial websites, online marketplaces, and search engines. Firm size was determined by considering the number of employees. Data collection was done using questionnaires. Descriptive statistics were used to evaluate the demographics of the study. Ordinary Least-Squares (OLS) regression was used to establish the relationship between the variables under study. The results were presented in suitable tables (Jovanovic et al., 2020).
The findings revealed that adoption of e-commerce does not automatically lead to improved SME performance in the target firms. This is because the results of this study indicated that the link between e-commerce and SME performance is not direct and thus requires further interrogation. On the other hand, the results demonstrated that SME size and year of establishment both have a positive and significant impact on the performance of SMEs. Furthermore, in considering the mediating effect of Internet sales channels on the relationship between e-commerce and SME performance, it was reported that use of commercial websites to sell on the Internet positively and significantly influenced SME performance. Also, the findings indicated that online marketplaces had a positive and significant impact on SME performance. This means that online marketplaces play a significant mediating role in the relationship between e-commerce and SME performance. Lastly, the results revealed that use of search engines for selling products does not have a significant influence on the relationship between e-commerce and SME performance (Jovanovic et al., 2020).
This study explored the relationship between the adoption of e-commerce applications (including e-marketing systems, e-advertising systems, e-customer support services, e-payment systems, and e-order and delivery systems) and the performance of travel agency firms in India. The target population included 269 travel agencies located in three main cities in India (that is, Delhi, Jaipur, and Agra). Data collection was done using a questionnaire. Respondents were drawn from the staffs of the target travel agencies. The collected data was analyzed using descriptive statistics (frequencies, percentages, means) and inferential analysis. The results of the study were presented in suitable tables as needed (Sunayana & Parveen, 2019).
The results demonstrated that there was a positive and significant relationship between the variables: electronic marketing and performance of travel agencies in India; electronic advertising and performance of the travel agencies; electronic customer support systems and performance of the travel agencies; electronic order & delivery and performance of the target travel agencies; and finally, electronic payment systems and performance of the travel agencies. This implies that adoption of e-commerce applications by travel agencies in India led to better organizational performance (Sunayana & Parveen, 2019).
This study examined the effect of e-commerce on organization performance in Pakistan. Specifically, the study explored the influence of e-commerce on organization performance. It also examined the influence of social media on organization performance. Lastly, it explored the moderating role played by social media on the relationship between e-commerce and organization performance. The target population included 187 university students in Pakistan who buy things online. Data collection was done using questionnaires. Descriptive statistics (frequencies, percentages, mean) were used for data analysis. The Partial Least Squares (PLS-SEM) technique was also used for measurement and structural models. The findings were presented using relevant tables as needed (Bhatti & Rehman, 2019).
The results revealed a positive and significant relationship between e-commerce and organization performance in Pakistan. Secondly, social media was shown to have a positive and significant influence on organization performance. Lastly, the findings revealed that social media actually plays a moderating role in the relationship between e-commerce and organization performance (Bhatti & Rehman, 2019).
This study sought to determine the mediating role of competitive advantage on the relationship between e-commerce adoption and SME performance in Banyuwangi East Java,Banyuwangi, Indonesia. Specifically, the study sought to determine the relationship between e-commerce and competitive advantage. It also sought to establish whether there is a significant relationship between e-commerce and SME performance. The study also examined the moderating role played by competitive advantage in the relationship between e-commerce and SMEs’ performance. Lastly, the researcher sought to demonstrate whether the relationship between competitive advantage and SME performance was significant. The target population included all 209 SMEs assisted by the Banyuwangi Regency Cooperative and the UMKM OFFICE. A sample size of 137 SME owners was arrived at using Slovin formula. Data collection was done using questionnaires. The collected data was analyzed using descriptive statistics (frequencies, percentages, mean, and deviation). In order to establish the relationship between study variables, correlation analysis was done (Hariandi et al., 2019).
The findings demonstrated a positive and significant effect of e-commerce on competitive advantage. The findings also revealed that e-commerce had an insignificant effect on SME performance. The results also showed that competitive advantage had a positive and significant impact on SME performance. In addition, the findings revealed that competitive advantage fully mediates the relationship between e-commerce and performance of SMEs. Lastly, the findings revealed that the influence of e-commerce on SME performance is getting bigger in the study area (Hariandi et al., 2019).
This study investigated the effect of web-based business on hierarchical execution at the Saamionline organization in Hargeisa. More specifically, the study sought to determine the effect of business-to-consumer on authoritative execution in the target organization. It also sought to establish the effect of business-to-business on authoritative execution in the target organization. Lastly, the study explored the effect of consumer-to-consumer on authoritative execution in the target organization. The target population included the staff at Saamionline company. 52 respondents were selected to participate in this study out of the 60 employees of the target company. Questionnaires were used to collect data from the respondents. Descriptive statistics (frequencies and percentages) were used to analyze the collected data. Pearson correlation was used to examine the relationship between variables under study. The findings were presented in suitable tables as required (Abdi, 2018).
The findings revealed a positive and significant relationship between electronic commerce implementation and organization performance at Saamionline Company, Hargeisa. The findings revealed that business-to-business strongly impacts authoritative execution. The results also showed that the effect of business to buyer on authoritative execution was high. Lastly, it was demonstrated that consumer-to-consumer greatly impacts authoritative execution (Abdi, 2018).
This study investigated the effect of e-commerce on the performance of SMEs in Tehran. The target population included all SMEs operating in different sectors in Tehran. The target SMEs were those that have employed at least 10 people. The population sample for the study was obtained using Kerjcie-Morgan’s table. Data collection was done using a questionnaire. Data analysis was done using structural equation modeling (SEM). Pearson Least Square (PLS) was used to explore the relationship between variables under study. The findings were presented using relevant tables as required (Sedighi & Sirang, 2018).
The findings revealed a positive and significant relationship between the variables: e-commerce and financial performance, e-commerce and internal processes, e-commerce and customers, e-commerce and growth & learning, and e-commerce and innovation (Sedighi & Sirang, 2018).
This study explored the impact of e-commerce on the performance of business organizations in Harare, Zimbabwe. It sought to establish whether adoption of e-commerce could lead to improved service delivery, cost efficiency, and increased profits. The target population included 10 e-commerce organizations in the study area. Data collection was done using questionnaires. The respondents were people well versed with the operations and functionality of the e-commerce technology, together with those who work in the accounts department. Descriptive statistics were used to analyze the collected data. Regression analysis was used to establish the relationship between the dependent and independent variables. The findings were presented in relevant tables as required (Hurasha & Chiremba, 2016).
The findings revealed a positive and significant relationship between e-commerce and the profit margin, cost reduction, and service operations (Hurasha & Chiremba, 2016).
This study examined the impact of business-to-business, business-to-customer, and customer-to-customer e-commerce on bank performance (measured by business operation, job performance, and customer satisfaction) in Pakistan. Specifically, the study sought to determine whether there is a positive and significant relationship between e-commerce and bank performance. It also sought to establish whether there is a positive relationship between e-commerce and business operations. It also set out to determine whether there is a positive relationship between e-commerce and customer satisfaction. Lastly, the study sought to find out whether e-commerce impacts bank performance. The target population included the 80 commercial banks operating in the City of Lahore, Pakistan. The bank managers and operation managers were the main respondents in the study. Data collection was achieved using questionnaires. Descriptive statistics were used to analyze data using frequencies, percentages, mean, and deviation. Pearson correlation analysis and regression analysis models were used to explore the relationship between study variables. The findings were presented using relevant tables (Azeem et al., 2015).
The results of correlation analysis indicated a positive relationship between e-commerce and the performance of the bank. The findings also demonstrated a positive relationship between e-commerce and business operations. In other words, if banks employed e-commerce, then their operations were bound to improve. In addition, the results demonstrated a weak relationship between e-commerce and customer satisfaction. Furthermore, the results revealed a positive relationship between e-commerce and job performance. Simply put, employment of e-commerce technologies led to better job performance (Azeem et al., 2015).
The results of regression analysis demonstrated a significant association between e-commerce (B2B, B2C, and C2C) and organizational performance. This implies that the performance of banks in Pakistan was strongly influenced by the deployment of e-commerce technologies, that is, business to business, business to customer, and customer to customer (Azeem et al., 2015).
This study examined the effect of electronic advertising, electronic marketing, electronic payment systems, electronic customer support services, and electronic order and delivery on SMEs’ performance (that is, operational, market-based, and financial performance). Specifically, the study sought to establish whether e-commerce applications adopted by target SMEs have a positive and significant impact on the operational performance of the SMEs. Secondly, the study sought to determine whether e-commerce applications deployed by target SMEs have a positive and significant impact on the financial performance of the SMEs. Lastly, the study sought to find out whether e-commerce applications employed by target SMEs have a positive and significant impact on the market-based performance of the SMEs. The target population included 395 SMEs using e-commerce and operating in manufacturing and service sectors in the Pune region, India. Questionnaires were the main instruments for data collection. Demographic responses were analyzed using descriptive statistics (frequencies and percentages). A path analysis model was used to establish the relationship between the dependent and independent variables. The findings were presented in relevant tables as required (Jahanshahi et al., 2012).
The results demonstrated a positive and significant relationship between e-commerce applications and operational performance of SMEs in Pune, India. The findings also revealed that e-commerce applications had an insignificant and negative impact on the financial performance of the target SMEs. It was also shown that e-commerce applications have a positive and significant impact on the market-based performance of target SMEs. Lastly, the findings revealed that e-commerce applications had a positive and significant effect on organizational performance in target SMEs (Jahanshahi et al., 2012).
Citation
Arinaitwe, J. (2025). Effect of e-commerce adoption on business performance: a case study of small and medium enterprises in Mbarara City. Journal of Academic and Multidisciplinary Research, 4(2), 93-102.
Abdi, M.Y. (2018). The impact of e-commerce on organizational performance. A master’s thesis submitted to Daffodil International University, Dhaka, Bangladesh.
Almuwallad, H. and Alhumoudi, H. (2024). The impact of e-commerce on organizational and financial performance in SMEs: evidence from Saudi Arabia. International Journal of Business and Management, 19(4).
Azeem, M.M., Ozari, C., Marsap, A., Arhab, S., and Jilani, A.H. (2015). Impact of e-commerce on organization performance: evidence from the banking sector of Pakistan. International Research Journal of York University, 2(3).
Bhatti, A. and Rehman, S. (2019). E-commerce effect on organization performance with the moderating role of social media. International Journal of Business Management, 4(1), 1-8.
Hariandi, M.S.I., Gumanti, T.A., and Wahyudi, E. (2019). E-commerce, competitive advantage, and business performance of Banyuwangi small and medium-sized enterprises. International Journal of Scientific & Technology Research, 8(8).
Hurasha, C.I. and Chiremba, T. (2016). Influence of electronic commerce on business performance: evidence from e-commerce organizations in Harare, Zimbabwe. Journal of Economics and Behavioral Studies, 8(6), 146-152.
Ismael, A.D. and Lingtong, Z. (2020). E-commerce and business performance: an empirical investigation of business organizations in Nigeria. IJARIIE, 6(5).
Ismael, A.D. and Lingtong, Z. (2020). Impact of e-commerce adoption on the business performance of SMEs in Saudi Arabia. IJARIIE, 8(2).
Jahanshahi, A.A., Rezaei, M., Nawaser, K., Ranjbar, V., and Pitamber, B.K. (2012). Analyzing the effects of electronic commerce on organizational performance: evidence from small and medium enterprises. African Journal of Business Management, 6(15), 6486-6496.
Jovanovic, J.S., Vujadinovic, R., Mitreva, E., Fragassa, C., and Vujovic, A. (2020). The relationship between e-commerce and firm performance: the mediating role of Internet sales channels. Sustainability, 12.6993.
Lambe, I., Kayode, D.E., and Abalaka, E.D. (2021). Effect of electronic commerce on financial performance of listed food and beverage firms in Nigeria. Bingham University Journal of Accounting and Business (BUJAB), 7(1).
Sedighi, A. and Sirang, B. (2018). The effect of e-commerce on SME performance. International Journal of Applied Research in Management and Economics, 1(2), 71-81.
Setiawan, M.D., Adhariani, D., Harymawan, I., and Widodo, M. (2023). E-commerce and micro and small industries’ performance: the role of firm size as a moderator. Journal of Open Innovation: Technology, Market, and Complexity, 9.
Sormin, F. and Khomsiyah, (2021). The effect of e-commerce on MSME performance with environmental perspective as moderation. International Journal of Management Studies and Social Science Research, 3(5)
Sunayana; and Parveen, R. (2019). The impact of e-commerce on the organizational performance of the Indian travel agencies. Tourism in Function of Development of the Republic of Serbia, Tourism as a Generator of Employment (TISC 2019)—Thematic Proceedings I.
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