RealTime IT News

More Companies to Use Internet for Purchasing

The number of companies that plan to use the Internet for the majority of their buying is expected to double by year's end, according to an online survey conducted by Thomas Register and Visa U.S.A.

The survey queried approximately 2,000 corporate purchasing decision-makers representing companies in a variety of industries, including manufacturing, engineering, government, wholesale, and retail.

Nearly 21% of the respondents said they plan to make more than half of their purchases over the Internet by the end of the year. Currently, about 10 percent of these companies utilize the Internet for more than half of their purchases.

"That's a significant increase considering that we're only talking one year from now," said Julianne Garry, director of Internet marketing for Thomas Register. "While issues like security are still affecting the way companies look at the Internet as a viable medium, purchasing professionals appear optimistic that the issue will be resolved in the near future."

In fact, when asked why they weren't making purchases over the Internet, almost 70% of those who responded cited security as the reason. What's more, 45% of the respondents said they were "very concerned" about the level of security for purchasing over the Internet.

The telephone and fax are still the most preferred ways for companies to make more than half of their purchasing, receiving 60.2% and 26.3% of the votes, respectively. In general, the most popular payment method for business to business transactions is by check, which received 78.8% of the votes.

However, "The findings from this survey indicate that payment trends are changing, with online purchasing becoming increasingly important," said Ryan Ross, vice president of commercial commerce for Visa U.S.A. "As business-to- business volume grows on the Internet, so, too, will the use of purchasing cards and the SET Secure Electronic Transaction protocol for the benefit of buyers and suppliers."

Forty percent of the respondents said they use the Internet on a daily basis to make purchases, with the highest purchase being $10 million and the lowest being $13. However, the average monthly amount companies are spending over the Internet is less than $1,000.

Thomas Register on the Internet, published by Thomas Publishing Co., lists more than 155,000 companies, 60,000 product headings, 5,500 online catalogs, and over 1,000 Web sites.