Kitchen Stuff Plus founder Mark Halpern is one of several thousand Canadian SMBs who use high-tech utensils to keep their business cooking.

Fourteen years ago, Mark Halpern spent most weekends touting the latest in kitchenware at flea markets in and around Toronto. By his own estimation, his company, Kitchen Stuff, was "quite advanced" for a flea market operation, given the off-the-shelf point-of-sale (POS) software he ran on his PC to keep track of inventory. In his first year, he netted sales of $50,000.

Today, the 34-year-old entrepreneur presides over an empire of five stores rebranded as Kitchen Stuff Plus, employing 140 people and generating $14 million in sales in fiscal 2001. He plans to extend the firm´s reach in early 2003 by ramping up his Internet efforts, moving Kitchen Stuff Plus beyond a static web site to one that lives and breathes e-business. Once the BMI Enterprise Retail Solution, a Navision-based POS solution, is in place, the company´s suppliers will be able to monitor the movement of goods, employees can revise their work schedules and train on-line, and customers will be able to buy merchandise over the web and keep track of gift and bridal registry activity. The goal: greater exposure and, ultimately, even bigger sales.

Not bad for a small business without anybody exclusively dedicated to its growing information technology needs.

"We can´t have in-house, full-time people devoted to [I.T.] -- it´s just not economically feasible," Halpern says. Instead, he spends long hours perusing the media, walking the trade show floors, surfing the Internet and talking to colleagues, vendors and resellers to be sure he´s implementing the best hardware, software and services at prices that make sense for his growing and evolving business. He has just one helpmate: a Kitchen Stuff Plus employee who toggles between accounting duties and maintaining the network. Halpern estimates the two of them researched and evaluated close to 50 products and visited a slew of U.S.-based trade shows in their search for a POS solution that would e-enable their business.

Limited reach Halpern´s experience is all too common among small and mid-sized businesses (SMBs), which Toronto-based IDC Canada Ltd. says make up 99.8 per cent of all business in Canada. While SMBs are keen to learn as much as they can about technologies that will propel their businesses forward -- particularly e-business -- they´re often limited in resources, funds and knowledge to get the job done right, if at all.

According to a new IDC Canada study commissioned by Cisco Systems Canada, one of the SMB market´s major barriers to network infrastructure investment is a lack of perceived business value, a fact that quite surprised the Cisco team, says Cisco Canada´s marcom manager Willa Black. Microsoft Canada´s research indicates that 52 per cent of SMBs look to VARs for their software needs (the rest shop at computer retailers or buy through direct mail, catalogue shopping or the web). Consequently, the opportunities for resellers to show them the way are tremendous.

"Small and medium business typically look to their suppliers to give them the thought leadership around what they should be doing," says Vito Mabrucco, IDC Canada´s group vice-president of products and services research. He says VARs should be spending more time preaching the value of selling over the Internet, and helping customers set up "true" e-commerce sites. "That´s something that´s been missing." He also suggests that VARs continue to help small customers build out their infrastructure "to be sure that the performance is met."

That message ran loud and clear at a two-day seminar held last month at Toronto´s Centennial College. More than 200 SMBs gathered to hear from futurist Don Tapscott as well as a host of vendors and users discuss, and debate, how to bring e-business into their lives. Nancy Zowkewych, a professor with the college´s Centre for E-business and Network Technologies, recalls that participants were no longer asking about the whys of e-business but rather the hows of bringing it on board. Many were still making decisions based on cost, she says, and became frustrated trying to identifying the needs and uses of technology.

"People were saying, ´Who do I trust? How do I know who´s going to help me identify my specific needs?´" she recalls. Zowkewych says she heard "at least five times" that costs become secondary once the SMB owner or manager has properly identified his or her business needs: "They´re frustrated if they´re sold something that (a) they don´t know how to make work or exploit the functionality of, or (b) really doesn´t give them what they need."

Trust factor The customer-partner relationship, then, should be similar to the relationship an entrepreneur has with a lawyer or accountant: it all boils down to trust. "People who are more dependent on their computer supplier need to have that element of trust and the feeling that they understand the business process," Zowkewych says. That´s why those working the SMB market have to take on the role as educators, according to Rick Lawton, business development manager at Toronto-based EMC Canada. Large enterprises, he says, might spend five to seven per cent of their revenue on I.T., while mid-sized enterprises spend one to three per cent, so being able to put what they need in some sort of business context is what they´re looking for. "They don´t have the people internally on their own bench to assess it," Lawton says. "They expect that as a service ... it´s a consultative sell."

By all indications, the SMB market is quite lucrative. IBM Canada, for example, derives 40 per cent of its business from SMBs, while corporately, Big Blue describes the market as a US$100-billion opportunity worldwide. In fact, it anticipates spending about US$100 million on SMB worldwide marketing this year. According to IDC Canada, SMBs account for well over $12 billion in spending. A recent study by Toronto-based Evans Research Corp. reveals I.T. spending by SMBs is up from last year, with 48 per cent of the IT budget being spent on new hardware, 29 per cent on software, and 23 per cent on services.

But don´t be misled: even though SMBs have "small" or "medium" in their monikers, their needs appear to be anything but simple. John Macdonald, general manager of Toronto-based Navision Canada, says large enterprises tend to have straightforward business processes while mid-market businesses do a little bit of everything - they manufacture a product, sell it, service it, lease it, support it, and market it all under one roof. All this makes their business requirements even more complex than larger companies. "They need business solutions that have a broad range of functionality to handle all those different things and that are integrated s