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![]() E-commerce Overview Series:
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Sub-sector | Percentage of Web Sites | |||||
---|---|---|---|---|---|---|
CA | ON | QC | ||||
Beverage | 40% | 57% | 29% | |||
Cereal | 36% | 38% | 21% | |||
Snacks | 29% | 33% | 27% | |||
Dairy | 29% | 27% | 27% | |||
Sweets | 28% | 31% | 25% | |||
Canning | 26% | 34% | 20% | |||
Meat and Seafood | 26% | 34% | 20% | |||
Bakery | 9% | 11% | 8% |
Source: Scott's Business Directories, 2002.
Firms are regionally segmented in terms of e-business. All things being considered, in certain sub-sectors, Quebec firms have fewer Web sites than Ontario firms. This is true for the cereal (21% in Quebec compared with 38% in Ontario), beverage (29% versus 57%) and canning (20% versus 34%) sub-sectors.
The four principal business models or electronic solutions used by firms in the agri-food industry are: 1) E-malls, or virtual shopping centres aimed at broadening the scope of food processors; 2) Electronic or virtual stores that permit SMEs to promote their products; 3) Information brokers who are more often connected with agriculture production than food processing; and 4) Third party marketplaces are less prevalent in this industry. Diagram 2 provides a few examples of firms or Web sites that stand out in the agri-food industry. In Canada, SMEs in this sector are found mainly in quadrants one and two.
To fully understand Diagram 2, the reader should consult the document entitled "Electronic Business Models: A Conceptual Framework for Small- and Medium-sized Canadian Enterprises" at the following address: www.cefrio.qc.ca/english/pdf/Strategis%20_Eng.pdf. This document describes in detail the four main models illustrated in the above diagram.
E-business plays a key role in the distribution of products within Canada's agri-food industry. Firms in the sector need to pay close attention to this area of their operations.
Canadian agri-food SMEs need to overcome barriers primarily related to difficulties encountered in developing new markets. Even though electronic markets make it possible to reduce advertising and promotion costs, it remains difficult for SMEs to join certain distribution channels that are dominated by large buyers.
E-business opens up opportunities for specialty products marketed by agri-food SMEs, reduces the cost of entry into niche markets that compete with grocery markets, and constitutes a new information and distribution channel that offers SMEs an alternative to the grocers. Moreover, information technologies make it possible to reduce promotional costs.
Finally, grouping small food processing firms together in a region to form an e-mall (or virtual shopping centre) that is associated with one specialty and exports beyond the region, offers SMEs some very profitable opportunities.
Statistics Canada, 2000, Canadian Business Patterns (Beyond 20/20)
http://strategis.gc.ca
www.cefrio.qc.ca/english/indexAccueil.cfm
http://strategis.gc.ca/plastics
http://strategis.gc.ca/ebizenable
http://sourcecan.com
www.agr.gc.ca
This document has been prepared by CEFRIO, as part of the project "New E-business Models and SME Development", a project undertaken in cooperation with Industry Canada, the National Bank of Canada, TELUS, CANARIE and Canadian Heritage.
The research team included Mrs. Louise Côté and Mr. Michel Vézina from HEC Montréal, and Mr. Vincent Sabourin from the Université du Québec à Montréal.
For more information, please go to the CEFRIO Web site – the authority on information technology appropriation – at: www.cefrio.qc.ca/english/indexAccueil.cfm.
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Created: 2004-03-10 Updated: 2004-03-11 ![]() |
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