Hosted Contact Center Featured Article

Home-Based Businesses Increasingly Looking to SaaS Solutions

March 23, 2009

By Susan J. Campbell,
TMCnet Contributing Editor

Home-based businesses are growing in the U.S. and so is the number of those businesses turning to software-as-a-service (SaaS (News - Alert)) solutions. In fact, the number of home-based businesses using such solutions nearly doubled in 2008, growing 92 percent to 2.3 million HBBs.



 
These figures are according to Access Markets International (AMI) Partners in its latest report, “2008-09: U.S. Home Based Business Market Overview - Impact of Economy: Changing Dynamics, Opportunities & Challenges."

When considering gross spending, HBBs contributed 16 percent of the total SaaS expenditures by U.S. small and mid-market enterprises for the period. The AMI survey explored how U.S. HBBs are moving to adopt a variety of SaaS applications, including accounting/finance, contact management, data storage/back-up and other application sets.

"Today's economic reality is driving businesses of all sizes to seek the most cost-effective and easy ways to use and manage IT solutions,” said Sau Lam in a Monday statement. Lam is a Senior Analyst with AMI-Partners

“This is especially true for HBBs that have bare-bones or no IT support. SaaS offerings fit the bill as HBBs look for solutions that are both appropriate to their needs and do not require significant upfront financial investment," said Lam. “Cost reduction is cited by HBBs in the U.S. as the number one driver for using SaaS followed by ease of installation and management."

SaaS vendors seeking to capitalize on opportunities in the marketplace will find a receptive market among younger HBBs. Those that have been in existence less than five years are more likely to turn to a SaaS solution.

In fact, 30 percent of HBBs between two and five years old and 13 percent of HBBs less than two years old are more likely to adopt SaaS than their more mature peers.

The research completed by AMI-Partners contributed to the overall report that highlights major trends in the context of current and planned IT, Internet and communications usage and spending. Products and services covered in this research include established and emerging hardware, software, applications and business process solutions.

The firm tracked a broad spectrum of issues that pertain to budgets, purchasing behaviors, decision influencers, channel preferences, outsourcing, service and support. The study also covered detailed firmographics and critically important technology attitudes and strategic planning priorities.

For those vendors operating in the SaaS space, close attention to the results of this study can help in designing strategies for growth. Even with our current economic woes, companies can still drive revenues and profits if they properly align their solutions where the need is greatest.

Susan J. Campbell is a contributing editor for TMCnet and has also written for eastbiz.com. To read more of Susan’s articles, please visit her columnist page.

Edited by Stefania Viscusi