All I hear about these days is e-business. But I don't know if I need it. Should I consider it?

Sometimes it may seem that everybody but you is involved in e-business. Certainly there is enough noise about the subject out there to make every business stop and think about whether it should join the e-business brigade.

Many people confuse e-business with e-commerce, which is the sale of products or services over the internet, usually to consumers. An online clothing store would be an example of e-commerce but not necessarily of e-business. On the other hand, a business marketing its services to another business would be undertaking e-business but not e-commerce, since transactions do not take place online.

Most e-business today involves what is known as a "clicks and mortar" approach, which simply means that a business with a physical presence incorporates electronic communications into its daily operations. This could be as simple as setting up a site for marketing and informational purposes – known as an online brochure – or as complex as creating an online store that sells hundreds of products and raises logistical issues such as shipping.

However, many businesses exist online only. These virtual businesses find it more cost-effective to conduct business online than to invest in physical space, and they can reach more customers further away. These businesses are usually, at their core, knowledge businesses. Their primary product or service involves information or specific knowledge, which they then sell to others via the web. An example would be the "content business," which is really an online publishing operation that gathers information on a specific field (such as engineering) and sells it to a community of similar customers that it has gathered together.

With these distinctions in mind, it is important that every SME thoroughly examine itself to determine whether e-business is appropriate. In most cases, some aspect of e-business will be useful. But in some – perhaps a business operating in a very narrow field where mass communications is not important – it will add little value to the business operation.