Firm Size and the Adoption–Awareness Gap: Evidence from Micro, Small, and Medium Enterprises in Delhi NCR

Abstract

To increase market access for micro, small, and medium-sized companies (MSMEs), governments around the developing world have made significant investments in digital public-procurement platforms; yet, participation among the smallest businesses is still consistently low. This research investigates if business size affects the difference between an MSME's knowledge of a digital procurement platform and its actual usage of that platform. The study assesses awareness, adoption status, depth of platform usage, perceived barriers, attitude, and satisfaction with regard to India's Government e-Marketplace (GeM) using primary survey data gathered from 450 MSMEs operating throughout the Delhi National Capital Region (NCR), stratified equally across Micro, Small, and Medium categories. The findings indicate that both the raw adoption rate (22.0%, 52.0%, and 56.0%, respectively; χ² = 42.19, p <.001) and knowledge of GeM increase monotonically with company size (Micro M = 2.47, Small M = 3.19, Medium M = 3.44; p <.001). Crucially, even under the assumption of high knowledge, only 29.2% of Micro enterprises had embraced GeM, compared to 59.7% of Small and 70.1% of Medium firms (χ² = 12.81, p =.002). While the simple impact of awareness within micro companies was statistically insignificant, a logistic model adjusting for awareness indicated that company size maintains a high, independent influence on adoption (Small OR = 3.52; Medium OR = 3.74; both p <.001). Micro adopters reported much shallower usage (Adoption Extent M = 2.70 vs. 3.49 for Medium; p =.002) and were much more likely to stay in the exploratory stage of participation (45% vs. 17% for Medium; χ² = 15.55, p =.004), along with significantly higher perceived barriers. Together, these results show that the awareness-adoption gap among Indian MSMEs is a capability- and resource-execution issue that is concentrated among the smallest businesses rather than solely an information one. Implications for MSME policy, platform-adoption theory, and e-governance design are covered in the study.