  This paper presents the preliminary findings of a study researching the
diffusion and the adoption of online retailing in Saudi Arabia. It reports new
research that identifies and explores the key issues that positively and
negatively influence retailers in Saudi Arabia regarding the adoption of
electronic commerce. Retailers in Saudi Arabia have been reserved in their
adoption of electronically delivered aspects of their business. Despite the
fact that Saudi Arabia has the largest and fastest growth of ICT marketplaces
in the Arab region, ecommerce activities are not progressing at the same speed.
Only a tiny number of Saudi commercial organizations, mostly medium and large
companies from the manufacturing sector, are involved in e-commerce
implementation. Based on qualitative data, collected by conducting interviews
with a sample population of retail sector decision makers in Saudi Arabia, both
positive and negative issues influencing retailer adoption of electronic
retailing systems in Saudi Arabia are identified. A number of impediments which
include cultural, business and technical issues were reported. Facilitating
factors include access to educational programs and awareness building of
e-commerce, government support and assistance for ecommerce, trustworthy and
secure online payment options, developing strong ICT infrastructure, and
provision of sample e-commerce software to trial. While literature reveals that
government promotion has had limited effects on the diffusion of e-commerce in
most countries, this study significantly indicates government promotion and
support as a key driver to online retailing in KSA.
