According to a report from the department for business, innovation and skills, two million small firms are missing out on business due to a lack of digital skills and online presence.
The research showed 39% of small businesses and sole traders are missing out by not having a website. 55% admitted they found it difficult to support small local firms if they have no online presence.
According to the research, more than half of customers visit search engines first when looking to buy from local businesses.
In the run up to Cyber Monday the government announced its plans to support small businesses and sole traders to increase their online presence.
A digital television channel will be launched in Manchester to provide business advice, and supported by events and networking sessions.
Business and enterprise minister Matthew Hancock believes thousands of potential customers are searching online for small local businesses and without an online profile he thinks they will lose out.
He said: "To make sure consumers get the best deal and small businesses spread their nets far and wide, the government is investing in expert advice to help them do more online.
"I am committed to making the UK the best place in the world to start up and grow, and this is integral to achieving that."
Return to internet news headlines
View Internet News Archive