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There are concerns that despite government initiatives to promote adoption of electronic commerce, SMEs still fail to realise e‐commerce related benefits. It may therefore, seem premature to discuss electronic marketplaces in the context of SMEs. However, if SMEs ignore e‐marketplaces a number of problems can result. E‐marketplaces present a significant threat to SMEs since they increase competition and leave non‐participants vulnerable to more e‐enabled firms. This paper examines the barriers and benefits of e‐marketplace participation by SMEs. The nature of e‐marketplaces is addressed and the benefits of participation are examined. Drawing on the literature, the barriers facing smaller firms in this environment are discussed. Identification of these barriers, such as lack of standards, supply chain integration and global trading, enables a greater understanding of how SMEs can plan effective strategies to …