This project aims to find out the factors affecting electronic commerce readiness of small and medium firms exporting electronic services. Fifty nine SMEs firms, which were exporting electronic services, were surveyed during the Electronic Services Fair last February 2002 on the factors affecting their electronic commerce readiness state. Based on the sample size studied, IT capability was the number one factor that motivated firms to be electronic commerce ready. Other factors which motivated firms to be electronic commerce ready were the number of years of involvement in the electronic marketplace and efforts to learn electronic commerce through seminars and training programs. The chi-square tests showed no significant differences in the electronic commerce readiness states when firms were grouped according to the total company assets based on capitalization, number of years in the export business and the average age of all firm employees.