Digital economy, as a new economic model after agriculture and industrial economy, is rising rapidly and gradually, becoming the main economic form of current society. This economic model is based on Internet information technology and regards big data as a core production factor. The digital economy contributes significantly to resource allocation optimization and the transformation of traditional sectors through precise identification and deep integration of data resources. In the meantime, small and medium-sized businesses, which are a significant component of the national economy, consistently hold a significant position in employment and technical innovation. The trend of small and medium-sized businesses going digital has become unavoidable in order to keep up with the growth of the digital economy. The purpose of this paper is to examine how the digital economy affects small and medium-sized businesses' digital transformations and to examine the relationship, present state, and difficulties between the two. The specific effects of the digital economy on the transformation of small and medium-sized businesses from the perspectives of production process, operation management, and product services, as well as the opportunities and difficulties posed by digital transformation, are then discussed in order to offer helpful resources and motivation for this process.
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