The Federation of Small Businesses (FSB) also said that a voluntary code of practice should also be drawn up to ensure that broadband providers were delivering customers the internet speeds they had promised.
In a report published Thursday, the FSB said its members often complained about the reliability of speeds promised by internet service providers, although services were improving. It said that a universal service obligation (USO) would resolve the problem by setting a floor of 10 Mbps.
The report said that further investment in digital infrastructure was needed.
“Large numbers of small firms are using new digital technology to revolutionise the way they do business, but the market still has barriers stopping firms from seizing these opportunities,” said Mike Cherry, FSB policy director.
“The success of the digital revolution has led to ever higher expectations from businesses and consumers which at times the market struggles to deliver.”
The FSB found 99 per cent of small firms rated the internet as highly important to their business, with over half already offering services online and a further 15 per cent planning to do so.
Only 36 per cent of businesses knew that superfast broadband was available in their area, while some businesses said the cost of services was stopping them from taking up superfast broadband.
Businesses also complained about the length of time taken to repair faults and to install new services.
The previous government said that it would consider a universal service obligation as part of its long term promise to deliver ultrafast broadband to nearly all households. Ofcom, the telecoms regulator, has also said that it would consider this obligation.
The FSB said that a USO should be set at 10 Mbps, rather than 5 Mbps as has been suggested. A delivery plan for rolling out ultrafast broadband should also be drawn up, it added.
The UK has separately promised to provide superfast broadband of more than 15 Mbps to 95 per cent of the country by 2017 as part of its Broadband Delivery UK (BDUK) programme, which has been subsidising BT fibre infrastructure in difficult-to-reach areas.