Impact of SMEs and Infrastructure on Economic Growth

The assignment delves into the significance of SMEs in Pakistan's economy, analyzing their role in economic and socio-economic development. It also examines the impact of infrastructure on economic growth, highlighting the importance of proactive entrepreneurs who leverage opportunities to drive success. The document provides a critical analysis of the merger and acquisition (M&A) landscape in Pakistan, as well as case studies on entrepreneurship and economic development in various contexts.

Assessment Submission & Declaration
Qualification Unit number and title
Pearson BTEC Higher National Diploma in Business
(rqf)
09. Entrepreneurship & Small Business
Management (level 4)
Student name Assessor name
Minahil Sajid Xxx Yyy Zzz
Date issued Completion date Submitted on
Monday, 13th January 2020 Thursday, 30th April 2020 30/4/20
Assignment Title Entrepreneurial Venture & The Entrepreneurial Mindset
Assessment Criteria Task Number Evidence Page Number
Pass 1 Task 1
Pass 2 Task 1
Pass 3 Task 3
Pass 4 Task 3
Pass 5 Task 2
Pass 6 Task 2
Pass 7 Task 2
Merit 1 Task 1
Merit 2 Task 3
Merit 3 Task 2
Merit 4 Task 2
Distinction 1 Task 1
Distinction 2 Task 3
Distinction 3 Task 2
Distinction 4 Task 2
Plagiarism
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students who break the rules, however innocently, may be penalised. It is your
responsibility to ensure that you understand correct referencing practices. As a university
level student, you are expected to use appropriate references throughout and keep carefully
detailed notes of all your sources of materials for material you have used in your work,
including any material downloaded from the Internet.
Learner Declaration
I certify that the assignment submission is entirely my own work and I fully understand the
consequences of plagiarism. I understand that making a false declaration is a form of malpractice.
Student Signature: Minahil Sajid Date: 30.2.20

Table of contents
Introduction:........................................................................................................................................... 3
LO1 Explore and illustrate the range of venture types that might be considered ..................................4
P1 Examine different types of entrepreneurial ventures and explain how they relate to the typology of
entrepreneurship....................................................................................................................................4
Business Venture:....................................................................................................................................4
Types of business ventures:.....................................................................................................................4
Small Business:........................................................................................................................................4
Social Good Organizations/Businesses:...................................................................................................4
Large business:........................................................................................................................................5
Scalable start-up (innovation-led or high growth tech company):..........................................................5
Business ventures of choice:...................................................................................................................5
P2 Explore the similarities and differences between entrepreneurial ventures......................................5
similarities and differences between entrepreneurial ventures..............................................................5
M1 Investigate a diverse range of entrepreneurial ventures to demonstrate an understanding of
entrepreneurship in both the public and corporate sector. private sector:............................................7
public sector:...........................................................................................................................................7
D1 Critically examine the scope, development and growth of entrepreneurial ventures.......................8
scope, development and growth of entrepreneurial ventures................................................................8
P4 Explain the importance of small businesses and business start-ups to the growth of the social
economy................................................................................................................................................13
M2 Evaluate the differences small, medium and large businesses make to the economy, applying
relevant data and statistics....................................................................................................................14
SME:...................................................................................................................................................... 14
LO3 Determine and assess the key aspects of an entrepreneurial mindset..........................................16
P5 Determine the characteristic traits and skills of successful entrepreneurs that differentiate them
from other business managers..............................................................................................................16
Vision:....................................................................................................................................................16
Flexibility:..............................................................................................................................................16
Passion:................................................................................................................................................. 16
Risk Taker:.............................................................................................................................................16
Strong Work Ethic:.................................................................................................................................17
A good entrepreneur has strong work ethics. They often follow being punctual, being the first to
arrive and last to leave. They would know check in even on off days making sure everything is coming
together and that results live up to their expectations. They make sure to set a good solid example for
all their employees to follow.................................................................................................................17
Team Work:...........................................................................................................................................17
Resilience:............................................................................................................................................. 17
P6 Assess how aspects of the entrepreneurial personality reflect entrepreneurial motivation and
mindset................................................................................................................................................. 17
M3 Explore and examine different lines of argument relating to entrepreneurial characteristics........18
There is an association between entrepreneurial tendencies and personality traits of individuals. In
some cases personality traits serve as a hinder for some people. Sometimes individual fortunate
enough to posses both while other times they’re not...........................................................................18
D3 Analyzing the characteristic skills, traits and motivational drivers of at least two successful
entrepreneurs with examples:..............................................................................................................20
LO4 Examine the different environments that foster or hinder entrepreneurship...............................21
P7 Examine, using relevant examples, how background and experience can hinder or foster
entrepreneurship..................................................................................................................................21
D4 Critically analyse how background and experience influences entrepreneurs, both positively and
negatively, by comparing and contrasting examples.............................................................................22
Conclusion:............................................................................................................................................23
REFERENCES:.........................................................................................................................................24

Introduction:
Entrepreneurship is taking an idea, processing it and then launching while executing it while
acknowledging its financial and managerial risks. An individual that takes these risks and
setting a business for financial gains are known as entrepreneurs. There are various types of
business ventures and entrepreneurs require having specific skills and traits that help them
run a business empire. Experience and personal background affect entrepreneurship in
multiple ways that can encourage or obstruct a business. The assignment would allow us to
focus various types of business ventures and research on the effect they have on economy,
as well as the abilities and
mindset required to set up a business dealt with in detail linking them back to the ways in
which experience and personal background influence a start-up business.
LO1 Explore and illustrate the range of venture types that might be considered entrepreneurial
P1 Examine different types of entrepreneurial ventures and explain how they relate to the
typology of entrepreneurship.
Business Venture:
It’s a set up formed with the intention of gaining financial gains.Often individuals or multiple
parties invest in these venture with prospect of the business delivering to them financial
gains.
Types of business ventures:
Small Business:
A enterprise that is owned independently by an individual or partnership and for the fake of
gaining financial profit. It is often not dominant in its field. It aims at emerging into an
abiding business that is commercially successful as well as sustainable, with a possible pass-
on to a family member or sale to a worker. Their aim at success is limited to being able to
provide for their family and make a reasonable profit, not to rule the market. It is often
funded via micro-loans; bank loans; revenue; friends, family and personal funds. Small
businesses are not run by too many employees but are capable of generating payroll taxes
and jobs. They supply goods and services that are vital elements of a city’s infrastructure, as
well as leisure goods and retail.(Drucker, 2014)
Its examples include, cafes; retail stores; construction firms; agriculture
Lifestyle business (includes micro-enterprises and freelancers):
A business set up that is operated by its founders with the objective of earning a certain
level of income and nothing in excess or for them to just earn enough from the set up to
sustain and enjoy a certain lifestyle. These set ups are mainly based off of the founder’s
skills, strengths and passions. The aim of these businesses is to gain them earnings that
would last them just long enough. They aspire to gain this using self-direction along with
their passion and skills. It often doesn’t require any external funds, little to no amount of
money is needed to set up this type of business. Eventhough these form of enterprises
aren’t big job creators or don’t produce too much of revenue they are able to provide
income to their founders as well as provide for services and goods that improve quality of
life.
The type of businesses it includes are self-employed individuals; one-person firms; very small
operations, etc.
Social Good Organizations/Businesses:
A business that revolves around coming with with innovative ideas to resolve social issues
and promote causes that would bring about betterment in the environment as well as
society. Its aim is to work for various social causes for the sake of society, to make the world

a better place to live in, their objective is to provide social work and no financial gains. It
aspires to maximize influence in a durable long-lasting manner. Depending what the type of
the company type and how big or small it is, it can run the entire capital continuum. As an
outcome, these organizations have the prospective of generating a huge social impact and
improve lives (Scarborough, 2016)
Examples of social organizations would be, an organization aiming to resolve global human
rights issues; a company tackling particular issues in developing countries; nonprofits with a
philanthropic mission.
Large business:
These are established organizations with about 500 employees of more. Their aim is to
generate as much profits and revenue as they can for their share owners as well as to
expand their and raise there value and position in the market place as much as possible,
locally and globally. Their capital providers include profits gained ta credits, subsidiary ,
stock, etc. They are often associated with a brand image and a brand name with a certain
kind of image among its customers. They have life cycles restricted to a certain time period
and so many of these brands/ companies maintain their name and image as extend their life
cycle introducing various new ideas in the for of products or services this can range from
introducing unique feature in a product to offering new products that are variants around
their other core products. They strive to keep up to date with the changing trends and
customer demands, newer technologies, legislation, new competitors, etc.
Types of large businesses include corporations such as, KFC, Mcdonalds, Nishat, NLC, P&G,
Unilever etc)
Scalable start-up (innovation-led or high growth tech company):
Is a business that takes a fresh new idea, looking for a expandable and repeatable business
model that has high chances of progressing into a high growth, profit making organization.
Its aim to make the company huge making it possible by joining into a large market and
buying, while carrying away shares from the existing shareholders or by generating a new
market and helping it grow rapidly. Its capital providers include risk capital (accelerators,
venture capital, angel investment); non-dilutive capital (government grants, sbir/sttr);
friends, family and personal funds. Their outcome is their potential of taking a business and
ensuring its growth and success globally, turning them into huge profit/ revenue generation
organizations while creating jobs and a massive financial impact.
Types of scalable businesses include an organization manufacturing medical instruments or
developing life-saving vaccines; it companies developing b2b software or apps; clean tech-
geared firms
Business ventures of choice:
The business ventures i have chosen represent 4 various type of business ventures.
McDonald’s representing a large business venture with over 500 employees, TRP, a local
catering/food business representing a small business venture, Syrian Shawarma a shawarma
stall run by an individual classified as a lifestyle business venture and lastly Ehsas Sylani
Langar ruling under a social entrepreneurship venture.
P2 Explore the similarities and differences between entrepreneurial ventures.
Factors Small business
ENTREPRENEURSHIP
Scalable START-UP
ENTREPRENEURSHI
P
Large company
entrepreneurship
Social
entrepreneurship
Lifestyle Business
Entrepreneurship

aims &
objectives
These
Business may not
have organized
objectives and
aims at achieving just
enough
gains and
growth to provide to
their families
These organizations
focus on producing
new
products
Persistently and
ATTAIN high
profitability for
investors
These
companies focus
on surviving in the
market by
continuing to
introduce new
goods or
services and
marketing
schemes.
Their objective is
to tackle various
social issues to
make the world a
better place
THEY AIM AT
EARNING A
CERTAIN LEVEL OF
INCOME AND
NOTHING IN
EXCESS FOR THEM
TO JUST EARN
ENOUGH FROM
THE SET UP TO
SUSTAIN AND
ENJOY A CERTAIN
LIFESTYLE USING
THEIR SKILLS AND
PASSION
Risks The risks are not that
high but
competition is
especially with
companies
of same size.
The risks are high
because of the
huge money
investments
and the
responsibility of
returning huge
gained revenues to
the
shareholders by
achieving maximum
sales.
The risks are
medium since
they mostly
manage to
make large sales
in their brand
name
The risks are not
very high
due to the
business usually
receiving support
from
government or
the locals that
support their
vision
the risks are not
too high since the
business sustains
on the founder’s
own skills and so
doesn’t require alot
of investments
Employee
number
50 or less varied by the
company’s
structure and size.
1000 or more varied by the size
of the
business.
sole employee
Structure No definite
organizational
structure and
mostly operates as a
sole trader or with a
very few partners
Primarily
corporations or
limited
partnerships.
often
intricate and can
either be public
limited
or private limited
organization
Primarily
supported by
trustees
Sole partnership
Capital
Providers
Micro-loans; bank
loans; revenue;
friends, family and
personal funds
Risk capital
(accelerators,
venture capital,
angel investment);
non-dilutive capital
(government
grants, SBIR/STTR);
friends, family and
personal funds
Revenue; tax
credits;
subsidiaries, Stocks
DEPENDING
WHAT THE TYPE
OF THE
COMPANY TYPE
AND HOW BIG OR
SMALL IT IS, IT
CAN RUN THE
ENTIRE CAPITAL
CONTINUUM
EVENTHOUGH
THESE FORM OF
ENTERPRISES
AREN’T BIG JOB
CREATORS OR
DON’T PRODUCE
TOO MUCH OF
REVENUE THEY ARE
ABLE TO PROVIDE
INCOME TO THEIR
FOUNDERS AS
WELL AS PROVIDE
FOR SERVICES AND
GOODS THAT
IMPROVE QUALITY

OF LIFE.
Outcomes SMALL BUSINESSES
ARE NOT RUN BY
TOO MANY
EMPLOYEES BUT ARE
CAPABLE OF
GENERATING
PAYROLL TAXES AND
JOBS. THEY SUPPLY
GOODS AND
SERVICES THAT ARE
VITAL ELEMENTS OF
A CITY’S
INFRASTRUCTURE,
AS WELL AS LEISURE
GOODS AND RETAIL.
THEIR POTENTIAL
OF TAKING A
BUSINESS AND
ENSURING ITS
GROWTH AND
SUCCESS
GLOBALLY,
TURNING THEM
INTO HUGE
PROFIT/ REVENUE
GENERATION
ORGANIZATIONS
WHILE CREATING
JOBS AND A
MASSIVE
FINANCIAL IMPACT.
.
AN IMPORTANT
ENMPLOYEER AND
ARE OFTEN
ASSOCIATED WITH
A BRAND IMAGE
AND A BRAND
NAME WITH A
CERTAIN KIND OF
IMAGE AMONG ITS
CUSTOMERS.
THESE
ORGANIZATIONS
HAVE THE
PROSPECTIVE OF
GENERATING A
HUGE SOCIAL
IMPACT AND
IMPROVE LIVES
EVENTHOUGH
THESE FORM OF
ENTERPRISES
AREN’T BIG JOB
CREATORS OR
DON’T PRODUCE
TOO MUCH OF
REVENUE THEY ARE
ABLE TO PROVIDE
INCOME TO THEIR
FOUNDERS AS
WELL AS PROVIDE
FOR SERVICES AND
GOODS THAT
IMPROVE QUALITY
OF LIFE.
.
size SMALL LARGE LARGE CAN VARY
BETWEEN
MEDIUM TO
LARGE
SMALL
M1 Investigate a diverse range of entrepreneurial ventures to demonstrate an understanding
of entrepreneurship in both the public and corporate sector.
private sector:
It’s the share of the economy which are operated by either sole proprietor or various
organizations to generate revenue and in not controlled by the government. Hence it
includes all for-profit businesses that are neither owned nor operated by the government.
public sector:
Businesses in this sector are owned and run by the government. The focus of these
companies is not to generate profits, instead it’s mostly focused on social welfare and
development.
McDonald’s is form of a large venture company the runs privately, the organizations aims to
focus on producing new products persistently to keep customers interested leading to
higher purchases earn the company high revenues. However TRP is a local private
catering/food business representing a small business venture. It differentiate from the other
types of companies since it doesn't have any organized objectives per say since its only
purpose is to be able to earn just enough money and achieve just enough growth for it
employers and employees to be able to feed and sustain their families . Syrian Shawarma a
private shawarma stall run by an individual is classified as a lifestyle business. It differs in its
aims from the other 3 companies since it aims to earn a just a sufficient amount of money
nothing more or less, it just aims to earn enough money to be able to maintain a certain
lifestyle putting their skills to good use. Lastly Ehsas Sylani Langar is a public social welfare
business. The aims of this business differ from the rest because its objective is to tackle a

social issues to make the world a better place. The social cause is feeding all sorts of under
privileged people making sure as many as possible stomachs are fed, it’s a cause working
toward ending world hunger.
The risks at McDonald’s are high since being an organization that operates and is famous
worldwide, there have been huge amounts of money investments made in the name of the
brand which put great pressure on it to earn back revenues just as remarkable by achieving
maximum sales possible for stakeholders. As for TRP the difference is that its risks are not
that high since its a small setup and not alot of money has been put into in however, its
competition is pretty high especially in the same size ventures. For Syrian Shawarma, the
risks are not very too high either since its a business earned by a single individual and very
little capital has been used to set it up and since the business sustains on founder’s own
skills. The risk rates at Ehsas Sylani Langer are very low aswell, since its it basically backed up
by the governmetn and other locals that support the business’s vision.
McDonald’s had over a 1000 employees all over the world, working very hard for the
company.Employees at TRP, however are lesser than 50, all very hardworking regardless.
Between 150-200 employees work for the Ehsaas Sylani Langer where as for Syrian
Shawarma, its it run by a sole employee, the owner himself.
The capital is McDonald’s comes though revenue generation, tax credits, subsidiaries, stocks,
which mean the organization gains capital anytime its shares are bought. TRP, gains its
capital through micro-loans; bank loans; revenues earned; money lent or invested by
friends, family and personal funds that the owner pay out of their pocket. As for Syrian
Shawarma, eventhough the venture is not a big job creator and don’t produce too much of
revenue, it is still able to provide capital just sufficient enough to be able to afford products
and services that improve quality of life. In comparison to all these organizations Ehsaas
Sylani Langer gains its capital from all over the nation and well are the government and
other donation from worldwide.
McDonald’s outcome is that it has potential to guarantee the growth of the organization and
well as its increasing success worldwide, turning it into a huge profit/ revenue generating
asset.It also creates job opportunities for unemployed people and draws a massive financial
impact. TRP is not run by too many employees but are is capable of producing enough
revenues to generate payroll taxes and job opportunities. It supplies services which is a vital
element of city’s infrastructure as well as retail. Syrian Shawarma Isn’t a big job creators and
doesn’t produce too much of a revenue either, however, it is capable of generating just
enough to enjoy a certain lifestyle. The outcome expected of Ehsaas Sylani Langer is for it to
have the prospective of generating a huge social impact and improve lives.
D1 Critically examine the scope, development and growth of entrepreneurial ventures.
scope, development and growth of entrepreneurial ventures.
Pakistan is experiencing a rise in start-ups in nearly every big city. Their success rate,
however is significantly low ranging between 10% and 20%, globally and locally (hyder,
shabir & lussier, robert.2016). Only close to 5/300 start-ups that are set up in Pakistan
annually survive in the medium term. This rate of success is lesser than 2%
Study suggests that in Pakistan, most start-ups are launched by people who are over the age
of 30 and have a professional background.the founder of 80% of digital start ups have
professional work experience. Market experts concluded that majority founders don’t have
enough skills to manage business or the mindset of an entrepreneur while 50% of the start-
ups only have it engineers in its founding team.
Only 300 digital start-ups set up annually are promising. Out of those, 10% receive
investments from friends and family or investors while about 3% more seek international
funds. Out of the 15 locally funded start-ups that rest in the country, only 5% establish

enough to sustain
21% of start-ups that were launched since 2013 categorize under e-commerce and delivery
services followed by software development, 15%, marketplace ,13%, e-learning 9%
communication platforms 9% and content based start-ups 8%.
The following a few reasons for the failure of start-ups Pakistan low investment in new
A key reason to the failure is not having enough capital. Founder lack investment skill where
as legislation doesn't support local businesses either.
The is a lack of digital innovation. Most people don’t know how to sell their business, they
make poor use of resources such as the digital market
There is a lack business and global knowledge among most self proclaimed entrepreneurs
digital entrepreneurs complain that their institute does not provide them with skills and
knowledge to help them survive in practical world. They have no proper resource of being
mentored or taught practical dealing.
People willing to begin start up are unable to find suitable investors, they are either unable
to to sell their pith to potential investor or they simply cant find any.
Most of the times people plan of starting a start up with little to no business knowledge,
they have no skills what so ever to run a business and having a good idea is not enough.
Hence so much failure is caused when setting up a new business.
The scope for start ups in Pakistan is to include new innovative ideas in market and provide
the public with goods and services. It is to carry the entrepreneurial mindset and take it
forward, to create job opportunities for employees and for the sake of revenue generation.
The development and growth of it is still weak there aren't enough resources to stabilize the
business, there is a lack of investors as well due to two reason, 1 most people fail to utilize
resources to sell their idea and 2 they genuinely cant find anyone who is willing to lend then
money. People are not skilled enough to run and sustain a business, they are not well
equipped enough to have the knowledge of how to mange and run a business they rely on
the little information taught in their institutes which they don’t find sufficient enough for
them to help them in practical world. There is not growth in these start ups either, their
failure rate is extremely high, and their survival chances and super low.
Start-up business can only be aided with the right finances and having the right knowledge
of knowing how to work an organization,potential entrepreneurs need to work on their
potential and polish their skills and learn how to act and perform like and entrepreneur and
handle a business, before they enter the market. They need to learn to use resources such a
digital marketing to their benefit to invite and gain investor, only then perhaps these
statistics would change
Small to medium companies account for 99% of over 3.2 million businesses in Pakistan and
have 35% sharre in addition to value; They have the prospect of contributing to the GDA a
share of about $86 billion. The companies add 30 % of value added to GDP. (Dr Shah, Syed,
A., 2018)
In can be said that life-style business are very successful in Pakistan. The country is about
$0.5 billion soley from freelancing while being declaired the 4th most popular country for
freelancing. (Digiskills. 2019) In addition to being ranked 4th on the list of growing freelance
market, Pakistan manages to rank above countries such as India, Bangladesh. The research
was done using 300,000 pakistani freelancers, a majority of these subject were also known
to be young adults (Digital Technologist. 2020)
While continuting to tackle multiple social issues, Pakistan has managed to rank South Asian
as one of the best performers in the second global poll on social entrepreneurs.
Pakistan was found to be one of the 3 countries, caused for an entire ranking to improve the
most since the first Thomson Reuters Foundation experts' poll on the best countries for
social entrepreneurs in 2016. It moved up 18 places to rank 14th among the world's 45
biggest economies, seen as a nation where social entrepreneurs would be able to make

earnings and attract great employees (Business Recorder. 2020).
Pakistan is the hub for one of the world’s largest textile industries. These organizations are
considered to be large enterprises, they export textiles to foreign. Nishaat group is another
example of a huge coorporation that runs in the country while running multiple operations
, they are the largest employeers in tprivate sector with about 60,000 employees. It has a
networth of $2.5 billion.McDonalds is another Example of a multinational running in
Pakistan and is extremely successful. It has been running here for years and yet it has
maintained its place in the market.
LO2 Assess the impact of small businesses on the economy
P3 Interpret and assess relevant data and statistics to illustrate how micro and small
businesses impact on the economy.
micro and small businesses and their impact on the economy.
The micro and small business in each industry, dominates in a large fraction and bring a
significant amount of contribution to the country’s economy. The number of these
organizations that produce huge amount of revenues is growing rapidly and they manage to
achieve this by the innovation of various products and services for it consumers.
Small businesses contribute to the economy by providing job openings to those who larger
organizations might not be willing to hire. They’re likely to lure fresh set of skill in their
company that introduces them to various new innovations. Since large organizations rely on
small businesses to fulfill their different organizational functions via outsourcing, hence they
benefit from them.
They are able to react upon and adjust to changing financial conditions fairly quick. Since
usually they’re built around customer care/needs and have a great understanding of the
community’s requirements. Most of the time consumers maintain their loyalty to these
businesses even during economic crisis which means they’re mostly able fight-through and
sustain themselves during difficult times. This allows for local economies to further
strengthen .
Consumers supporting small businesses means alot of revenue is being earned. Hence, the
business would deliver higher taxes, inclusive of general property taxes which would
contribute to the local economy
The following figures support my reasoning for all the point mentioned above as to how a
small business benefits the economy:

figure: Small business owners in the Asia-Pacific feeling optimistic: survey source:(
INTHEBLACK.2020)
The figure above displays the success and growth of small businesses in various countries.
2017 was displays more positive outcomes than those in 2016, stated that a fair number of
businesses grew. The most solid growing rates, were displayed by Indonesia and Vietnam
Vietnam and Indonesia have the highest faith in their local economy with New Zealand and
Australia having weak confidence . Overall the figure states the success and contribution to
the economy of small businesses.
The figure above illustrates how small businesses are the most dominant type of venture for
almost 99% firms. They are huge job providers, accounting for, on average for nearly 70%
employment, while being leading contributors to value creation, yielding between 50%-60%
of value added on average (Figure 1) (OECD, 2016b). Small businesses add up to 45% of
overall recruitment and 33% of GDP in rising economies. While considering the addition of
informal businesses into account, Small businesses add to over half of employment and GDP
in majority countries regardless of income levels (IFC, 2010). Small businesses and their
growth can add to economic changes and resilience which is super significant for countries
that are have alot of resource and that are specifically vulnerable to commodity price
fluctuations (OECD. 2017)
Small businesses and their locations vary greatly all over various countries and sectors, with
implications for their potential to enter and contribute to an open and digital economy.
Micro-organizations lead the business landscape, worldwide accounting for 70%-95% of

different firms. However, important cross-country differences are determined in the
addition of micro-enterprises to employment and value added. For example, their part in
employment in the services sector, ranges from over 60% in Greece to 20% in Denmark and
Germany, with their share in value contributed ranging from almost 45% in Luxembourg to
15% in Switzerland (oecd, 2016b). How small businesses perform varies across sectors too.
In services, they account for 60% or more of overall employment and value added in almost
all countries. Where as, in manufacturing, eventhough they are comparatively lesser in
numbers, large organizations supply an inordinate addition to employment and value added,
in huge fraction increasing returns to scale from more capital-intensive production, as well
as entry barriers related to investment. Germany and Mexico, are a few countries where
huge manufacturing groups acquire a great amount of share of total employment and value
added. Nevertheless, for some exclusions,such as in the figure shown above,involve smaller
economies, such as Latvia and Estonia, as well as bigger economies where they have
customarily ruled and lead manufacturing activities, such as Italy (oecd, 2017c).
Figure - Number of enterprises, GVA, persons employed (FTE), SME share, and percentage
share of dependent enterprises in SME category in four special aggregates, 2012. Source:
(Eurostat, 2015)

Figure - Number of enterprises, persons employed and gross value added (GVA) and the
share of SMEs, 2012. Source: (Eurostat, 2015)
All these figures above prove with their facts and figures the ways in which micro and small
organizations help improve the economy not just locally but globally.
P4 Explain the importance of small businesses and business start-ups to the growth of the
social economy.
small businesses and business start-ups and their importance in the growth of economy
Although small businesses and start-ups do not have an impact as huge as other larger
organizations, they still contribute significantly to social economy. Small business and start-
ups in each industry, dominates in a large fraction and bring a significant amount of
contribution to the country’s economy. Despite being small in size they are larger in number
than any other form of business venture and so eventhough this means that individually
their revenues earned are not as much, but combined they capable of generating huge
revenue contributions for the economy locally as well as worldwide
Having the ability to capture market quickly, they are able to produce huge amounts of
revenues in a very less times, they often manage to achieve this by the innovation of various
products and services for its consumers.
Start-ups and Small businesses contribute to the social economy by providing job openings
to employees that larger organizations might not be willing to hire. There are alot of start-
ups that are unable to give workers high salaries because of them lacking capital and those
recruit workers with a fewer skills on lesser salaries which is additionally a help in
diminishing unemployment issues.
Large organizations generate heavy revenues using smaller businesses as they rely on them
to fulfill their different organizational functions via outsourcing, hence they benefit from
them eventually helping social economy.
Start-up and small-businesses are able to react upon and adjust to changing financial
conditions fairly quick. Since usually they’re built around customer care/needs and have a
great understanding of the community’s requirements. Most of the time, consumers
maintain their loyalty to these businesses even during economic crisis which means they’re
mostly able fight-through and sustain themselves during difficult times. This allows for local
economies to further strengthen . Consumers supporting small businesses means alot of
revenue is being earned. Hence, the business would deliver higher taxes, inclusive of general
property taxes which would contribute to the local economy.
To add value to their brand, multiple start-ups and small businesses, , are linked to various
kinds of Corporate Social Responsibility activities that are regarding social, environmental
and economy issues. This allows for them to educate the rural population in rural areas or
those with an unfortunate financial background, who can make use of those learnings to get
employed, in the future, which too contributes to economic growth.
They contribute in bringing about improvement within the country as well as locally
because they help increase the manufacturing in rural areas by fixing them with the more
organized sectors. It transforms raw materials and then gives them away to bigger
organizations that have the money, skill and equipment, to manufacture these into
completed products.They massively help the growth of export revenues due work intensive
nature of good that cost very little. SMEs have promote the trade balance because they’re
usually use indigenous resources which helps cut back relying on imported machinery,

technology and raw material.
These organizations are placed rightly to fulfill customer demands in local, markets of the
country while they spread all through the country manufacturing various goods at lesser
prices. They satisfy consumers with their products more than branded products that are
produced by multinational organizations, etc. They allow for an opportunity to be provided
to rural women for them to produce earnings and aid their personal growth allowing them
to work at home. This assists to succeed in the just and impartial distribution of money by
creating non- discriminatory job opportunities country wide. These companies help adapting
a self assistance and entrepreneurial culture by bringing using skills to gain finances via
different lending and skill improvement schemes. SMEs draw in foreign investors form large
organizations that outsource from countries with powerful SME sectors. The low labour
costs allow very affordable manufacturing of semi-finished good for large organization
operating in international markets.
All the above mentioned examples are prove how important the contributions of small
businesses and start-ups are, for the increase of social economy, local economy as well as
economy worldwide.
M2 Evaluate the differences small, medium and large businesses make to the economy,
applying relevant data and statistics.
SME:
a term used to refer to small to medium organizations.These refer to non-subordinate,
independent organizations that are run a very small workforce. This figure varies in different
countries. The most commonly used 250 maximum employees, as in the European Union.
While a few others conclude the limit at 200 workers. However in the United States
companies with a workforce lesser that 500 is considered the limit.
Small businesses usually are those with 50 or less workers, whereas micro businesses have a
maximum of 5-10 employees (OECD Statistics Directorate. 2020)
Differences of small, medium and large businesses make to the economy,
SME organizations do not have an impact as huge as other larger organizations, however
they still contribute significantly to social economy. Usually first world countries run about
90% of their organization in the SME fragment which is one of the key additions to reasons
to financial development (Zafar, Ammad & Mustafa, Sadaf.2017)
The economic survey (2005) of Pakistan states that over 30% of the country’ exports are
dependent on the productions by SMEs. Close to 3.2 million employees are involved with a
SMEs. These organizations have become huge contributors to job employment in Pakistan
while contributing to a vital part of economic and socioeconomic advancement of Pakistan.
(Zafar, Ammad & Mustafa, Sadaf.2017)
SME organizations in Pakistan are fulfilling a vital role developing the economy and
succession of technical advancement, providing to large organizations in the industrial sector
and encouraging economic reclamation and social improvement (Anwar Ali Shah G. Syed.,
Muhammad Muneer Ahmadani., Naveed Shaikh and Faiz Muhammad Shaikh. 2012)
Being labour intensive small businesses contribute to the economy by providing job
openings to those who larger organizations might not be willing to hire. These firms hire
employees workers at a lower salary because they don’t make as much revenue such as
those made in a large organization. They contribute in bringing about improvement within
the country as well as locally because they help increase the manufacturing in rural areas by
fixing them with the more organized sectors. It transforms raw materials and then gives
them away to bigger organizations that have the money, skill and equipment, to
manufacture these into completed products.They massively help the growth of export
revenues due work intensive nature of good that cost very little. SMEs have promote the

trade balance because they’re usually use indigenous resources which helps cut back relying
on imported machinery, technology and raw material.
These organizations are placed rightly to fulfill customer demands in local, markets of the
country while they spread all through the country manufacturing various goods at lesser
prices. They satisfy consumers with their products more than branded products that are
produced by multinational organizations, etc. They allow for an opportunity to be provided
to rural women for them to produce earnings and aid their personal growth allowing them
to work at home. This assists to succeed in the just and impartial distribution of money by
creating non- discriminatory job opportunities country wide. These companies help adapting
a self assistance and entrepreneurial culture by bringing using skills to gain finances via
different lending and skill improvement schemes. SMEs draw in foreign investors form large
organizations that outsource from countries with powerful SME sectors. The low labour
costs allow very affordable manufacturing of semi-finished good for large organization
operating in international markets. (Hafeez-ur-Rehman,Masood Sarwar Awan, Imtiaz
Ahmed)
However, larger organization generate impressive revenues producing quality products and
services. Most people are status conscious as well as quality conscious and their
psychological needs are fulfilled making purchases of expensive/ high quality products
mostly in the name of brand hence, better economy,
Large organizations organizations bring in huge FDIs by investing in various businesses in
foreign countries. FDI plays a vital function in the evolution of developing countries.
Important and positive externalizations are brought to the processing economies by them
for example labor managements, training possibilities and hence grows the standard of the
production operations. they help developing countries raise the economies, through
technology transfer, stand independent and stable by technology spill over. (Bauer, 1991;
Easterly, 2006)
Joint Ventures, Mergers and Acquisition are another additions to the economy. They are
mainly exploited as a growth scheme by large organizations. The main purpose of these is to
help with the growth of revenues, accomplish speedy development and a quick way to gain
market shares (Khan, Majeedullah & Khan, Safiullah & Rizwan, Muhammad. 2018).
Economic growth is often built upon the foundation of infrastructure. Railway stations,
bridges, roads, flyovers, etc represent infrastructure.These are vital for the development of
main production sectors of agriculture and industry. Not having its enough availability or the
former leads to the substandard usage of assets in the latter.The facility of transports
intensify productivity greatly.Infrastructure is basically the key to modern technology in
nearly all sectors.A close relation is determined between the infrastructure development
facilities and the increase of economy. 1 % increase in infrastructural stock brings about 1 %
increase in per capital GDP (Quora.2020.)
Due to the size of these companies and the number of operations that need to be carried in
them, a huge work force needed.These companies also invest huge amounts in CSR activities
in a country (Brenkert, 2017).
Their chances of survival are higher since they have enough capital as well as generate way
more revenues than any other entity. Their survival chances are further strengthened due to
their legal structures they lead to more sustainability, and on the long run contribute to the
economy for a long period. Huge revenues mean large sums of taxes which once again add
to the economy.
D2 Critically evaluate how small businesses have an impact on different levels of the
economy (local, regional, national) and in an international context.

Small businesses effect the economy in various ways. On a local level, they provide new
innovative product and services to their local consumers, and the revenue they generate
adds to the economy.They are able to react upon and adjust to changing financial conditions
fairly quick. Costumer loyalty even during economic crisis means they’re mostly able fight-
through and sustain themselves during difficult times. This allows for local economies to
further strengthen . On a regional level, they can participate against organization of types
similar to them by supplying products of good quality and services that fulfill customer
demands. They aim to recruit workers paying low salaries due to lack of capital which helps
cut down unemployment. They also provide women in village the opportunity to work from
home and they are later linked to larger firms. On a national level, they can scatter in various
areas of the country and raise revenues that allow them to pay higher taxes helping the
country develop. On an international level, small companies attract foreign multimillionaire
companies that use their cheap workforce for the production of semi-finished goods which
again, contributes to the economy.
LO3 Determine and assess the key aspects of an entrepreneurial mindset
P5 Determine the characteristic traits and skills of successful entrepreneurs that differentiate
them from other business managers.
The following are the characteristics observed by as successful entrepreneur:
Vision:
Having a vision is essential for any entrepreneur, it gives them set a foundation for the
purpose for their business aswell as find a direction for it too. Having a vision allows them to
set their short and long-term objectives, and lead the decisions along the way. It can be said
that to seek a vision for an entrepreneur is for them to vision a dream and have a plan of
fulfilling it.
Flexibility:
An entrepreneur requires having flexibility. They require having the will to change if and
when needed. They need to be prepared to adapt to any prospective changes or any twists
or turns in their plans.This skill also refers to having a flexible thinking for them to be able to
see above and beyond things in general aswell as issues for them to be able to work through
them using effective solutions.
Customer Focus:
An entrepreneur’s number 1 priority is always the customer. Their entire vision and its
success depend on his consumers and so it is always an entrepreneur’s mission to make sure
his customers are taken care of. They make sure to pay close attention to each detail of what
the customer desires, be it the design of the product, the idea of the product, its cost, etc.
Any feedback from a consumer is essential.Ultimately customer is the person the success of
the failure of a business depends on and so a good entrepreneur posses the skill of having
customer focus.
Passion:
An entrepreneur is required to be passionate. Having profound feelings towards fulfilling
their vision would allow them to find and remain motivated even they feel demoralized.
Having an absolute drive to achieve a mission and its goals is very important for any business
to be successful.

Risk Taker:
A good entrepreneur is comfortable taking risks. Successful businesses aren’t lead by playing
things too safe which is why an entrepreneur’s skills includes them having a sense of risk
taking (how, when and where to take one). Although these risk are not just any random
picks they are carefully calculated risks which are more likely to be fruitful. An entrepreneur
should want to and be okay with taking a few risks.
Strong Work Ethic:
A good entrepreneur has strong work ethics. They often follow being punctual, being the
first to arrive and last to leave. They would know check in even on off days making sure
everything is coming together and that results live up to their expectations. They make sure
to set a good solid example for all their employees to follow.
Team Work:
A successful entrepreneur has a great sense of leadership and communication, both these
skills are vital for the development another key skill that is team work. Team work is super
important for any business to work efficiently all members must always be in sync and
producing productive outcomes. An entrepreneur makes sure to include all member while
communicating tasks, etc to produce desirable results.
Resilience:
For an entrepreneur to posses resilience refers to the way they view setbacks. A successful
entrepreneur sees minor or major hiccups as stepping stones towards growth and progress
instead of treating them like danger that can only cause failure. Resilience ultimately it, how
quickly they recover and manage to motivate themselves post a setback and the mindset
they have towards it whether they let it demotivate them or use it as motivation to keep
going.
P6 Assess how aspects of the entrepreneurial personality reflect entrepreneurial motivation
and mindset.
The entrepreneurial personality of an individual is necessary when setting up a business.
They need to be prepared to tackle the various issues and threats they might have to face.
An entrepreneur requires having flexibility and having the will to change if and when
needed. They need to be prepared to adapt to any prospective changes or any twists or
turns in their plans.A good entrepreneur also possesses resilience which refers to the way
they view setbacks. Both these skills are linked to the tenacity and persistence mindsets.
Tenacity and persistence is when an entrepreneur refuses to give up and push through all
difficulties. This mindset refers to having a flexible mindset for them to be able to see above
and beyond things in general aswell as issues, for them to be able to work through them
using effective solutions. A successful entrepreneur sees minor or major hiccups as stepping
stones towards growth and progress instead of treating them like danger that can only cause
failure. At the end of the day its all about how quickly they recover and manage to motivate
themselves post a setback and the mindset they have towards it whether they let it
demotivate them or use it as motivation to keep going.
An entrepreneur is required to be passionate. This resonates with the mindset of ‘drive.’
Having profound feelings towards fulfilling their vision would allow them to find and remain
motivated even they feel demoralized. Having an absolute drive to achieve a mission and its
goals is very important for any business to be successful.
Skills such as risk taking where entrepreneur is comfortable taking risk and have a sense of
how, when and where to take one reflect on their non-conformist mindset where they don’t

mind taking a huge leap by entering a market that other might refrain from. Since the
chances of failure are high, their plan counters greater scrutiny which makes them more
likely to achieve success in the long term if they make it through to the market.
Possessing the skill of team work where the entrepreneur has to the quality perform
independently as well as with multiple partners. It resonate with team player mindset where
an entrepreneur has a great sense of leadership and communication, since both these skills
are vital for the development another key skill that is team work which is super important
for any business to work efficiently, and for all members to always be in sync in order to
produce productive outcomes. An entrepreneur makes sure to include all member while
communicating tasks, etc to produce desirable results.
An entrepreneur’s number 1 priority is always the customer, hence they posses the skill of
customer focus. This can be linked to the mindset of seeking out niches and market gaps.
Both these terms represent exploring unexplored markets. These markets can be used to
extend a business’s consumer base via raising awareness and exploring opportunities and
coming up with innovations that specifically target a niche audience, special advertisements
of existing products and services can be marketed to them as well but in a manner that
would be more appealing to a niche market. Having customer skills means the entrepreneur
makes sure to pay close attention to each detail of what the customer desires, be it the
design of the product, the idea of the product, its cost, etc which would help them observe
what innovations they can come up with in order to earn a consumer base in niche markets .
Any feedback from a consumer is essential.Ultimately customer is the person the success of
the failure of a business depends and so be it a large or small audience and so having a sense
of good customer care also means cater to the demands of ALL their existing as well as
possible customers, hence catering to niche markets.
M3 Explore and examine different lines of argument relating to entrepreneurial
characteristics.
There is an association between entrepreneurial tendencies and personality traits of
individuals. In some cases personality traits serve as a hinder for some people. Sometimes
individual fortunate enough to posses both while other times they’re not.
It’s an ongoing argument whether entrepreneurs are born leader and hence, born that way
or whether, anyone at all can become an good entrepreneur
Vision, pro-activity, creativity and opportunism are the most commonly linked with
entrepreneurial characteristics.
Having a vision is essential for any entrepreneur, it gives them set a foundation for the
purpose for their business aswell as find a direction for it too. Having a vision allows them to
set their short and long-term objectives, and lead the decisions along the way. It can be said
that to seek a vision for an entrepreneur is for them to vision a dream and have a plan of
fulfilling it. However vision is not skill an person can learn, it is a personality trait for person
to envision a whole plan. Not just the desire to set up a certain business or project but to
envision where they see it in the next many years and what outcomes they expect out of it
and what steps they would take to achieve that forming long and short term goals.
Proactive refers to being able act beforehand upon a situation that could occur in the future
instead of waiting to react post the occurrence takes place.
someone who, to influence environmental changes, takes an action is identified as a
proactive individual. A proactive entrepreneur would first determine the opportunities
followed by exhibiting initiatives to make alteration before carrying out an action and hang
in until they have gotten to a closure by accomplishing a productive change. However, if the
Individual doesn’t posses a proactive personality they are likely to fail at determining the

opportunity and a great opportunity to make changes slip away.
The entrepreneur has a chance at improving themselves if they join various classes such as
seminars, stay updated about their area of business and problems that could impact their
entrepreneurship process,also through reading industrial articles, books, etc.
Tatparanandam Ananda Krishnan is a proactive entrepreneur, and while he was achieve his
masters education ,he had also been employed for the student newspaper and ran a betting
operation along. That allowed him to develop into a risk-taker and at the moment he holds
the possession of shares in Tanjong Public Limited Company - an investment holding
organization with subsidiaries active in power generation (Powertek), gaming (Pan
Malaysian Pools), leisure (Tropical Island, And TGV Cinema) and property (67% Maxis
Tower). He also has business involvement in media, satellite oil and gas and
telecommunications . (entrepreneur: Proactive.2020)
Creativity is when an individual brainstorms and comes up with a fresh new, exciting and
useful idea.
With the growing rate of manufactures good being exported to international markets,
customers have an access to a huge varies of product and services, ranging from what type
they are to what their quality is. Creativity allows an entrepreneur to come up with ideas to
improve active business practices. A brand might already be super established and have a
high demand consumers popular among the consumers, regardless there is often a room for
improvement and innovation. A creative entrepreneur is capable of introducing the most
out of the box ideas and innovations. An entrepreneur evaluates the requirements of how
an idea can be executed by through examining available vs. Required resources, how to set
up a new business and how to manage it. They provide the practical prospect of it to bring
the artistic creativity into existence which helps bringing together the creativity aswell as
traditional business approach.
A creative entrepreneur would keep the mind various aspect while brainstorming for ideas.
They view the practicality of their idea, whether or not it would, gain a customer base,
produce a useful product, earn profits or not. Experimenting with various ideas is the initial
step any entrepreneur would take and then observe its different findings and learnings its
experience before the actual implementation of all its learning with solutions to all the
errors made earlier while experimenting. They are not afraid to make a risky choice and limit
the creativity, they believe in their final outcome. They are willing to enter and explore new
markets such as niches . An entrepreneur acknowledges that all ideas , products and services
have a room for improvement, always and are open to all types of feedback that would
potentially help them improve and refine their ideas. (Cleverism. 2020)
However, to bring the various ideas into existence, a creative mind has to have
entrepreneurial skills such as those mentioned above otherwise they would be unable to
come up with extraordinary innovations, and not know how to execute their ideas either.
They would lack the sense of not just creativity but practicality eventually causing their
business huge losses. Unfortunately creativity is not a skill that a person can learn, it is a
born talent that a few people are blessed with.
Opportunism is taking opportunities as soon as they arise, irrespective of any principle or
prior planning.
Opportunist entrepreneurs tend to have a great eye for opportunities, as soon as they spot
on they capture and cash it as much as they can. They are great at studying and probing
various areas of the market always looking to pounce on an opportunity, they usually aim at
achieving financial gains and have an impressive knowledge of their industry and market.
These enrepreneurs tend to be super attentive of the tiniest of information and details so
that at any given opportunity they can take advantage of it to profit their business in all the

ways possible. They keep an eye open for great opportunities at all time, and have the ability
to think on their feet.
Any person that is int attentive enough would miss out on details and pass up a great
opportunity for the profit of their business. A person is required to have a super sharp and
attentive mind in order for them to be able to act as an opportunist. This is an instinct that
not all individuals are born with, however some extensive efforts can possibly help a person
earn this skill such as more exposure in the business world, more experience, learning from
other opportunists by observing them, travelling, learning to follow your instincts, learning
and practicing to be extremely attentive and present minded.
Ed Lowe in an example of a successful entrepreneur, who started out as a regular person.
Back in 1947,when he worked for his father’s company, a discontent neighbour came to him
whose cat’s litter box had gone empty and she asked ed for some sand to fill it. To more or
less get rid of her, he made an offer to her for another one of his father’s products, an
absorptive clay hat was used for factory floors, however she returned him for more and,
detection an opportunity, ed decided to turn his accidental idea into a business. He sold it to
local pet stores in five-pound bags tagged “kitty litter”. It gave him a huge amount of success
and ended up setting up a wholesaler to trade the product to pet stores and supermarkets.
Eventually he traded his company for $200 million (Talk Business. 2020)
Numerous researches (mentioned below and in reference) claim that people are born with
the characteristics of an entrepreneur. 2 out of the 4 main characteristic that are pro-activity
and opportunism can be learnt and gained as a skill to some extent while the reaming, vision
and creativity are just something that people are born with. It can be concluded that its is an
on going battle and maybe more researches in the future would support latter, that
individuals that lack entrepreneurial tendencies and personality traits are capable of
learning those skills and establishing themselves as successful entrepreneurs.
Researches (F. Leutner et al.2014), ( Flora, C.B., 2006), (Matthews, R.B., Stowe, C.R. and
Jenkins, G.K., 2011)
D3 Analyzing the characteristic skills, traits and motivational drivers of at least two successful
entrepreneurs with examples:
Having a vision is essential for any entrepreneur, it lets them set a foundation for the
purpose for their business aswell as find a direction for it too. Having a vision allows them to
set their short and long-term objectives, and lead the decisions along the way. They get their
motivational drive from anticipating see a dream come true, from vision to reality. Many
traits helped Steve Jobs reach the success he has today. He had a vision for his company's
products and services to flip the way in which people interact, work or live their lives. He an
empire out of a simple vision that Apple's products and services would change the world.
Creativity allows an entrepreneur to come up with ideas to improve active business
practices or come up with fresh new innovative out of the box ideas.They provide the
practical prospect of it to bring the artistic creativity into existence which helps bringing
together the creativity aswell as traditional business approach and it gives them the
motivational drive of introducing something new and unique to the world, which would
generate huge revenues for them and possibly earn them a brand name too.
Steve Jobs had an amazing grasp of the concept of innovative and interactive design and the
amazing skill of innovating mind-blowing technological gadgets that are now used on a daily
bases. He strongly believed that design is a critical element to developing extraordinary
products. This eventually became Apple's competitive advantage and evolved into
company's brand.
An entrepreneur is required to be passionate. Having profound feelings towards fulfilling

their vision would allow them to find and remain motivated even they feel demoralized.
Having an absolute drive to achieve a mission and its goals is very important for any business
to be successful where as skills such as risk taking where entrepreneur is comfortable taking
risk and have a sense of how, when and where to take one reflect on their non-conformist
mindset where they don’t mind taking a huge leap by entering a market that other might
refrain from. Their motivation drive in the fact that eventhough the chances of failure are
high, and their plan counters greater scrutiny which makes them more likely to achieve
success in the long term if they make it through to the market. Steve Jobs was highly
passionate and fearless with his determination and want to grow Apple. He took many
controversial in his career and at some points even had the future of the company at stakes.
An entrepreneur has the taits of a leader and well as team player. Being a leader means they
have natural instincts of how to lead be it a compnay or a team. They know the right balance
of all things and so they know exatly just how hard to push their employees, enough to get
wanted result wihout pushing them over the edge. Team work on the other hand is aslo
super important for any business to work efficiently all members must always be in sync and
producing productive outcomes. An entrepreneur makes sure to include all member while
communicating tasks, etc to produce desirable results. Steve Jobs had the amazing capability
of pushing his organization and workforce to their limits without going over the edge.
Ultimately customer is the person the success of the failure of a business depends on and so
a good entrepreneur posses the skill of having customer focus.They make sure to pay close
attention to each detail of what the customer desires, be it the design of the product, the
idea of the product, its cost, etc. Any feedback from a consumer is essential.Their motivation
drive is that they want to make customer their number 1 priority and that their entire vision
and its success depends on consumers and so it is always an entrepreneur’s mission to make
sure his customers are taken care of. Good customer care is just another skill of an
entrepreneur. Steve Jobs was the perfect example of this, and that he was a great
salesperson, if a person was a possible customer or a regular customer, he helped them
understand why they had to have Apple's products or services.
LO4 Examine the different environments that foster or hinder entrepreneurship
P7 Examine, using relevant examples, how background and experience can hinder or foster
entrepreneurship.
Background and experience causing entrepreneurship to hinder or foster:
The education of a person is vital for personality development. Lack of education also means
that the individual has little knowledge on running a business, having natural instincts are
not always enough when it come to running a business. Everything seems easy until you
have to do it, and so it might seem very easy to run a business but there is a whole science
that goes behind it, just having a general idea of how it works does not cut the slack. It
would also mean very little personality development in an individual, they would just not
have the right skills to be able to survive the heat of corporation world. However, using good
education to their advantage with an individual having all the know hows of running a
business. Their fully developed personality would give them the confidence needed to
survive in the practical world. Riaz Malik had very little education however, today he
stands a founder of Bahria Town, the largest privately owned real estate development
company in Asia (Wikipedia. 2020)
Age could be a set back for being too young. It could signify for not having enough
experience, and the maturity to be able to deal with industrial issues, money matters etc. A
person requires mental and emotional maturity to be able to run a business. However a
young mind could be a gold mine. Sheldon Adleson set his business career at 12 yrs old, he
had his uncle let him borrow $200 and bought a license to sell newspapers in Boston.

Coming to present day, he had created almost 50 of his own businesses, which make him a
serial entrepreneur (Wikipedia. 2020)
Having a supportive family would mean having the confidence to do anything you want,
knowing that the people you love have strong faith in you is a huge boost to the confidence
as well as self esteem. It would allow an entrepreneur to act upon their idea,etc more
efficiently. A discouraging family, how ever wold crush their confidence, and self-esteem,
they would never believe enough in themselves to give them a chance to prove to
themselves their capability. arfa kareem is an example When she was 9 she became the
youngest Microsoft Certified Professional. At the age of 10, she earned a pilot's license and
had maintained the world record until 2008. Her young age and extraordinary talents
needed family support, and seems like, their love and support was all she needed to become
a legend (Wikipedia. 2020. Arfa Karim)
A bad political or economical situation such as its laws, corruption issues, increase of taxes,
war threats, along with other threats, low currency value, bad decisions, etc would case an
entrepreneur to back off, and get demotivated, they would have to wait to the situation to
turn around because the opposite of all these factor would work in a definite favour of
them. For example back in the day when Pakistan was dealing with alot of terrorism, the
country’s economy was largely affected since all tourism were canceled for a long time and
foreign tours and a high revenue earning source for Pakistan. However, in recent times,
foreign tourism activities have continues and they’re generated revenues more than ever.
M4 Analyse the link between entrepreneurial characteristics and the influence of personal
background and experience to specific successful entrepreneurs.
Personal background and experience help an individual to establish a successful business.
Mr. Ali is unemployed, he is having trouble getting employed, his family and friend are very
supportive, they keep encouraging him to be patient and not not give up. This has motivated
him to want to set up a small food venture. His has his long and short term goals envisioned,
and his goal is to be recognized locally as the best roll paratha selling joint. Ali is new at this
and so he has, joined an internship at another food joint, just to gain some experience and
use it for the advantage of his own business that he is in the process of setting up. Finally he
has launched his business TRP,and has also hired a small workforce. He keeps them all
together and organized and makes sure they all feel involved, he communicates with them
efficiently in order for all procedure to go smoothly.
Mr.Donald is running a huge, multinational firm called McDonald’s, He’s had prior
experience of working at a stall making hamburgers which were loved and earned him alot
of finances, he took that idea and money and built his own empire, taking the risk of
separating from a famous brand name and creating his own. The beginning of McDonald’s
was rough for Mr. McDonald, due to a controversy the firm lost alot of its customers but it
turned of to be a defamation case and he saw it only as a stepping stone, perhaps a catalyst
Mr Ahad, is 30 years old and unemployed, he is unable to get any jobs due due his lack of
education, he however, has a nice simple lifestyle and has a love for collecting cooking books
since cooking is his passion. Driven by his passion to cooked and his need to collect books he
has decided set up a shawarma stall by the name of Syrian Shawarma. He got this idea from
back in his home type Syria where this food item was very popular among customer and he
came to this country as a refugee due to the political situation in his homeland and is now
running a business based on customer demand.
Lastly, there is Saba, age 12 she sees her father doing alot of charity work and so has a drive
to contribute the society somehow she used to shelter and feed abandoned kittens which
gave her the idea to set up a social-cause business with the help of her father, it’s called
Ehsaas Sylan Dasterkhwaan. She follows strong work ethics, by earning no profits what so
ever and using the charity money to expand the number of people and areas that are fed
free food.

D4 Critically analyse how background and experience influences entrepreneurs, both
positively and negatively, by comparing and contrasting examples.
The education of a person is vital for personality development. Having little education also
means that the individual has little knowledge on running a business, having natural instincts
are not always enough when it come to running a business. Everything seems easy until you
have to do it, and so it might seem very easy to run a business but there is a whole science
that goes behind it, just having a general idea of how it works does not cut the slack. It
would also mean very little personality development in an individual, they would just not
have the right skills to be able to survive the heat of corporation world. However, using good
education to their advantage with an individual having all the know hows of running a
business. Their fully developed personality would give them the confidence needed to
survive in the practical world. Example: an educated entrepreneur would be able to handle
company’s accounts and be able to identify issues where as a lesser education person would
bare be able to make sense of it.
Age could be a set back for being too young. It could signify for not having enough
experience, and the maturity to be able to deal with industrial issues, money matters etc. A
person requires mental and emotional maturity to be able to run a business. However a
young mind could be a gold mine.
Example:A younger entrepreneur might get emotionally attached to their employees, and
when the time comes had trouble firing them. A person with an mature approach would be
able to do the job easily.
Having a supportive family would mean having the confidence to do anything you want,
knowing that the people you love have strong faith in you is a huge boost to the confidence
as well as self esteem. A discouraging family, how ever wold crush their confidence, and self-
esteem, they would never believe enough in themselves to give them a chance to prove to
themselves their capability. Example: a person with a supportive family is likely to succeed
because they have enough confidence to bring their ideas to life, a person with a
demotivating family, however would only cause them despair because they don’t feel good
enough of being capable of achieving anything
A bad political or economical situation such as its laws, corruption issues, increase of taxes,
war threats, along with other threats, low currency value, bad decisions, etc would case an
entrepreneur to back off, and get demotivated, they would have to wait to the situation to
turn around because the opposite of all these factor would work in a definite favour of
them. For example back in the day when Pakistan was dealing with alot of terrorism, the
country’s economy was largely affected since all tourism were canceled for a long time and
foreign tours and a high revenue earning source for Pakistan. However, in recent times,
foreign tourism activities have continues and they’re generated revenues more than ever.
Conclusion:
Start-up businesses are of various types e.g small, micro, medium and large businesses.
Small businesses capture a huge fraction of numerous industries with a high contribution in
the economy of a country. Entrepreneurs require having specific skills and a certain mindset
to start-up and operate a business while determining various risks.

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