Impact of Business Growth on UK Economy

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This assignment delves into the multifaceted aspects of business growth within the UK economy. It examines various factors that contribute to this growth, including changes in organizational size, sales expansion, technological advancements, customer satisfaction, and operational efficiency. The analysis also considers the impact of these factors on key performance indicators like profitability (gross profit margin and operating margin), employment levels, and the overall effectiveness of recruitment processes.

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Research Title:
Determinants of Profitability in Small and
Medium Sized Enterprises (SMEs) in the UK
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Acknowledgement
I owe my deepest gratitude to almighty “Allah” the most Gracious and the most Merciful, who
has provided me ability to complete this work. This dissertation would not have been possible
without my mentor who has motivated me to have proper contribution the project. Along with
this, the proper standards are being followed in order to advance the commitment so that entire
dissertation can be carried in the right manner. Learning about such measures has also inspired to
have proper contribution. I am thankful to family members and friends because they have
provided me support in completion of the research work. Along with this, I would like to thank
my classmates who have provided me support in the understanding of subjects so that
dissertation writing can be accomplished. I would also like to thank my classmates who has
assisted me to have appropriate analysis. Support of Professor. MERVIN SOOKUN, my
professor has provided me diverse suggestions to strengthen the outcome of the investigation,
which has provided me assistance in completion of dissertation. At last but not least my thanks to
all my lecturers who helped me in meeting academic criteria during the journey of the University
of the West of Scotland.
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Abstract
Enterprises are being owned and managed by the small corporations, sole proprietorship and in
partnership. In this, less employees are being employed are being appointed for working in the
company. Enterprises mainly lacks with their financial support as these companies are owned by
less number of people so the amount contributed is also limited. This results with the deficiency
of the funds for the development of the company. HR strategies allow ensuring that social and
human resource aspects are well maintained. (Collis and Hussey, 2009). There are a number of
factors which provides a better success of the small business organisations such as business
culture within organisations is well motivated it also has a direct impact on the profit margin
ratio of business. Evaluation that the majority of small businesses' precept that operations is
profitable. It has been noticed that respondents' percept that their cost and current sales are at the
same level so they cannot provide appropriate in respect to the statement (Clark, 2002).
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CHAPTER 1-
1.Introduction
1.1 Overview
Small business organization is considered as one of the critical aspects of the UK economy
because it provides a high contribution to economic development. Such kind of businesses is
mainly operated at a small scale and numbers of employees are also less. In addition to this, it
can be said that enterprises that employ less than 250 employees, whose annual turnover is up to
the maximum limit of 50 million Euro and total of the balance sheet does not exceed 43 million
Euro are called as small and medium-sized enterprises (SMEs) (UK small business. 2013). With
the change in time, a role of SME's in the economic growth and development has also
transformed (Miles, 2011). They make an effective contribution to the nation’s growth in context
to the advancement in gross domestic product (GDP), more employment opportunities and
bringing innovation. With reference to United Kingdom (UK small business. 2013), in the
beginning of 2016, 5.5 million private sector enterprises are operating as SMEs which have been
increased by 97000 from 2015.
Along with this, SMEs that are able to get sufficient capital are suffering with difficulties due to
lack of management skills and experience. Entrepreneurs have no great knowledge of financial
management and unable to utilize the funds and revenues in an efficient manner which in turn
increases business costs and results in declining profitability (Nijssen and Frambach, 2001).
However, in the present scenario of volatile external market conditions, only those entities can
survive that are operating successfully.
It has been noticed that small business firms are mainly focused towards advancement in the
profit margin ratio. A number of activities with regard to financial analysis are being considered
as a critical aspect so that management with respect to costing can be controlled effectively.
Businesses are also well focused towards business expansion in order to have advancement in the
market share (Afiouni, 2013). By having the assistance of expansion activities, business entity is
well focused towards profit margin ratio. It has been noticed that profit can be advanced through
improvement in sales (Allen and et.al., 2014). In the present study, key aspects will focus on
profitability of SME’s who have operations within UK. Moreover, this research also provides
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determination of various factors that affect the firm’s profitability. Furthermore, it also compares
the profitability of a small sized business with a medium sized organization of the UK. It also
provides information with regard to various growth indicators of the profitability of SMEs. In
association with this, recommendations about appropriate ways to maximize net return of SMEs
in the future period is also a critical aspect of the study (Reid, 2007).
1.2 Research Problem
Small business firms are having an effective participation in the economic development of the
UK. Along with this, a number of small business organizations of UK are looking forward to
have expansion in the services so that the profit margin and market share can be advanced
efficaciously (Agrwal, 2012). It has been noticed that a quantity of previous readings have been
conducted to evaluate the profitability of SMEs but there are very few evidences present with
regard to profitability. In order to overcome the limitation of previous studies, the existing
dissertation topic “profitability of small and medium sized enterprises in the UK. ” Is being taken
into account (Sahut and Peris-Ortiz, 2014). Moreover, in the historical years, none of the
investigators compared operational performance of a small sized entity with that of a medium
sized firm. In addition to this, it can be said that the current study is beneficial to overcome the
gap between key aspects and provide a better understanding with respect to the small business
firms and their working.
A number of initiatives are taken into account to promote the working and the presence of small
business firm. It means that by having appropriate information about the subject, overall working
of small business firms can also be advanced successfully. With the help of this, they can
formulate better policies and make decisions for encouraging SMEs. In accession to this, firms
will be getting benefited because they can find numerous ways to maximise their potential to
make profits (Andersen and et.al. 2016). As a consequence, they can move their operations
without any hazards would enhance strategic and competitive strength and assure long-run
sustainability as good. Another rationale behind the selection of topics is that small businesses
are having consideration of policies to improve the market share and sales. But they do not have
an actual understanding about cost control which is significant for the advancement in profit
margin ratio. By receiving an appropriate consideration of the key elements of the study
outcomes, such kind of issues might overcome (Hatten, 2011).
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1.3 Aim and Objectives
Aim: Present investigation is focused towards the analysis, profitability of small and medium
sized enterprises in the UK.
Objectives
To evaluate the operations of small and medium sized enterprises
To determine various growth indicators of profitability of SMEs
To examine numerous reasons that disturbs the profitability of enterprises which operate
at small and medium scale.
To compare the profitability and growth of medium sized enterprises with that of small
scale firms
To recommend appropriate ways to maximize net return of SMEs in the future
1.4 Research questions
Q 1. What are the factors that indicate growth in SME’s profitability?
Q 2. How various factors like size, growth, current ratio, gross profit, gearing and asset-turnover
affect SME’s net yield?
Q 3. How small and medium sized enterprises can maximize their net project’s yield in the
forthcoming period?
1.5 Focus and Purpose
It has been noticed that the key motive of present investigation is to analyse the
profitability of enterprises which operate at small and medium scale in UK. With assistance of
this, the growth of small business organizations can be considered into account because it assist
in meeting objectives. Present investigation will meet the purpose of analysing gap in the subject.
Numbers of previous studies are being taken into account. They have some limitations which
have affected the effectiveness of outcomes. In order to overcome the limitations of the present
study, researcher has selected the present study topic (Jackson, 2010). Along with this, numbers
of literature documents with regard to small businesses and their growth have been analysed. It
provides learning about the subject and assists in understanding the growth indicators of SMEs.
Various researches have been conducted on the concept of small business firms, but the
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outcomes of studies were not much helpful. In addition to this, it can be said that to provide a
proper justification to the outcomes, the present study is being taken into account (Khan, 2011).
It has been observed that a key motive behind the present investigation is to have determinants of
profitability of low and medium sized enterprise in the UK. By owning an application of profit
margin ratio analysis, companies can have better designing of opportunities. Present study allows
to have the determination of diverse factors which are associated with the long term working of
small business organisations. Along with this, factors related to work culture, sales and revenue
of small businesses have been evaluated effectively.
Small business firms are having an effective participation in the economic development of the
UK. Along with this, a number of small business organizations of UK are looking forward to
have expansion in the services so that the profit margin and market share can be advanced
efficiently. It has been observed that a number of previous subjects have been taken to assess the
profitability of SMEs but there are very few evidences that are present with respect to
profitability. It is one of the key reasons that present study topic is being selected to provide
better evidences. Present study outcomes also will assist in analysing factors that bear upon the
profitability of enterprises which operate at small and medium scale.
1.6 Framework and analysis
For continuous improvement and accomplishment of the objectives, it is significant for an
investigator to have a suitable collection of outline. It assist in analysis for better outcomes. It has
been noticed that framework and analysis is a section which provide systematic steps for
accomplishment of objectives. It also helps to meet the standards of conclusion and
recommendation chapter.
Design of research It is important for a researcher to have collection of policy so
that better support can be provided to study. Explorer and descriptive design is mostly referred
by the investigator. In the present study the exploratory research has been planned in order to
have appropriate accomplishment of designed objectives in the anticipated way (Herbane, 2010).
It is a design which assists in providing the description of characteristics of the population so that
reasons can be identified behind advancement in profit margin of small business firms.
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Explanatory research design helps to provide an explanation of variables. It will accomplish the
objectives effectively.
Research approach – In the present study the deductive approach will be employed
so that better outcomes can be attained effectively. It has been witnessed that the present
approach selection provides a flexible structure so that outcomes can be attained. It is a reason
that provides a better opportunity in order to accomplish objectives of the investigation. It allows
to understand the concept of small business firms (Crowther and Lancaster, 2012).
Research philosophy – Positivism and interpretivism approach is mostly employed
by the researcher. With respect to the present investigation the positivism approach is being
adopted by the investigator. It allows to analyse the significance and operations of small medium
business.
Techniques of research Qualitative and quantitative research techniques are a
key valuable aspect that allows to accomplish better outcomes. However, for the current study
the quantitative technique of research has been employed. It helps in ensure that sustainable
values in regard to accomplishment of objectives can be attained. With an assistance of this,
statistical interpretation has been provided in data analysis under quantitative values.
Method for data collection – Primary and secondary data collection have been
employed by the investigator in order to ensure that information is being gathered in a significant
way. It has been observed that for primary investigation the questionnaire has been designed on
the basis of objectives. Responses have been taken from the sample universe to outline the
primary research outcome (Pring, 2014). On the other side, books, journals, govt annual report,
online resources have been followed to gather secondary information. It has been made sure that
literature was related to the subject to relevant outcome.
Sampling technique – Random sampling technique has been considered by the
investigator so that data collection can be accomplished effectively (Khan, 2011). Along with
this, the sample has been applied by the researcher and data has been collected from 10 managers
of small business organizations.
Analysis of data In the present research, quantitative technique will be used for
analysing the data. It has been noticed that overall study is based on the quantitative aspect so
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selection of technique for data collection also needs to according to the nature of the study. In
addition to this, it can be said that statistical information is being presented in the data analysis
section for better understanding of the outcome (Saunders. et. al., 2010).
1.7 Potential Significance
The present investigation is focused towards analysing the profitability of small and medium size
enterprises in UK. It will help in understanding the concept of small business organization and
allows to identify key success factors of the business. Present investigation provides a diverse
benefit to the learners. One of key significance is that it provides better learning to academicians
and helps in meeting the standard of courses. It also assists in determining the issues faced by
small business enterprises. It will also provide various benefits to the small business
organisations so that they're working can be advanced inappropriate manner (Silverman, 2010).
With an assistance of the report the organisations can have understanding about the factors that
impact profitability of small and medium sector enterprises. The research will be important for
the philosophers. With an assistance of this, deep and innovative outcome can be presented so
that integral part of the research can be attained effectively. Along with this, the understanding in
regard to literature documents can also be developed so that improved operations can be
designed. With an application of present investigation the issues that impact the working of small
business organizations can be overcome so that the profit margin can be advanced in an effective
manner (Jackson, 2010).
1.8 Chapter Structure
Research study also needs a suitable structure so that key outcome can be understood in
an appropriate way. By having an effective presentation of systematic defined structure the
research can be accomplished successfully. The structure encompasses a succession of
subdivisions that procedure a vital part of the investigation learning (Smallbone, 2008). With an
assistance of this, discussion about the diverse chapters of investigation can be referred for
proper outcome can be drawn in anticipated manner. Classification of key chapters of the
investigation is as follows:
Chapter 1: Introduction It is a chapter that provides an in-depth information or
introduction about the subject. It provides information about the research as it helps in meeting
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outcome in most significant form. The introduction section will start with the overview segment.
Through effective consideration of chapter the appropriate description about the small business
organization's operations can be taken into account. The present study topic is to examine the
profitability of enterprises which operate at small and medium scale (Singh. 2010). Following
report key objectives are to evaluate the operations of enterprises which operate at small and
medium scale. In addition to this, to determine various growth indicators of SMEs profitability is
also a key aspect of the present study which needs to be considered in an appropriate manner.
Chapter 2: Literature Review It is a section which renders a proper outline
about the subject. It is because diverse writings leaflets are being compared so that outcomes can
be drawn in an appropriate manner. In this section the researcher has focused on comparisons
between profitability and growth of medium enterprises with that of small scale enterprises.
Along with this, on the basis of different literatures the ways to maximize SMEs net return in
future period will also be evaluated (Agrwal, 2012). With this, literature written by different
authors has been compared effectively in order to examine the profitability of enterprises which
operate at small and medium scale. It is beneficial to develop a better understanding about the
subject. It assist in meeting outcome of the present investigation.
Chapter 3: Research Methodology In this chapter, the discussion about
the different methods used in research has been considered as a critical aspect. It has been
witnessed that different tools are being adopted for operational achievement of the study. With
an appropriate application of the research methodology the better framework can be offered to
meet the objectives of the investigation. In this section the proper justification has also been
provided behind the selection research tool and technique (Sahut and Peris-Ortiz, 2014). Along
with this, it also provides information in regard to ethical considerations and limitations so that
efficiency of study can be well preserved in an appropriate manner. It also allows having
appropriate use of resources so that result of the current study can be achieved.
Chapter 4: Data Analysis and Findings It is a chapter in which
explanation of collected information is being presented so that issues can be overcome. It is a
section that provides an appropriate learning about the subject in a descriptive manner. It also
helps outline the outcomes of the investigation (Hill, 2016).
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Chapter 5: Conclusion and Recommendations This segment
provides a conclusive point of the investigation so that better outcome can be attained
effectively. Along with this, it provides a final outcome of the both primary and secondary
research. Presentation of overall analysis is being taken into account to analyse the final
outcome. Suitable references will be providing with the assistance of this subdivision (Hotho and
Champion, 2011). With an assistance of this, profitability of enterprises which operate at small
and medium scale can be analysed effectively.
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CHAPTER 2-
2.Literature Review
2.1 Introduction
It is a part which provides a proper outline about the topic. It is because different literature
documents on small business working are being compared so that outcomes can be drawn in an
appropriate manner. In this section the researcher has focused on comparisons between
profitability and growth of medium enterprises with that of small scale enterprises. Along with
this, on the basis of different literatures the ways to maximize SMEs net return in future period
will also be evaluated. With this, literature written by different authors has been compared
effectively in order to analyse the profitability of enterprises which operate at small and medium
scale.
2.2 Concept of small business firms
In the present era, there are mainly two types of enterprises which include small and large scale
organizations. Further, these enterprises are being owned and managed by the small
corporations, sole proprietorship and in partnership. In context to small businesses, it can be
stated that ratio of profit margin ratio is very low as compared to other businesses. It means the
financial support in such kind of organisation is not much impressive. As same the employment
ratio in each organisation is low, but when it is concerned with the overall employment ratio in
the nation. According to Balogun (2010), it might be high as compared to large businesses
because the ratio of small business is more in the market. The enterprises is controlled by the
individual himself and are being operated with less capitalization which is invested by himself or
by taking loans by the bank. It means financial resources are being taken into account by
businesses on their own risk. It has been noticed that financial sources issue is one of critical ask
for organisation (Barney and Clark, 2007). Working on enterprise is mainly dependent over
small scale with less investment. Such kinds of businesses do not consider complex management
as critical aspect which creates a flexible working for the company. Along with this small,
businesses generally face issues for initial years because of less number of managers (Boselie
and et.al, 2005).
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Burns (2010) contended that the enterprise is being established with small amount of money and
with less resource. Capital is being contributed by less number of people and moreover, they are
lacking with the collateral security for attaining the bank loan. Thus, because of this the
enterprise has to suffer with low capital for establishing their company. As per the view point of
the Cader and Leatherman (2011), small businesses, mainly have small market share and are not
able to dominate in the operational field. It is because the lack of competitive advantage in the
market does not allow to have the effective accomplishment of operational activities. It also
reflects that by having an appropriate focus on market share advancement the businesses can also
enhance the opportunities in context to operational activities. Further, the author has argued in
his report that because of their small presence in the market also impacts the customer base. In
addition to this, low market share result in less number of people who are following them or
attain their products or services.
Moreover, they are having low productivity, which means they are been produced with less
number of products or services for the customers (Ci-Sheng andShu-Ming, 2012). Cole (2013)
stated that, as they are working on a small scale so they are obliged to employ a less number of
staff members for achieving the objectives. As they are produced with less amount of goods so
they require fewer people for completing the task.
15Illustration 1: Comparison between small business and large
business
(Source: UK small business. 2013)

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According to report of economic experts, it can be said that employment ratio under small
businesses is highly competitive as compared to large businesses. It is because there are
numerous small business firms are there in the market. In addition to this, it can be said that in
service industry the ratio of small businesses is high which also enhances the opportunities of
employment in the service sector. Investment of ratio in manufacturing is very high, so very few
small businesses are operating the market. Over 400,000 employees are participating in working
with small business firms in the service sector. Moreover, near to 200,000 employments is held
by construction. The service sector had 58% of its employees in small business. Along with this,
small businesses produced 83% of real estate jobs and 75% of insurance agent employment.
Graph mentioned about the comparison between small business and large business indicates that
small businesses are having a great opportunity within the market which allows to have long
term sustainability (UK small business. 2013).
2.3 Issues faced by small business enterprises
According to view point of Headd (2010) it states that with a number of benefits of small
business enterprises, there are a large number of problems or issues which are being faced by the
companies. Small business enterprises mainly face the issues in regard to finance. It has been
noticed that out of 10 small businesses the 7 of them faces issues regarding finance for at-least 2
years of initial stage. Level of production is very low due to the small scale of employees in each
organisation. Such kinds of activities decreases the level of funds and create an issue in context
to deficiency of the funds for the development of the company. According to the Herbane
(2010), many of small businesses survive in the market with a help of a loan. Out of 10, nearby 4
faces issue for loan and its repayment for five years of initial level. It means the fund allocation
is a critical issue for organisations. Hynes (2010) stated that around 52 percent of small
businesses are dependent over home based work culture that creates a casual culture at work
place. It is one of the key reasons that the companies are facing issues of improper planning. It
impacts the future development of small business organisations.
Use of technology among small businesses is very low which impacts the overall working. The
Author has critically explained that issue of finance does not allow to have application of
technology. It is one of the key reason that in the year 2008 more than 270,000 small businesses
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were operating business in the UK market, but 219,000 small businesses are currently not
operating business in the market. It reflects that use of technology at the impressive level from
large businesses has impacted the working of small businesses. The Author has presented his
views that, it also provides evidence in regard to subject that small businesses are facing issues
of technology use. Along with this, 89 percent of small businesses are having less than 10
employees, which also create a barrier for the organisation. Out of which majority of the
workforce is not aware about the use of technical equipment’s which might boost the
performance of small enterprises (Brown and Sitzmann, 2011).
Small business on technology graph interpretation reflects that 41 percent of small business firms
were not having use of website technology. Along with this, the few of businesses are facing
issues in regard to finance so they have back steeped from use of the latest technology Around
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Illustration 2: Small business on technology
(Source: Soderlund, 2016)
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13 percent of small businesses have stopped the use of a website because they are not having
sufficient funds for updating with their technology in the company. According to the Kautonen
and et.al., (2010) it is the major drawback for the company to match up with other firms and also
growing their enterprise in the market. This also suffers with the quality and quantity of the
products produced by them. In addition to this, it can be said that 30 – 40 percent of small
businesses are still not having use of their own website to promote business. As per the view
point of the Khalid, (2010) it is because of lack of funds and facilities provided to them. Further,
lack of market present on internet also impacts the distribution channel because the majority of
customers prefer to take take services through the website. It impacts the marketing strength of
small business and creates further issues. It decreases the sales of the company and influences
the profit margin ratio as well.
According to a survey on small businesses, maintaining profitability and growth is a critical issue
for small businesses. 31 percent of respondents of the CBIA study on small business reflect that
they are facing an issue in regard to profitability and growth (CBIA, 2016). 14 percent of
businesses have said that staffing is also a critical aspect which creates an issue of lack of
professional management and trained personnel. Due to complex government regulations and
policies small businesses are not able to maintain staffing standards which create an issue of
unskilled and qualified workforce which also makes them inefficient in their workings (Burr and
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Illustration 3: Factors associated with SME
(Source: CBIA, 2016)

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Pearne, 2013). Cost of doing business and taxes also increases financial issues. Thus, there is no
training sessions for the development of the skills and knowledge of the employees due to lack of
funds. Economic crises are also referred effectively from smaller businesses. 6 percent of small
businesses have said that changes in economic influences raw material allocation. According to
the Longenecker and et.al., (2013), small business enterprises are not having efficient raw
materials for performing their activities.
2.4 Significance of small businesses in UK
According to the Raco and Tunney, (2010), small business enterprises play an important role in
all parts of the country as they are contributing good amount to the economy of the country. As
there are many companies which comes under this category and serves with large number of
customers with their products and services. They are as the life wire for the economy of the
country, whether it comes under the category of developing or developing nation. It has been
noticed that small businesses are mainly having fewer employees. In the UK over 28 million
small businesses are operating which boosts the economic development of the UK. Report by
Forbes reflects that over 50 percent of the employment ratio of UK is dependent over working on
small businesses. Nearby 65 percent of net new jobs are offered by small businesses of the UK.
In addition to this, it can be said that most of small business firms are having an operation with
the concept of home based work culture.
In addition to this, as per survey of CBIA, 60 percent of small businesses have full time hiring
for the job. Verreynne and Meyer (2010) critically explained that these enterprises are very
beneficial as they are serving with the entry point for the fresher’s which are having no
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Illustration 4: Employment ratio
(Source: CBIA, 2016)
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experience. In the report, it has also been identified that 59 percent of small businesses have
hired 1-3 employees in order to boost the operational activities. As same 27 percent of them has
stated that 4-10 employees will be their preference in order to boost the operation (CBIA, 2016).
It reflects that in UK economy, small businesses are having great contribution as they are
offering employment various youngsters. It has been noticed that operations of small businesses
are at a very low scale which is one of the key reason that they hire people which are ready to
work on less pay scale. It reflects that such kind of businesses does not hold competitiveness, but
they offer jobs to a large number of people and adding an amount in the economy of the country
(Crook and et.al., 2011).
Political engagement is also being referred effectively firm the small businesses to overcome the
issues. If local political parties are creating a change in corporate standards, then it will impact
the overall working of small business. It has been noticed that by having a regular basis
interaction with government small businesses are trying to discuss business issues. 34 percent of
people reflect that they use email as a medium in order to communicate with political parties.
One on one meeting is also being preferred by small business as per the responses of 26 percent
businesses. As per the view point of the Balogun (2010), communication with government
allows to ensure that legal norms are effectively followed. It also helps to compact with problems
or challenges so that overall presentation outcome can be attained in desired manner. One of key
issue that small business faces is regarding raw materials so by having a conversation with
government numbers of standards are being set out to improve working with suppliers. In this
respect, standards are being improved for improvement of small businesses. Raw materials
which are needed by the large companies are mainly produced and distributed by the firms
established in rural areas or the companies in the countryside which are producing the products
on a small scale. Such kind of aspects in regard to rural improvement has advanced the
opportunities for business. In this respect the transportation is also a key issue, so by having a
conversation with the government is the issue being resolved. Reid (2002), critically explained
that by having a conversation with the government the small business enterprises are also
improving the resource allocation. Appropriate location selection the usability of resources is
also being improved. 43 of small businesses has stated that they are more concern about location
of the business so they used to ensure about it in an appropriate manner.
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Balogun (2010), has said that personal income tax is one critical task for businesses. It impacts
the overall cost of production and the business growth. It also reflects that overall GDP of UK is
being influenced due to such aspect. It also reflects that small businesses are having greater
involvement in the UK development. According to the Burns (2010), it has stated that small
business enterprises are highly beneficial in contributing to the economy of the country. Further,
it assists in enhancing the growth and development with the innovations used in the business
enterprises. Moreover, they also help in stimulating with the economic growth by developing
with the employment opportunities for the people. Improved focus on the economic values the
small businesses are contributing in UK development. Döckel and Ligthelm (2015) has stated
that there are several things which are being ignored by the big corporations, so these small
enterprises are very important to bridge the gap between the preferences of the customers and the
goods which are being produced.
2.5 Operations and Growth indicators of SMEs profitability
According to Fitzgerald and et.al, (2010), small business organisation working is mainly referred
as operation at very low level. It is because the level of financial support is very low. Small
businesses are more focused towards niche market customers because it provides a better
opportunity to gain high profit margin at very low cost. Such kind of businesses working is
dependent over very few suppliers. Headd (2010) has stated that the success of small business
organisations is dependent over size. If size of a business firm is increasing on a continuous
basis, then it will impact the overall outcome in context to profit margin.
Organisation No. Of Employees
A 7
B 15
C 25
The Author has stated that by having a continuous improvement in the size of SME the
businesses can have continuous improvement in the profitability. For example, company A is
having 7 employees within an organisation that means the productivity of the firm will be
according to commitment of workforce so the sales and profit will also be dependent upon work
productivity. As the number of employees increases the productivity scale and sales will also get
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advanced in a critical manner. It has been noticed that by having an improved focus on the size
the profitability can be advanced. It is one of the key reasons that company B and C are holding
high margin of profit as compared to A.
As per the view of Herbane (2010), small businesses do not offer a wide range of services
because they have very less ratio of financial and human resource support. If the company is
continuously focused towards advancement in human resource support then further elements can
be advanced. It allows to advance the work performance and ensure that profit margin is also
improved in a sustainable way. In the UK the employment ratio of small business is 53 percent,
which provides an 37.4 percent of overall output. Along with this, 70.6 percent of relative labour
is also being held by small businesses in the UK. It reflects that small business firms can have
advanced in the profit margin ratio and lead businesses to improve key elements.
Hynes (2010) has contended that transactions and further activities can be well managed through
the application of MIS. It allows to improve the sales and profit margin ratio in an appropriate
manner. Effective consideration of social needs is also a key aspect which allows small business
firms to meet their objectives. Employees scale is very low which allows business firms to make
sure that recruitment and selection standards are well maintained. Kautonen and et.al, (2010) has
asserted that impact on profit margin is also positive due to productivity improvement. It allows
to meet the satisfaction scale of customers and lead business firm to an impressive level of
22
Illustration 5: Small business in UK
(Source:Small business of UK. 2016)
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success. Advanced level of productivity allows ensuring that quality services are being offered to
a customer which allows meeting the satisfaction scale. These kinds of values in business
enhance the profit margin ratio in desired manner.
It has been noticed that gross profit margin and operating margin need to be improved in an
appropriate manner so that objective can be accomplished effectively. Raco and Tunney, (2010)
have stated that by having effective balancing between such aspects the issue can be resolved in
desired manner. It also assists in meeting sustainable opportunities so that business can have an
impressive level of success. It helps in gaining actual information about the costing aspect which
is beneficial for designing of strategies. Effective application of strategies is advantageous for
improvement in business values. Return on equity and sales also need to be considered
effectively by small businesses so that objectives can be accomplished. It assists in improving the
profit margin ratio and make sure that sustainable aspect can be promoted effectively.
2.6 Factors that impact profitability of small and medium
sector enterprises.
In addition to this, it can be said that by having an improved focus on Baumol curve the factors
that impact profitability of small and medium business can be evaluated effectively. Khalid,
(2010), has stated that factors such as total cost, sales and revenue are key aspects which impact
the profit margin ratio of the company. It has been noticed that if small businesses focuses on the
advancement in advertising then it will enhance the overall cost. It also influences the total profit
in a negative manner. It reflects that the overall outcome of small businesses might get affected
due to changes in level of cost. Along with this, it has been witnessed that companies need to
ensure about the point where total cost and total revenue are balanced in desired manner. With an
assistance with this, issues can be overcome and lead the business firm to an impressive level of
success. Hynes (2010) has also asserted that sales maximisation is subject to minimum profit
constraint. It means, of having an improved focus on the key values the issues can be discussed
effectively so that goals and objectives can be accomplished effectively. The output OK will not
maximise sales as the minimum profits OM are not being covered by total profits KS. In order to
have advancement in the sales the small businesses need to ensure that production is at a level
where the minimum profit is covered along with consideration of total revenue consistent. In
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addition to this, it can be stated that biomass curve reflects that if the total cost of the process is
advancing then the overall outcome in regard to revenue will be impacted in a negative manner.
By having an advanced in regard to costing aspect the changes in financial scale of business can
be analysed effectively.
According to the Longenecker and et.al., (2013), there are a number of factors that impact the
working and profitability of small and medium business sector. In addition to this, the
classification of factors can be as size, growth, current ratio, gross profit, etc. It has been noticed
that if size of company is small then the profit margin ratio of business firm will be low. It is
because the small scale does not allow the business firm to improve customer base high scale. If
customer base is very low, then sales and profit margin ratio of business will also be low. Such
aspects must be well maintained in order to advance the profit margin ratio (Nijssen and
Frambach, 2001).
2.7 Compare profitability and growth of medium
enterprises with that of small scale enterprises
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Illustration 6: Baumol's Curve
(Source: Trisha, 2015)

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Raco and Tunney, (2010) have said that small business firms and medium enterprises working is
different because the level of employment scale is different according to the nature of business.
In addition to this, Cafe Higher is operated and controlled by family members, but MacDonald’s
is a large-scale firm which is mainly operated by concern management. Owner of small business
firm controls the application of role and responsibility. However, in medium scale businesses
work activities are associated with roles and responsibilities are mainly dependent overwork
culture and organisational need. Verreynne and Meyer (2010) has contended that operational cost
of working is also critical aspect of small business. It is because the decisions are being taken
into account on the basis of cost. By having an effective understanding about the subject the
issue can be overcome in desired manner. In medium and large scale firms the level of previous
total profit is being taken into account. Such kind of businesses tries to enhance the profit margin
as compared to the previous year in order to cut down the overall cost. Short term goals are being
set out by small business, but large businesses are attracted towards advancement in long term
goals. In order to have better understanding, it can be said that Cafe higher is a small business
firm which does not have high financial support. It impacts the investment ratio on advertising
cost of sustainable development. If the business entity focuses on the advertisement advancement
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Il
lustration 7: Baumol's Curve
(Source: Trisha, 2015)
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with low financial support, then operational cost will enhance which will impact the profit
margin ratio. On the other side, the McDonalds is a large-scale business so they have sufficient
financial sources. It means they can advance the investment on an advertisement which will also
impact the cost of operation but not large scale. It is because the profit margin scale is well
balanced by the management for sustainable development.
Kautonen and et.al, (2010) has argued that the key difference between both organisations is in
regard to operational activities. It has been noticed that operational cost of the company also
impacts the working and decision making process of both organisations. Along with this,
customer base and further key aspects of both organisations is also different. It is because the
total cost and revenue also need to be referred effectively. Operational activities of small
organisations are limited to a geographical area. Opportunities for small businesses is low as
compared to medium firms because they hold less customer base in the competitive market
(Khalique and et.al., 2015).
2.8 Recommend appropriate ways to maximize SMEs net
return in future period
According to Longenecker and et.al., (2013), there are number of ways that can be employed by
small business organisations in order to meet objectives. Along with this, significant for
management of small business to make sure that team building is one critical aspect which
allows to meet key objectives. With an assistance with this, the management can make sure that
team spirit is properly maintained so that overall work productivity can be advanced. It helps in
targeting customers more effectively so that sales can be advanced. In addition to this, it can be
said that the overall profit margin ratio can also be advanced in a critical manner. Raco and
Tunney, (2010) have contended that creating an HR strategy is significant to communicated with
members so that better outcome can be attained. It assist in meeting the benefit of helping
stakeholders. It allows to make sure that overall objectives can be accomplished in desired
manner. In addition to this, it can be stated that by having an assistance of diverse economic
development model the small business organisations can have improvement in services. With an
assistance of this, better strategies can be framed in order to meet the objectives. Along with this,
long term sustainability can be advanced in order to lead the business firm towards the
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impressive level of success. Along with this, improvement in the monitoring process is also one
critical aspect which allows to advance the performance. Verreynne and Meyer (2010) have
stated that by having consideration of economic measures the company can have monitoring of
activities. It is beneficial to improve the cost control which impact the overall outcome in a
positive manner and advance the profit margin ratio. By having a reference of diverse model like
supply, demand curve the company can also focus on improvement in productivity. Proper
balancing between diverse aspects related to supply and demand curve the cost of production can
be controlled. Effective control over diverse measures is beneficial to overcome issues and ensue
about profit margin ratio in desired manner. Cader and Leatherman (2011), has contended that
effective selection of marketing tool is also beneficial to improve the profit margin ratio. It has
been noticed that through a marketing number of customers can be attracted towards products
and services. It improves the sales of the company which influences directly on the profit margin
ratio. Marketing is one key method to influence the customer perception in a positive manner
which impacts the sales margin as well (Harward Business., 2013).
Döckel and Ligthelm (2015) have critically explained that improvement in measures is also
essential because it helps in effective development of operational activities. It improves the
productivity and make sure that proper support is being offered activities which are focused
towards meeting demand. It means the level of performance and sales will also be boosted in an
effective manner. Fitzgerald and et.al, (2010), has asserted that it is necessary for business firms
to make sure that responsive values are effectively managed so that objectives can be
accomplished. Along with this, consistency in the operational activities is also significant. It
helps in making sure that positive work culture is being created. By having an improved focus on
the consistency, the issues can be discussed effectively so that business can have an impressive
level of success. To increase the ROIC of the company at this stage, efficiency and productivity
improvements are typical tools of choice. It means, of having an improved focus on the diverse
factors the issue can be resolved. Headed (2010) has contended that in order to improve the
profit margin ratio, it is significant to advance the work produced. Work quality standards can
also be improved through TQM and other quality tools need to be employed by management so
that goals and objectives can be accomplished effectively. Bridge and O'Neill (2012) have stated
that ERP and other methods can also be adopted by the small businesses in order to make sure
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that profit margin is being improved. Work management can be advanced and lead the entity to
an inspiring level of achievement.
Analysis of the literature review section reflects that working of small business firm is mainly
dependent over small scale with less investment. Such kinds of businesses do not consider
complex management as critical aspect which creates a flexible working for the company. By
offering a wide scale of products and services the business firm is attaining better advantages
which allow them to contribute in UK development. Open communication is also a significant
value that allows to improve the working in the desired manner so that sustainable aspects can be
promoted. Improvement in the monitoring process is also one critical aspect which allows to
advance the performance.
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CHAPTER 3-
3.Research Methodology
3.1 Introduction
The research methodology is measured as one of most critical aspect which helps in drawing the
outcome. It is a subdivision which delivers an information with a help of varied implements and
methods. This section of study consists of tools and technique which is familiar for studies. In
addition to this, it can be said that research tools of present investigation will be discussed
effectively so that the objectives of present investigation can be accomplished in the anticipated
method (Jackson, 2010). Moreover, the current study is to study the profitability of enterprises
which operate at small and medium scale. For the better accomplishment of study, literature,
documents in respect to the subject is being taken into account. It helps to highlight the key
factors that play key role in profitability of small business organisations. In the present
investigation, interpretivism philosophy is being employed for accomplishment of objectives. In
the present investigation, descriptive design has been employed. It helps in analysing the
information more effectively so that objectives can be attained in desired manner. Primary and
secondary sources are being considered effectively to evaluate the research documents by diverse
authors.
3.2 Research Philosophy
For the effective accomplishment of the present study, the interpretivism philosophy is being
employed. It has been noticed that interpretivism philosophy is mainly dependent upon expert
belief (Khan, 2011). It also provides an ability to provide a justified outcome with respect to the
research problem. However, the selected philosophy is most appropriate for the investigation
because it assists in analysing the operations of small and medium sized enterprises. Along with
this, it also helps in making sure about numerous factors that impact profitability of small and
medium sector enterprises. In addition to this, it can be said that factors that indicates growth in
SME’s profitability are being analysed in an appropriate manner. Interpretivism philosophy also
provides a better ability to have interaction with the environment. The investigator has also been
skilled of understanding proceedings so as to brand sense of the situation (Jones and Rowley,
2011). Research philosophy is considered as a tool which allows to gain the information about
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methodology which is being employed in the investigation. It also provides a further information
regarding background of study on the basis of researcher belief. Consideration of philosophy, the
key aspects related to the study can be accomplished in desired manner. There are different kinds
of philosophies which can be employed by the researcher. Classification of philosophies can be
as interpretivism and positivism. Interpretivism philosophy is appropriate because it allows to
ensure that different factors of small business working are being explored effectively. By having
an improved focus research philosophy, the issues can be targeted in an appropriate manner.
Research philosophy has been employed by an expert with an analysis of self-belief. It also assist
in attaining better outcomes for better study. For effective application of interpretivism
philosophy the researcher has a reliability of options has also been taken into account. Social
constructions like language, consciousness, and instruments to share meaning are also being
taken into account. Interpretivism philosophy is associated with the ideal position regarding
present investigation. Philosophy in the present investigation is applied to help of social
constructivism, phenomenology, and hermeneutics approaches.
3.3 Research Approach
Research approach is method which is considered by researcher for better completion of study.
This acts as an approach for growing the rationality of social investigation. For better
accomplishment of the overall study, it is important for researcher to consider deductive
approach. With an application of deductive approach the better support can be provided for
qualitative and quantitative data analysis (Saunders. et. al., 2010). It means the statistical
outcome can be attained effectively in order to meet the objectives. The present dissertation key
aim is to analyse the profitability of enterprises which operate at small and medium scale. In
addition to this, it can be said that a better outcome can be attained effective because it allows to
make sure about the evidences present in the study. With a help of this, the researcher will be
able to make broad generalizations about the causes that impact the profitability of the
organisations (Silverman, 2010).
3.4 Research Design
The present investigation is accomplished with a help of descriptive one because the key motive
of the researcher is to explore the topic in an in-depth manner. It can be said that various growth
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indicators of SMEs profitability can be accomplished effectively (Pring, 2014). Selection of
design is one of most critical aspect for every study because it provides a blueprint of the overall
study. On the basis of such information the issue can be resolved effectively because it assist in
meeting the answers of research problem. It promotes the logical outcome and helps in analysing
the collected information. Explanatory and descriptive design is mostly employed by the
researchers for effective outcomes of the overall study. The descriptive research design is applied
in the study to understand various growth indicators of SMEs profitability. Use of descriptive
research design has assisted the investigator to recognize the wide collection of evidence about
the issues associated with reward mechanism and approaches of incentive and retention. In
addition to this, it can be stated that by having an improved focus on selection of design the
overall outcome of the study can be resolved. However, for the present investigation descriptive
design has been employed. It helps in analysing the information more effectively so that
objectives can be attained in the desired manner (Crowther and Lancaster, 2012). With an
assistance with this, appropriate ways to maximize SMEs net return in future period can be
analysed in a descriptive manner. It helps in the effective accomplishment of the objectives.
Along with this, evaluation of the operations of small and medium sized enterprises can be
attained in desired manner. Descriptive design has allowed the researcher to ensure that in-depth
information about the subject so that long term sustainability can be advanced.
3.5 Research Type
Selection of research type is also one of most precarious feature which need to be
considered in an appropriate manner. There are different forms of research type which are being
employed in investigators. Classification of research types can be as quantitative, qualitative and
case study. Qualitative research is mainly preferred by the experts while exploring the issues and
factors integrated with the subject. It provides an in-depth discussion about the subject because it
in identification of values which are associated with the outcome of designed investigation
(Singh. 2010). On the other side, quantitative research method has been employed when
statistical information is needed to be analysed. However, for the present investigation mixed
type is being adopted in order to make sure that goals and objectives can be accomplished
effectively. It assists in analyse the ways that are essential in order to improve profitability of
small business organisations. In addition to this, it can be said that mixed one has provided an
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ability to interpret the results in both qualitative and quantitative aspects so that goals and
objectives can be accomplished effectively.
3.6 Data Collection Methods
There are diverse methods of data collection which are being employed by the researcher in
order to have an effective data collection. Classification of methods can be as primary and
secondary data collection. In regard to the present dissertation, both the methods are being
employed effectively. In primary investigation questionnaire are being designed on the basis of
objectives. With an application of data collection process the reliable information can be
gathered inappropriate manner (Axinn and Pearce, 2004). It is the data that is gathered by the
investigator for meeting the designed objectives of concern study. With an improved focus on
the questionnaire the statistical information can be gathered in an appropriate manner so that
goals and objectives can be accomplished effectively. Moreover, the primary data have been
collected in such manner that desired outcome can be attained effectively for sustainable
development. It will also assist in the systematic examination of social occurrences with the help
of statistical or mathematical methods. Overall outcome of the investigation is also dependent
upon secondary information. In this respect, different sources like books, journals, online sources
are being analysed effectively. With a help of this, the subject can be determined in a suitable
method. It assists in evaluating the operations of small and medium sized enterprises (Bernard,
2011). Along with this, various growth indicators of SMEs profitability can be understood in an
appropriate manner. Moreover, information about numerous factors that impact profitability of
small and medium sector enterprises can be gathered effectively.
3.7 Research Instrument
In addition to this, it can be stated that selection of instrument is significant because it allows to
make sure that research standards are properly well maintained. It has been noticed that
following research key motive is to analyse the profitability of small and medium size enterprises
in UK. In this respect, a questionnaire is considered as an instrument so that primary data
collection can be accomplished effectively. Moreover, it has been noticed that a questionnaire has
been employed in order to understand the concept of small medium businesses and their
operations. This instrument has been used for collecting information from primary sources. The
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questionnaire consists of close ended questions. With an assistance of this, quick and effective
responses can be gathered which helps in drawing the outcome. By having an improved focus on
the questionnaire, the aspects associated with the subject can be explored in desired manner. It
helps in evaluating the operations of small and medium sized enterprises. Along with this, the
responses have also been gathered effectively in context to examination of numerous factors that
impact profitability of small and medium sector enterprises. Moreover, the comparison between
profitability and growth of medium enterprises with that of small scale enterprises can be
accomplished in desired manner.
3.8 Sampling
Sampling is considered as one of most precarious feature for every learning because it
contributes in the accomplishment of the overall study. In the present investigation, the random
sampling is being engaged by the researcher in order to ensure that sustainable values can be
attained effectively. It has been noticed that by appropriate selection of sampling the issue can be
resolved in an appropriate manner. For better achievement of the present investigation objectives
the responses have been taken from managers of small business firms. In addition to this, it can
be said that sample size of 10 managers is being taken into account for effective accomplishment
of the objectives. Selection of sampling is referred as the most essential part of the investigation
because it allows employees to have participated in the overall process. With an assistance with
this, valid and reliable evidence can be accomplished in a suitable way as it assist in meeting
goals and objectives. Sampling is beneficial to ensure that the proper gathering of information is
being considered effectively.
3.9 Data analysis
Data analysis is referred as one of most important aspect which needs to be considered by the
researcher for effective accomplishment of designing objectives. After the data gathered from
primary sources the interpretation is also one critical aspect. Data analysis is a process in which
findings of the investigation are being discussed effectively so that objectives can be attained
inappropriate manner (Collis and Hussey, 2009). It has been noticed that data can be analysed
with statistical and logical techniques so that better interpretation can be presented. As same the
classification of methods can be as qualitative and quantitative aspects.
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The present study key aim is to analyse the profitability of small and medium size enterprises in
UK. In the present investigation the qualitative and quantitative techniques of data analysis are
being considered so that growth indicators of SMEs profitability can be evaluated effectively.
The key purpose behind the quantitative analysis is to understand the operations of small
business and key factors that impact profitability of SME (Collis and Hussey, 2009). In addition
to this, it can be stated that overall outcome can be developed effectively by having an
application of SPSS so that quantitative data can be developed. With an assistance of this,
statistical information can be presented in the study so that better understanding can be
developed. Along with this, it has been noticed that help in providing an important description of
a phenomenon with a help of diverse tools. In this, graphs and tables are being presented
effectively so that outcome can be attained in an appropriate manner. Quantitative analysis
focuses on quantification of data because it helps in attaining better outcome from the overall
investigation. It also helps in drawing the results so that generalized information can be explored
in anticipated way.
3.10 Validity and Reliability
For the effective outcome of the present dissertation, application of validity and reliability
aspects is significant. It has been noticed that tools and techniques are being adopted in order to
make sure that reliable information is being selected in an appropriate manner. Validity is
considered as a factor which provide a logical and effective outcome from the study. Internal and
external validity are being considered as a critical aspect in order to meet the objectives. For the
present investigation, researcher has effectively focused towards validity and reliability of
information so that better results can be attained. In the present study, data are only gathered
from the authentic sources (Daniel and Sam, 2011). It has been noticed that only authentic
secondary sources were considered as critical aspect so that goals and objectives can be
accomplished in desired manner. Prior permission has been taken from the authors so that
authentic information can be gathered. Along with this, the latest newspaper and journals are
being accessed in order to make sure that reliable information is being gathered in order to meet
the objectives.
Moreover, the questionnaire has been designed on the basis of objectives for effective e
understanding about research problem. Responses have been taken from managers of small
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business organisations in order to ensure that correct information has been gathered for effective
accomplishment of objectives. With an improved focus on valid and reliable information the
researcher has focused on factors that indicate growth in SME’s profitability (Daniel and Sam,
2011). It has also facilitated in analysing the operations of small and medium sized enterprises.
Moreover, the information about profitability and growth of medium enterprises with that of
small scale enterprises has been gathered effectively. It helps in the effective accomplishment of
the objectives in desired manner.
Concept of reliability is also significant because if the information collected in not appropriate
according to the subject then the overall outcome might get affected. It is significant to make
sure that reliability of the data collection process is well maintained in order to accomplish
objectives.
3.11 Ethical Considerations
For better success of the study, it is important to have a promotion of ethics. By having an
improved focus on the ethical aspects, the objectives can be accomplished. Purpose and methods
are being shared effectively in order to ensure that objectives are accomplished in desired
manner. Personal information of respondents is being secreted in order to ensure that
confidentiality aspects are effectively attained which allows to meet the outcomes of the study.
Along with this, without any prior permission from scholars and respondents the information has
not been collected that also promote ethical consideration within the study (Bernard, 2011). In
addition to this, it can be said for effective collection of data the prior approval has been taken
from the researchers so that goals and objectives can be accomplished effectively. In this respect
the responses have been taken from managers of small businesses. It is one of the key reasons
that permission is being taken from employees.
Moreover, the confidentiality of member is also well maintained so that goals and objectives can
be accomplished in desired manner. Any kind of personal information about the respondent is
not shared with third party in order to make sure that sustainable opportunities are being attained
effectively. By having an improved focus on the principles of anonymity the researcher has
ensured about the key aspect of confidentiality. With an assistance of such aspects the purpose of
the investigation can be conducted in desired manner. Procedure information is also being shared
effectively with the members.
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3.12 Research limitations
In addition to this, it can be said that research limitations are considered as one of most critical
aspect because while conducting a research number of limitations are being faced by the
researcher. On present investigation, there are few limitations which impacts the effectiveness of
the overall outcome. It has been noticed that limited time is one of key limitation which impact
the overall outcome. A long process is to be followed in completing the entire dissertation, which
also takes more time. Accessing the books, journals for data collection is one of critical aspect,
but due to lack of time the data cannot be analysed in an appropriate manner. As the present
study required to be completed in the limited time. Due to lack of time the limited information is
being collected from the members who provide only limited information. It has impacted the
effectiveness of the overall outcome of the study.
Other than this, the particular study also requires an effective collection of secondary information
for better understanding of the subject. It is one of key issue for the researcher because few of
journals are available only for previous users. It is one of the key reasons that issue of the limited
information collection has influenced the overall outcome of the study.
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CHATPER 4:
4.Data Analysis
4.1 Introduction
It is a chapter in which interpretation of collected information is being presented so that issues
can be overcome. It is a section that provides an appropriate learning about the subject in a
descriptive manner. It also helps outline the outcomes of the investigation.
4.2 Findings
1. Gender:
Based on data gathered from the managers of small business organisations, it can be said that the
total number of respondents for the study was 10. It has been noticed that overall analysis
indicates that the majority of respondents are belongs to the male. It means by taking responses
from male the working and issues of small business is being discussed effectively. Along with
this, it also reflects those males are more focused towards small business firms because it
provides better job opportunities. In addition to this, it can be said that the rest of 20 percent of
respondents belongs to the female which must be considered effectively.
2. Age:
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Analysis of above table reflects that majority of respondents belongs to the age group of 25 to
35. It means the young and experienced persons are holding the power in the market which
allows to improve the work efficiency within the market. In addition to this, it can be said that
only one of respondents was from the age group of below 25. Along with this it can be stated that
2 of respondents were from the age group of 45-55. It also reflects that the age group is also
being considered as a critical aspect of the effective gathering of information.
3. Most of the respondents were owners and managers in the organisation
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On asking the participants about their position in the market, it has been noticed that most
members are at the position of an owner or a manager. In addition to this, it can be stated that 4
of the participants are the manager within the organisation and focuses on diverse aspects. With a
collective role, the operational activities of business firms are being promoted in desired manner.
Along with this, it has also been noticed that few of respondent are partners in the business. It
reflects that consideration of sample size is authentic in order to collect information effectively
so that objectives can be accomplished in desired manner.
4. Individuals are operating the UK market as a small business organisation from 1-2 years
When the respondents were asked since how long they are operating in the UK market as a small
business organisation. It has been witnessed that responses has been taken from the 10
respondents and out of which the 5 of them has stated that they are having business in the sector
for the past 1-2 years. It means businesses are set-up in the market and well aware of key
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circumstances. It has been noticed that 3 of respondents has stated that they are having
operations in the small business sector from last 1 year. It means new competitors are also
arriving the sector, which also promotes the competitive aspects effectively for the sustainable
development.
5. Change of ownership within business has been taken into account in the past three years
Has there been a
change of
ownership of the
business in the
past three years
Frequency Percent Valid Percent Cumulative Percent
Valid
Yes 8 80.0 80.0 80.0
No 2 20.0 20.0 100.0
Total 10 100.0 100.0
On asking the employees about the changes in ownership of the business in the past three years,
it has been noticed that the majority of small business organisations managers has stated that
changes are being employed. With an assistance of change in the ownership the key values of the
business have also transformed in the greater context. Along with this, out of 10 respondents the
80 percent of people have said yes, that changes in ownership of the business in the past three
years have been considered effectively. In addition to this, it can be stated that only 2 of the
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members has stated that business firm has not implemented any kind of change in context to
ownership in last three years.
6. In most of the organizations the number of employees are near 21 to 40
When the respondents were asked that how many employees are there in the organisation, it has
been noticed that most small businesses are having employees between the scale of 21-40. It
reflects that key characteristics of small business are being followed effectively from the
managers. It has been noticed that out of 10 respondents the 50 percent of businesses are having
employee between the scales of 21-40. In addition to this, it can be stated that 3 of business firms
are having an employee under 20 and only 2 businesses are having employees above 40. It
means the small businesses are having a low ratio of the workforce.
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7. Majority of businesses are focused towards functional organisational structure
On inquiring the respondents that which organisational structure is mainly employed the
businesses in order to have sustainable working. It has been noticed that the majority of
businesses is focused towards functional values. It means the roles and responsibilities are being
employed on the basis of functional aspects. Only 2 of them have stated that they are considering
divisional structure as a critical aspect of the business. It helps in work management and
improvement of operational standards. As same the 20 percent of respondents also provided a
favour for other organisational structure
.8. Number of businesses are ensuring about market conditions before involving in the
decision making process
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When the responses to the above statement were evaluated, it was found that businesses are well
focused towards ensuring about market conditions before involving in the decision making
process. It has been witnessed that out of 10 respondents the 50 percent of respondents have
stated that they are considering market conditions as a critical aspect because any kind of
changes in such aspect might influence the overall business operations. By having an improved
focus on the market needs the issues can be overcome effectively in order to lead the business
towards the impressive level of success.
9. Promotion and marketing is considered as one of essential factors which need to be
considered for establishing small medium business
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From the above analysis, it has been noticed that promotion and marketing is considered as one
of essential factors which need to be considered for establishing small medium business. By
having an improved focus on the marketing the small businesses are attracting more and more
customers so that goals and objectives can be accomplished effectively. Along with this, it has
been noticed that only 2 of the members has stated that market research is critical aspect of
sustainable development of small business firm. Moreover, the social media tools are also being
referred from businesses in order to promote the key aspects and advance sales.
10. All the factors like employment, size and market are the key characteristics of small
medium business
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As per the collected data, it can be stated that there are a number of factors which need to be
considered as a critical aspect for business in order to improve the opportunities. Classification
of factors can be as small capitalization, small market, minimum number of employees, etc.
These are also referred as characteristics of small business firm. Respondents have provided
equal support to all these factors in desired manner. It is also one of the key reasons that statistics
indicates an equal proportion of percentage under all labels.
11. Small business organisations are having stable sales of products and services
In addition to this, it has been noticed that out of 10 respondents the 5 of them has stated that
they feel that sales of products and services is stable. It means the opportunities for small
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business organisations are also stable in an appropriate manner. By having an improved focus on
the stable working the businesses are attaining better benefits. 30 percent of respondents have
stated that they are having an improvement in sales ratio because of changes in their product line.
Along with this, it has been noticed that only 2 of them has stated that they are facing issues in
regard to sales due to the high level of competition in the market.
12. Small businesses think customer involvement can be critical in few situations that helps in
development of key business aspects
From the evaluation of the data gathered in the primary data, it has been analysed that majority
of businesses tale customer involvement as a neutral value for the business. It has been noticed
that 2 of respondents has said that they are strongly agreed with the statement “Customer
involvement is critical that helps in development of small medium business”. It has also been
witnessed that only 2 of the members are in strongly disagree with the statement. It means
management need to consider customer involvement as a critical aspect in fewer circumstances.
13. Regular basis team involvement is also necessary for small medium business development
and goal accomplishment
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According to effective evaluation of responses taken, it can be stated that out of 10 respondents,
40 percent of people think percept that regular basis team involvement is also necessary for small
medium business development and goal accomplishment. By having continuous improvement in
team working the issues can be overcome effectively so that goals and objectives can be
accomplished in desired manner. Moreover, only 3 of them have stated that team involvement
does not provide competitive advantage to the business firm.
14. Digital marketing provide various benefits in context to other aspects.
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When the participants were asked about digital marketing, it has been noticed that it provides
diverse key benefits. It has been noticed that according digital marketing provides various
benefits in context to work environment and sales. It means by having an improved focus on the
digital marketing better opportunities can be designed. Moreover, 20 percent of people have
stated that market share can also be improved with an assistance of digital marketing.
15. Any small business can compete with any competitor regardless of size with a solid digital
marketing strategy.
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According to the above analysis, it can be said that any small business can compete with any
competitor regardless of size with a solid digital marketing strategy. Out of 10 respondents, the 5
of them has stated that they have agreed with the statement so that goals and objectives can be
accomplished. In addition to this, it can be said that digital marketing allows to attract more and
more customers so that sales can be advanced. It also has direct impact on the profit margin ratio
of business.
16. According to respondents, business is profitable
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It has been noticed in the evaluation that the majority of small businesses' precept that operations
is profitable. Out of 10 respondents the 40 percent of respondents who stated that they are having
profit in the market which allows to gain competitive advantage in the market. However, the
same ratio of respondents are also in favour of the disagree option. It means another 40 percent
are not having profit as per expectations.
17. Current sales is not higher than cost price
When it is asked to the respondents that does their current sales is higher than the cost price, it
has been evaluated that cost pricing is higher among business. Out of 10 respondents the 5 of
them has stated that they do not agree with the statement that current sales is higher than the cost
price. Moreover, 20 percent of the respondent’s percent that their cost and current sales are at the
same level so they cannot provide appropriate in respect to the statement.
18. Business objective is sales maximization
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It has been noticed that the majority of businesses are well focused towards sales maximization,
so that goals and objectives can be accomplished in desired manner. In addition to this, it can be
said that out of 10 respondents the 40 percent of them has stated that they are well focused
towards continuous improvement in sales. By having an improvement in market share the sales
maximization is also the key motive of businesses.
19.Rent costs are always lower as compared to sales
According to the above analysis, it can be stated that rent costs is not lower as compared to sales.
In addition to this, it can be said that out of 10 respondents the 50 percent of managers have
stated that the cost of rent is not lower as compared to sales. By having an improved focus on the
overall outcome the issues can be discussed effectively so that goals and objectives can be
accomplished. Moreover, only 2 of them has stated they are in the neutral situation.
20. Managers does not percent that business is focused towards tax on profits
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Analysis indicates that the majority of managers think that the company is not focused towards
tax on profit margin. It means company believe that profit margin ratio of organisation are
diversified which might affect the overall outcome. 6 of mangers have not provided support to
the statement.
21. Managers are agreed that business also prefer cost minimization
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Number of businesses have stated that application of cost minimization is one of most significant
aspect for every business organisation. It has been noticed that 5 of respondents has stated that
businesses are well focused towards cost minimization techniques. It helps in leading business
towards the impressive level of success.
22. Expenses of the firm are not low
Expenses of business firm are not low which impact the overall aspect. It has been witnessed that
4 of the members has stated that high expense might create an issue in regard to long term
sustainability. By having a continuous improvement in key measures the key issues can be
effectively overcome.
23. Return on sales within the organisation is at a neutral level
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According to overall study, the return on sales of the business entity can be considered on the
scale of neutral level. It is because the majority of members have stated that return on sale for the
concern organisation is above 20 percent. Return on sale can be advanced effectively by having
improvement in standards.
24. Return on equity within the organisation is at a neutral level
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The outcome of the above table reflects that return on equity of the business is above 20 percent.
It has been noticed that improvement in return on equity might be advanced through the
application of cost control system. It assists in meeting key goals and objectives.
25. The company is not facing deficiency of the funds for the development of the firm.
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According to analysis, it can be stated that the company is facing deficiency of the funds for the
development of the firm. It has been noticed that 5 of members of the overall study reflects that
lack of fund might affect the overall firm. It means consideration of such values is significant in
order to meet objectives.
26. Members are not having proper knowledge about the technical equipment’s
Members are not having proper knowledge about the technical equipment’s. In addition to this,
it can be stated that 5 of the members has stated that improper knowledge in regard to the
subject might affect the overall outcome so business firm need to ensure about it effectively.
Company need to improve the key aspect of knowledge to advance working.
27. Outdated technology does not impact the productivity
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Outdated technology does not have an impact over productivity, which need to be referred by
business firms in order to ensure about key values. It has been noticed that 5 of the members are
not agreed with the statement that outdated technology do not have an impact over productivity
28. Lack of proper channels of distribution for circulating their products might impact
performance
In addition to this, it can be stated that lack of proper channels of distribution for circulating
their products. It has been noticed that 4 of the employees stated improper distribution impact
the overall outcome of the business.
29. Employees are not highly qualified in their work which makes them inefficient in their
workings.
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Employees are not highly qualified in their work which makes them inefficient in their workings.
By having an application of high quality aspects the issues can be overcome. If such values are
not properly maintained, then it will impact the outcome. 4 of employees have stated that high
quality might create issues for the organisation.
30. Lack of raw material availability do not create barriers
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Lack of raw material impacts the overall business in diverse manners. 5 of respondents has stated
that they are not focused towards raw material protection. Such kinds of activities create a barrier
for business entities because it assists in meeting key goals and objectives.
31. Tools and techniques help in goal accomplishment
Tools and technique's application is being considered as a critical aspect for every business
entity. 4 of members has stated that the tools and techniques use allows to have improved in
work process which might lead business to critical success.
32. MIS system assist in work management
MIS is considered as one of most critical aspect which allows business firms to ensure that work
management is well maintained. In addition to this, it can be stated that 5 of the members has
said that long term sustainability can be attained effectively by having use of MIS. It also assists
in overcoming diverse issues.
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33. Business culture is well motivated
Business culture improvement allows to ensure that long term sustainability can be advanced. In
addition to this, it can be stated that 6 of the members has stated that business culture allows to
reflect that long-term sustainability can be advanced effects if employees are feeling motivated.
34. Social needs reference is beneficial for customer needs accomplishment
According to overall study, it can be asserted that social needs consideration is significant for
every business entity because it helps in meeting customer needs. 6 of members has stated that
by having social needs analysis the overall outcome in regard to customer improvement can be
effectively overcome.
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35. Employees scale is very low that improves effectiveness of recruitment process
36. Delivery of services on the time is success factor
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In addition to this, it can be stated that delivery of services is being considered as a critical aspect
for every business firm. It has been noticed that 5 of the members has stated that delivery of
services is not critical value which impact overall outcome. If such values are not considered
effectively, then it will impact overall values.
37. Gross profit margin and operating margin must be balanced
Gross profit
margin and
operating
margin must be
balanced
Frequency Percent Valid
Percent
Cumulative
Percent
Valid
Agree 6 60.0 60.0 60.0
Disagree 3 30.0 30.0 90.0
Neutral 1 10.0 10.0 100.0
Total 10 100.0 100.0
Gross profit margin is considered as a critical aspect because it allows to make sure that long
term values are being attained effectively. Only 3 of members has stated that gross profit and
operating margin imbalance will not affect the overall working of small businesses.
38. Change in organisational size
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It has been noticed that changes in organisation size are being considered as a critical aspect for
every business firm. Any kind of changes in such values impacts the overall outcome so that
long term sustainability can be controlled. 6 of members strongly agreed that change in size also
needs to be considered for organisational improvement.
39. Growth of organisation in sales and other aspects
According to overall study, it can be stated that growth of organisation in regard to sales is also
significant for every business firm. If such aspect is not well maintained, then it might affect the
overall outcome in desired manner. 6 of members has stated that they are agreed that growth of
the organisation is dependent over its sales.
40. Gross profit of company
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Gross profit is being considered as one of most critical aspect so that long term sustainability can
be attained. In addition to this, it can be stated that 6 of the members has stated that gross profit
of the company need to be evaluated effectively for sustainable development.
41. Customer satisfaction
In addition to this, it can be stated that customer satisfaction is being considered as one of most
critical aspect. According to the analysis, 6 of the members has contended that small businesses
are having effective control over customer satisfaction. It assists in meeting long term
sustainability.
42. Issues faced by business impact the profitability of the organisation
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According to the analysis, 4 of the members have stated that profitability is one critical aspect.
Any kind of changes in profitability might affect the overall outcome of the company. Another 4
by members of the study has stated that organisational issue does not have an impact on the
profit margin ratio of the firm.
43. Team building is one of critical aspect which allows to meet key objectives
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Team building is a critical aspect for every organisation which assists in meeting key goals and
objectives so that long term sustainability can be advanced effects. It has been noticed that 3 of
the members of the study reflects that team work assist in meeting key goals and objectives.
Along with this, only of member has stated that teamwork does not help in meeting objectives
and performance improvement.
44. Creating an HR strategy that aligns with this sense of open communication can improve
work stability
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Analysis of collecting information, it also indicates that creating an HR strategy is also beneficial
for businesses because it helps in dealing with issues. It has been noticed that HR strategy that
aligns the sense of communication can enhance the work stability. Out of 10 respondents the 3 of
them has stated that they are improving work performance, effectiveness by having an improved
focus on HR strategies. HR strategies allow to ensure that social and human resource aspects are
well maintained so that goals and objectives can be accomplished in desired manner. In addition
to this, it can be said that there are a number of factors which provides a better success to the
small business organisations such as business culture within organisations is well motivated. It
enhances the level of morale among members and ensure that goals and objectives are being
accomplished effectively.
45. Open communication also enhances the work productivity
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Open communication is also a significant value that allows to improve the working in the desired
manner so that sustainable aspects can be promoted. Improvement in the monitoring process is
also one critical aspect which allows to advance the performance. Numbers of respondents have
stated that they have strongly agreed with the statement. Along with this, it can be said that
monitoring allows to identify the key issues and ensure that key aspects are well maintained. It
has been noticed that when it is asked to the customers that creating an HR strategy that aligns
with this sense of open communication can improve work stability. Numbers of respondents
have stated that they have agreed with the statement. 30 of respondents have contended that long
term sustainability can be attained by the business entity through the application of open
communication.
46. Improvement in the monitoring process is also one critical aspect which allows to
advance the performance.
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In addition to this, it has been noticed that monitoring is a process that helps in analysing the
actual position of the business. Moreover, it has been noticed that application of HR strategies
enhances the morale of the work force. It improves the overall performance so that long term
sustainability can be attained effectively. Along with this, changes in key tools like policies,
standards assist in improving growth aspects. It helps in leading business firm towards the
impressive level of success. 4 of employees have also stated that any small business can compete
with any competitor regardless of size with a solid digital marketing strategy. It indicates that
small businesses can have continuous improvement in performance by having an application of
tools.
47. Balance scorecard, 360 feedback and other measures are adopted by firm for
performance management
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Along with this, it has been noticed that small business organisations are also effectively focused
towards the effective application of diverse tools in order to measure the performance. It has
been noticed that 30 percent of people stated that the balanced scorecard is one of most
significant method that allows to make sure about performance management. Moreover, the use
of 360 degree feedback is also a critical aspect which helps in analysing the performance. With
an assistance of this, diverse elements can be analysed in appropriate manner. It helps in effective
designing of strategies so that goals and objectives can be accomplished effectively.
48. Small business plays a critical role in UK development
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In addition to this, it can be said that majority of managers of different small business
organisations' precept that small business firms are having effective participation in the UK
development. It has been witnessed that out of 10 respondents the 6 of the managers has stated
that they precept that they're working plays a critical role in the economic development. By
offering a wide scale of products and services the business firm is attaining a better advantage
which allows them to contribute in UK development. For example, the advancement in sales
increases the economic aspects in a positive manner so that goals and objectives can be
accomplished in desired manner.
49. Creation of employment is key benefits of small business to society
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Out of 10 respondents the 6 of them has stated that working of small business organisations is
greatly influenced positively due to employee motivation. If employees are not motivated, then
overall productive elements cannot be employed in desired manner.
4.3 Discussion
From the above analysis, it can be said that small business firms are attaining diverse benefits
which helps in meeting key goals and objectives. Along with this, it has been noticed that the
ratio of profit margin ratio is very low as compared to other businesses. It means the financial
support in such kind of organisation is not much impressive. As same the employment ratio in
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each organisation is low, but when it is concerned with the overall employment ratio in the
nation. The enterprises is controlled by the individual himself and are being operated with less
capitalization which is invested by himself or by taking loans by the bank. It means financial
resources are being taken into account by businesses on their own risk. It has been noticed that
financial sources issue is one of critical ask for organisation Small businesses, mainly have small
market share and are not able to dominate in the operational field. It is because the lack of
competitive advantage in the market does not allow to have the effective accomplishment of
operational activities. It also reflects that by having an appropriate focus on market share
advancement the businesses can also enhance the opportunities in context to operational
activities. Further, lack of market present on internet also impacts the distribution channel
because the majority of customers prefer to take services through the website. It impacts the
marketing strength of small business and creates further issues. It decreases the sales of the
company and influences the profit margin ratio as well.
Other than this, the analysis also reflects that use of digital media tools is significant for every
business firm. By having an application of social media tools the strength can be offered to small
business promotional activities. It assists in attracting more and more employees so that long
term goals and objectives can be accomplished. Moreover, the ratio of social media use has also
advanced in present era which needs to be referred effectively from management. It has also
been noticed that businesses can have changes in its delivery system so that better services can
be offered to customers. By having an application of key tools the issues can be overcome in
desired manner. It allows to ensure that customers are attaining services in an appropriate
manner which allows to accomplish key goals and objectives. Along with this, communication is
also a significant value that allows to improve the working in the desired manner so that
sustainable aspects can be promoted. It allows to have an effective sharing of information with
members so that sustainability values can be well maintained in order to meet key goals and
objectives. Any kind of changes in services, quality and cultural values might also impact the
overall outcome of the company. It has been witnessed that working on small business is also
affected due to any kind of changes in values. Management needs to ensure about such values
effectively so that long term sustainability can be advanced effects.
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CHAPTER 5:
5.Conclusion and Recommendation
5.1 Introduction
According above analysis, both primary and secondary data analysis, it can be said that small
business firms are having continuous improvement in work style. Such kind of businesses also
holds the great contribution in context to the UK economy. Small business firms are having an
effective participation in the economic development of the UK. Along with this, a number of
small business organizations of UK are looking forward to have expansion in the services so that
the profit margin and market share can be advanced effects.
5.2 Conclusion
In small businesses, fewer employees are being employed are being appointed for working in the
company. Along with this, annual turnover of the enterprise is less as compared to the big
corporations as they are involved in performing the activities. The enterprise is controlled by the
individual himself and is being operated with less capitalization which is invested by himself or
by taking loans by the bank. The enterprise is being established on a small scale with less
investment and is involved in less number of activities. On the basis of overall outcome,
conclusive statement is that there are a number of factors which need to be referred effectively
by small businesses. Grouping of key factors can be as small management body, small
capitalization, small market share and minimum number of employees. It has been noticed that
any business firm which is reflecting such kind of elements can be referred as small business
firm.
Effective evaluation of primary and secondary data also indicates that changes in profitability
aspect are considered as a key issue which is being faced by the small business in the future
development. It means, optimistic focus on overall profit of the organisation the problems can be
overwhelmed. If level of profit is high, then strategies can be designed and employed in a
suitable way because it also enhances the investment ratio of resources. It also helps in actual
progress of the organisation so that long term goals and objectives can be accomplished in
desired manner. It has been witnessed that employees of small business organisations are not
well skilled in context to technological use. It influences the overall performance of organisation
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in a negative manner. In order to overcome such kind of issue the business firm must focus on
the training and development program. With an assistance with this, performance of the
organisation can be advanced in the critical manner so that sustainable opportunities can be
promoted. It has been noticed that enterprises mainly lack with their financial support as these
companies are owned by less number of people so the amount contributed is also limited. This
results with the deficiency of the funds for the development of the company. It also reflects that
the company faces issues in regard to loan repayment. Further, economic aspects also create an
issue in regard to pricing decision which influences the profitability in a negative manner. They
are not having sufficient funds for updating with their technology in the company. Thus, they
have worked upon the outdated technology for producing their goods. In addition to this, it is the
major drawback for the company to match up with other firms and also growing their enterprise
in the market. This also suffers with the quality and quantity of the products produced by them.
As these enterprises mainly appoint fresher’s in their enterprises so they are not highly qualified
in their work which makes them inefficient in their workings. They are not able to appoint highly
skilled people in their organization as those people are not ready to work on a lower pay scale.
Thus, there is no training session for the development of the skills and knowledge of the
employees. It has finally resulted in inefficient production of goods and services.
In addition to this, it can be said that by having continuous improvement in team working the
issues can be overcome effectively because it assist in meeting objectives. It can be said that
digital marketing allows to attract more and more customers so that sales can be advanced. It
also has a direct impact on the profit margin ratio of business. Evaluation that the majority of
small businesses' precept that operations is profitable. It has been noticed that respondents'
percent that their cost and current sales are at the same level so they cannot provide appropriate
in respect to the statement. It has been noticed that the majority of businesses are well focused
towards sales maximization, so that goals and objectives can be accomplished in desired manner.
The advancement in sales increases the economic aspects in a positive manner so that goals and
objectives can be accomplished in desired manner. Along with this, it has been noticed that small
business organisations are also effectively focused towards the effective application of diverse
tools in order to measure the performance. It has been noticed that there are a number of factors
which need to be referred effectively from the management of small business firm. Classification
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of factors can be as balanced scorecard, 360 feedback, open communication, etc. Improved focus
on the diverse measures the companies are having an analysis of the overall performance. In
addition to this, it can be said that overall issues can be identified effectively with an assistance
of 360-degree feedback. Effective consideration of social needs is also a key aspect which allows
small business firms to meet their objectives. Services offered to customers or according to their
needs which improves the sales and ensure to have advancement in the profit margin ratio.
Employees scale is very low which allows business firms to make sure that recruitment and
selection standards are well maintained. It allows to hire skilled workforce so that goals and
objectives can be accomplished in desired manner.
5.3 Recommendation
On the basis of above analysis, it can be recommended that there are a number of methods that
can be employed in order to have sustainable development in context to profitability.
Improvement in marketing using digital tools can be considered as a critical aspect. It will assist
in creating a better brand image so that goals and objectives can be accomplished in desired
manner. Moreover, the marketing innovation also needs to be refer effectively as it plays a key
role in creating better brand image. It will attract more and more customers so that sales can be
advanced effects. Advancement in sales holds a direct relationship with the profitability of an
organisation which can provide benefits to organize. With an assistance of team management,
companies can make sure that team spirit is properly maintained so that overall work
productivity can be advanced. It helps in targeting customers more effectively so that sales can
be advanced. In addition to this, it can be said that the overall profit margin ratio can also be
advanced in a critical manner. Another recommendation can be that improvement in the
monitoring process is also one critical aspect which allows to advance the performance. Such as
if the company is having appropriate monitoring of activities, and then resource allocation can be
advanced. It is beneficial to improve the cost control which impact the overall outcome in a
positive manner and advance the profit margin ratio. Moreover, consistency in the operational
activities is also significant. It helps in making sure that positive work culture is being created.
Consistency the issues can be discussed effectively so that business can have an impressive level
of success. To increase the ROIC of the company at this stage, efficiency and productivity
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improvements are typical tools of choice. It means, of having an improved focus on the diverse
factors the issue can be resolved. It assists in making sure that performance is being improved
and offering better opportunities in context to profit margin improvement.
In addition to this, it can also be recommended that further studies on small business
organisations is also beneficial because it helps in better understanding about the subject. It
assists in evaluating the key aspects effectively so that better opportunities can be identified.
Along with this, the study of the diverse methods used to improve market share in a niche market
is also a beneficial for small businesses. It is because it assists in evaluating the key methods that
can be employed by small business firms for improvement in market share. Furthermore, a study
on analysing the issues that the small business firm can face is also a critical aspect. By having
an improved focus on such study the key problems and conflict situation faced by the small
business firm can be evaluated effectively. In addition to this, it can be said that the overall
outcome of business firm can be advanced effectively through this study because it helps in
effective designing of strategy. With an assistance with this, circumstances can be advanced in a
critical manner so that issues can be overcome in desired manner.
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16. Kindly rate the following options as per below scale provided
Factor Scale
Agree Disagree Neutral
Profitability
Business is profitable
Current sales is higher
than cost price
Business objective is
sales maximization
Rent costs are always
lower as compared to
sales
Business is focused
towards tax on profits
Business also prefer
cost minimization
Expenses of firm are
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low
Return on sales is
above 20 percent
Return on assets is
above 20 percent
Return on equity is
above 20 percent
Issues faced
Company is facing
deficiency of the funds
for the development of
the firm.
Major issue which is
been faced by the small
business for the future
development
Members are not
having proper
knowledge about the
technical equipment’s
Outdated technology
impacts the
productivity
Lack of proper
channels of distribution
for circulating their
products
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Employees are not
highly qualified in their
work which makes
them inefficient in their
workings.
Lack of raw material
availability create
barriers
Growth
Tools and techniques
help in goals
accomplishment
MIS system assist in
work management
Business culture is well
motivated
Social needs reference
is beneficial for
customer needs
accomplishment
Employees scale is
very low that improves
effectiveness of
recruitment process
Delivery of services on
the time is success
factor
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Gross profit margin and
operating margin must
be balanced
Factors impact
profitability
Change in
organisational size
Growth of organisation
in sales and other
aspects
Gross profit of
company
Customer satisfaction
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26. How do you measure the business growth?
………………………………………………………………………………………………………
………………………………………………………………
27. What is your status of business?
………………………………………………………………………………………………………
………………………………………………………………
28. Are you looking for business expansion in London?
………………………………………………………………………………………………………
………………………………………………………………
29. If yes, in which area of London will you expand
………………………………………………………………………………………………………
………………………………………………………………
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