Entrepreneurship and Small Business Management

Entrepreneurship and Small
Business Management
1

Contents
INTRODUCTION...........................................................................................................................3
TASK 2............................................................................................................................................3
P3 Interpretation and assessment of relevant data and statistics to illustrate how micro and
small businesses impact on the economy....................................................................................3
P4 Explanation of the importance of small businesses and business start-ups with respect to
the growth of the social economy................................................................................................4
TASK 3............................................................................................................................................6
P5 Determine the characteristic traits and skills of successful entrepreneurs that differentiate
them from other business managers............................................................................................6
P6 Assessment of how the aspects of the entrepreneurial personality reflect entrepreneurial
motivation and mindset................................................................................................................7
TASK 4............................................................................................................................................8
P7 Examination with the help of using relevant examples that how background and experience
can hinder or foster entrepreneurship in an individual................................................................8
CONCLUSION................................................................................................................................9
REFERENCES..............................................................................................................................11
2

INTRODUCTION
Micro and small business are referred to business organisations with less than 50 employees
working for them. These are operated at a very small scale for personal need satisfaction of the
owner. In the following project report, an attempt is being made to analyse the importance of
small and medium organisations in UK with respect to its impact on economy and the growth of
social economy in the country. The report also aims to identify and determine the skills and traits
of entrepreneurs which helps them in their future success and growth. At last, the report aims to
evaluate with the help of examples the role of background, education and experience in
hindering or fostering entrepreneurship in an individual.
TASK 2
P3 Interpretation and assessment of relevant data and statistics to illustrate how micro and small
businesses impact on the economy.
Business organisations which are involved in production, procurement, selling and offering
a range of products and services to the customers with the number of employees not exceeding
the limit of 250 employees are termed as medium sized businesses which mainly rely on their
employees to maintain the competitive position in the industry. Resources of these organisations
are limited which makes it imperative for them achieve optimum utilisation of those limited
resources with multiple businesses (Storey, 2016). Though, small business and micro businesses
3

are limited in the resources and the number of employees which work for them but the impact
which they create on the economy is remarkable and can’t be overlooked. At the local level of
the economy, SMEs generate employment opportunities for the people and uplift the standard of
living for different communities, at the regional level people and consumers are able to get better
products made as per their requirements, at the national level these organisations increase the
rate of production and economic development in the country and at the international level, SMEs
also export goods and services to other countries and have a presence in the global business
markets. To understand and comprehend the impact which is being created by these small and
micro business on the economy of United Kingdom, it is imperative to consider the following
statistics and data related to these business organisations:
During the start of the year 2019, there were 5.9 million private sector business
organisations in the economy of United Kingdom and out of which, 5.82 million business
organisations were in the form of small businesses with less than 50 employees and 35,600
business organisations were in the form of medium-sized business with the number of employees
between 50-249. The number of large scale organisations in the country was only 7,700 which
employed more than 250 employees (Business Population Estimates For The UK And Regions,
2019). Hence, it can be observed that the most portion of the total business organisations in
private sector in UK in the year 2019 consisted of small and medium-sized business
organisations which determine their importance. The percentage of small and medium sized
business organisations in the country in the year 2016 was approximately 99.9% (Business
Population Estimates For The UK And Regions, 2016). Total number of employing business
organisations in the country out of the small and medium sized business were 1,409,950. The
number of people employed in small business organisations in UK in the year 2019 were 13.2
million which is roughly 48% of the number of people employed in the private sector. The total
number of people employed in medium-sized organisations was 3.5 million which is roughly
13% of the total. Together, the number of people employed in SMEs were 16.6 million people
which is 60% of the total. It signifies the importance and relevance of the small and medium
business for the economy of UK. The total contribution in the number of people employed in the
country by small and micro business organisations was about 15.7 million in the year 2016.
More than 2.6 million private sector business organisations were registered for VAT or PAYE in
the country. When it comes to the contribution in the turnover from private sector in the
4