Entrepreneurship and Small Business Management

This report analyzes the importance of small and medium-sized businesses in the UK economy and their impact on the growth of the social economy. It also explores the characteristic traits and skills of successful entrepreneurs and how their personality reflects their motivation and mindset. The report provides relevant data and statistics to illustrate the impact of micro and small businesses on the economy.

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

economy of UK for the year 2019, small business organisations contributed to almost £1.5
trillion which is 37% of the total turnover, medium-sized business contributed to £0.6 trillion
which is 15% of the total turnover and together small and micro industries in the economy of UK
contributed to about 52% of the total turnover (Business Population Estimates For The UK And
Regions, 2019). It can be observed from these data and figures that the small and medium-sized
enterprise in UK lay the foundation for the economic and social development of the country by
contributing massively in the employment and turnover related aspects of business organisations.
P4 Explanation of the importance of small businesses and business start-ups with respect to the
growth of the social economy.
Social economy refers to a concept which is primarily based on the objective of
entrepreneurial activities in the country for increasing the welfare of the people and fulfilling the
interest of the society at large along with meeting the needs and requirements of business owners
to earn profit and revenues (Chaves and Monzón, 2012). Importance and significance of small
and medium sized organisations in United Kingdom with respect to the growth of the social
economy is noteworthy and can’t be overlooked. The following points should be considered for
understanding and comprehending the importance of small and medium business in accelerating
the growth of social economy in the country:
Generation of employment: From the above mentioned data, it can be concluded that small
and medium sized business organisations in the country contribute to more than 60% of the
employment in the private sector which is remarkable. Generation of employment opportunities
in the country helps in improving the rate of growth of social economy as it leads to elimination
of social evils such as poverty, poor health, malnutrition etcetera. SMEs have a preference of
employing people from the local regions to have a better and positive impact on the business
territory and improve its image among the community (Blackburn, Hart and Wainwright, 2013).
Also, labour-intensive production techniques are used due to limited funds and resources which
further increases the scope of employment generations for these business organisations.
Increased revenue for the government: As a result of the increased operations and business
activities pertaining to small and medium-sized organisations in UK, the amount of revenue
generated as tax receipts for the government also increases. This also increases the pace of social
economy growth in the country as the amount collected in form of tax can be used effectively by
the country to invest into betterment and welfare of the society in the form of developmental
5

projects such as healthcare facilities, schools, parks etcetera (Brammer, Hoejmose and Marchant,
2012). More than 2.6 million business organisations in the country are registered for VAT which
provides a huge amount of additional revenue for the country.
Enhancing the standard of life: As an outcome of the increased employment generation in
the country with the help of small and medium-sized organisations, disposable income of the
population rises and allows them to consume good of better quality and increase the expenditure
on better standard of living. Adequate health care facilities can be afforded with the help of
additional employment and income (Ackermann, 2012). Thus, it helps in betterment of the
society and the welfare of the people as the standard of living improves and social upliftment
avenues are opened up.
TASK 3
P5 Determine the characteristic traits and skills of successful entrepreneurs that differentiate
them from other business managers.
It can be argued that successful entrepreneurs have some skills or characteristics or traits
which they may have developed extensively over the years or may be inherent which plays a
massive role and has a great influence on their success and growth. Some of the skills and traits
are being discussed below:
Interpersonal Skills: Successful entrepreneurs have strong and fluent interpersonal skills
such as communication skills which is very vital for articulating themselves and helps them
attract people and build a network. Having a strong set of interpersonal skills is one of the most
important trait for being a successful entrepreneur (Storr and John, 2015). For example, Ben
Jeffries is a social media influencer and a successful business entrepreneur who has a very strong
set of interpersonal skills which is very essential for him to communicate effectively with people.
Without the existence of strong communication skills, it would not have been possible for Ben to
influence people over various social media platforms.
Time-Management Skills: It is very rightly said that every person on this earth has equal
time and it depends on the time-management skills of the individual which decides his personal
growth and development (Viinikainen and et. al, 2017). For example, the fact that Ben Jeffries
has achieved so much at a young age of 23 years has a lot to do with his time-management skills
6

and he seldomly engages himself in any unproductive activity or any activity which is not
contributing in some way or the other in his personal or professional development.
Disciplined: Being disciplined is what helps succesful entrepreneurs in staying committed
towards their vision and constantly make efforts to achieve what they envision. Discipline is an
important trait of successful entrepreneurs which helps them to make constantly endeavour for
their goals and targets. For example, Guy Riese is the CEO of Up Learn and has exhibited great
discipline during his whole life which is attributable to his achievements and success as an
entrepreneur.
Far-sightedness: Successful entrepreneurs are individuals who are able to identify the long-
term consequences and impacts of any decision which is made in the present. Ability to make
decisions in the present with reference to its likely benefits and outcomes in the future is what
helps these entrepreneurs to achieve success by the execution of their business idea. For
example, Ben Jeffries determined and identified the need of a comprehensive online marketing
platform and the growth prospects of online marketing with respect to the changes in online
consumer behaviour in the near future which helped him in successful establishment of his
company Influencer.
Passionate: Willingness to put in extra efforts and remaining dedicated towards their vision
comes from a great deal of passion which succesful entrepreneurs posses. It helps them in
finding motivation for their targets (Lin and Tao, 2012). They exhibit a great deal of energy and
passion. For example, both Ben and Guy were passionate towards achieving what they
envisioned and it helped them in remaining dedicated towards their end goals and becoming
successful entrepreneurs.
P6 Assessment of how the aspects of the entrepreneurial personality reflect entrepreneurial
motivation and mindset.
Along with distinct skills, characteristics and traits owned by successful entrepreneurs,
aspects of their personality also reflect a great deal of entrepreneurial motivation and mindset
which is of utmost importance in determining their future success and growth potential. Some of
the identified aspects of entrepreneurial personality of Ben Jeffries and Guy Riese are being
discussed below to comprehend how these aspects of personality reflects their entrepreneurial
motivation and mindset:
7

Openness to experience: Successful entrepreneurs are people who are curious to learn and
try different things during their life. Having a high level of curiosity and openness to different
experiences in life help them in being creative and imaginative. Creative thinking and openness
to different ideas is a very important aspect of entrepreneurial personality which reflects the
mindset of a person to think beyond the conventional limits and norms of society (Miller, 2015).
For example, creativity helped Ben Jeffries to come up with an idea of optimally utilising the
potential of online marketing and helped him in his journey of becoming a successful
entrepreneur.
Confidence: Having confidence and a strong belief in the business idea helps an
entrepreneur to gain the trust of other people primarily the members of his organisation.
Confidence determines their strong motive and mindset to achieve what they envision and
execute their entrepreneurial idea. Both Ben Jeffries and Guy Riese were confident about their
business ideas and proposition which helped them in achieving success throughout their
entrepreneurial journey,
Competitive spirit: Entrepreneurs are people who are highly competitive and have a strong
belief in their personal competency and skills which helps them in achieving success. Successful
entrepreneurs believe that they can do anything as good as anyone else and winning for them is a
very important thing which reflects their entrepreneurial mindset and motivation.
Extrovertness: Extrovertness is a very important aspect of personality of a successful
entrepreneur which helps him to communicate with a large number of people and build strong
network and connections. Being extrovert also helps an individual to increase his engagement
and take active part in every activity surrounding him. For example, Ben Jeffries exhibits a great
deal of extrovert personality and his proactive engagement has helped him become a successful
influencer and entrepreneur.
Visionary: Having a clear vision is an aspect of personality of successful entrepreneurs
which helps them to stay committed to a cause which has no tangible results in the near future.
Profit earning and revenue maximisation is not the sole objective which helps an entrepreneur to
stay committed but having a strong belief for accomplishment of the vision is what reflects a
great deal of entrepreneurial mindset and motivation (DeNisi, 2015). For example, Guy Riese
had a vision of helping the children in getting education who are affected by illness and this
8

motivated him to create Up Learn where children can take online classes without any hindrance
in their education style even during illness.
TASK 4
P7 Examination with the help of using relevant examples that how background and experience
can hinder or foster entrepreneurship in an individual.
Ben Jeffries is a 23 year old successful entrepreneur who is the CEO and the founder of
Influencer, a social media marketing and product placement company with the help of using
influencer campaigns. He has been a person who is strongly motivated to constantly evolve
himself as an individual. Right from the initial days of his childhood, he had a strong desire to
look for possible solutions for the problems existing in his close environment. Determined to be
a successful entrepreneur, he started out his entrepreneurial journey at the age of 15 years when
he established his first company or business which was named Breeze, a clothing company. The
idea was moderately successful and laid the stepping stones for him to develop and grow as a
future entrepreneur. During his time at Breeze, he started to identify a problem where a lot of
people in his close network were having troubles reaching out and negotiating with celebrities
and people with following for running online product promotional campaigns. It led to the
emergence of an idea in his mind to build a platform which could use the inherent potential of
online marketing, influencer campaigns and advertising industry and make it easier for people to
get their products promoted through famous celebrities. During his initial year at Bath university,
he dropped out of college at the age of 18 years and founded Influencer, his second company
(About Ben Jeffries, 2019). It received massive funding and investment within first 24 hours on
Crowdcube. Influencer has provided services to clients such as Apple, McDonald’s and Alibaba
and has been a massive success for Ben Jeffries. It shows how his background and prior
experience in Breeze helped him to become a successful entrepreneur.
Guy Riese is the CEO and founder of Up Learn, a company with the objective of reinventing
the learning and education process for students who have been affected by illness through the use
of Artificial Intelligence technology and cognitive sciences. Guy Riese was very fond of
technology and innovation since his childhood and was influenced by the latest development in
the field. He started coding at the age of 12 and the age of 13 built his own web hosting internet
business and build a network of more than 5,000 customers. In the year 2013, he founded a
9

software named Event Cloud for assisting service delivery in event management companies. He
also operated as an analyst in the year 2014. He has completed his graduation from Imperial
College of London in Mechanical Engineering branch (About Guy Riese, 2019). All the previous
experiences and technical background of Guy Riese helped him found Up Learn and shaped his
future entrepreneurial journey.
On the basis of above discussion it can be concluded that prior education and background
has an important role in determining and influencing the entrepreneurial journey of an individual.
CONCLUSION
It can be concluded from the above report that small and medium sized business create a
positive impact on the economy of UK with the help of creating more employment opportunities
and increasing revenues for the government. Traits such as communication skills and time-
management skills and aspects of personality such as openness to experiences and Extrovertness
helps in differentiating successful entrepreneurs from business managers. At last, it can be
concluded from the example of Ben Jeffries and Guy Riese that background, experience and
education has an important role to play in fostering entrepreneurship in an individual.
10

REFERENCES
Books and Journals
Online
BUSINESS POPULATION ESTIMATES FOR THE UK AND REGIONS. 2016. [Online].
Available.thru<https://assets.publishing.service.gov.uk/government/uploads/system/uploads/
attachment_data/file/559219/bpe_2016_statistical_release.pdf>
BUSINESS POPULATION ESTIMATES FOR THE UK AND REGIONS. 2019. [Online].
Available.thru<https://assets.publishing.service.gov.uk/government/uploads/system/uploads/
attachment_data/file/852919/Business_Population_Estimates_for_the_UK_and_regions_-
_2019_Statistical_Release.pdf>
About Guy Riese. 2019. [Online]. Available thru <https://guyriese.co.uk/>
About Ben Jeffries. 2019. [Online]. Available thru<http://benwjeffries.com/>
11