The Impact of Small Business on Economy

The given assignment is about the impact of small business on the economy of the United Kingdom. It highlights the importance of small businesses in creating jobs, promoting local hiring, and injecting competition into stale areas. The assignment also touches upon the role of micro and small enterprises in enhancing innovation, employment opportunities, and GDP. It emphasizes the need for government support to these industries to boost economic growth.

Entrepreneursh
ip and Small
Business
Management
1

Contents
TASK 1.................................................................3
P1 Various types of entrepreneurial ventures
and how they relate to typology of
entrepreneurship................................................3
P2 Distinguish and similarities among
entrepreneurial ventures....................................7
TASK 2 ..............................................................14
P3 Interpretation of significant data and
statistics to exemplify how micro and small
business impact on the economy....................14
P4 Explicate small business & business start
ups to growth of the social economy..............19
2

TASK 1
P1 Various types of entrepreneurial
ventures and how they relate to
typology of entrepreneurship
Entrepreneurship refers to innovative
method for creation of organization of operations
by creative & effectual thoughts. This is
imperative to not to stick to particular innovation
and expand business by introducing new products
or making any kind of alterations in their
undertaking (Blackburn, Hart and Wainwright,
2013). Various entrepreneurial ventures are
provided beneath:
Small business entrepreneurship: UK has
a widespread small business ventures due to
which they have enhanced growth rate for
developing their operations. These businesses are
carried out by either owners or small number of
employees. They can either be executed by family
members or friends. Small scale entrepreneurship
can be internet cafes, auto mobile retailers and
consulting companies.
3

Scalable start-up entrepreneurship: They
emphases on creation of high quality products.
Here, entrepreneurs are confident about the
services which they are about furnish as they have
faith in their innovative idea. Primary purpose of
these organizations is to scale for which they need
to have adequate financial resources. By this, they
will able to expand their business in terms of
productivity and profitability (Bosma and et. al.,
2012).
Large company entrepreneurship: These
companies works at higher level and aims at
attaining higher level sustainability. The large
investments have been made by which products
and services can be improvised. Demands of
people goes on altering with advancement in
technologies, it leads to high competition among
people. Therefore, it is necessary to have good
position within the market; this will enable them
to maintain their position by transforming ideas
into reality.
Social entrepreneurship: Entrepreneurs
are responsible for creating innovative services
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and products for betterment of society.
Entrepreneurs within this venture formulate and
execute their ideas into trenchant services through
which progressing working culture can be created
for their betterment.
Typologies:
Topology refers to analysis of different
aspects with respect to specific types like
classification on the basis of form, plan, structure
and style. They are illustrated beneath with
respect to entrepreneurship:
Survival Ventures: Activities which are
associated with accomplishment of basic
requirements (Bridge and O'Neill, 2012). In this
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venture firms are not registered, and they do not
carry any kind of operation within business
premises. Operations are furnished through usage
of restricted raw material along with this there is
no relation with banks. Basically they small
entities.
Lifestyle Ventures: They have been
formulated for achieving higher productivity
through which revenue can be improvised. They
comprises of small as well as finite number of
staff who are responsible for producing end
products.
Managed Growth Ventures: Here,
business focus on attaining stability as well as
expansion of services in sturdy way and shifting
their services in other regions. For this, they
recruit new employees and launch their fresh
products along with services through usage of
creative thoughts (Choi and Majumdar, 2014).
Aggressive Growth Ventures: Here
business emphases on innovation carried out by
usage of technology. They generate their funds
through stake capital by which venture can have
higher productivity. Their goal is to take venture
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into national as well international market. This
will provide them high growth as well as they can
generate more revenue. These include large scale
enterprises (Chrisman and et. al., 2012).
P2 Distinguish and similarities among
entrepreneurial ventures
They are illustrated below:
Enterprise
s
Similari
ties
Differ
ences
Lifestyle and
survival
Entrepreneuri
al Venture
They both
conduct their
everyday
operations with
an aim to earn
high profits and
have a
sustainable
growth within
the market
(Fassin, Van
Rossem and
Buelens, 2011).
Furthermore,
Within lifestyle
venture
entrepreneurs
execute
operations as
per their
passion and
interests. Their
entire business
runs based on
their field of
interest. They
include,
fashion and
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these ventures
aim to create
high end
goodwill within
market.
travel bloggers.
Whereas in
survival
venture
business
activities are
carried out in
such a way that
they can
sustain in a
marketplace .
(Drucker,
2014).
Social v/s
Scalable
Enterprise
 In both
social as
well as
scalable
enterprise
s, entities
are
involved
in process
of
creation
 Entrepr
eneurs
within
scalable
enterpri
se
conduct
their
daily
operatio
ns with
8

of wide
range of
new
products
and
services
which are
designed
by
making
use of
innovativ
e ideas.
By this,
they are
able to
serve
their
customer
s in best
possible
way.
 Both of
these
entrepren
respect
to
satisfy
their
custome
rs
through
which
they can
enhance
the
probabil
ity of
enterpri
se.
Wherea
s
entrepre
neurs
within
social
enterpri
se carry
out their
busines
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eurs aim
at
expandin
g their
business
and
possess
wide
consumer
s.
(Decker
and et.
al.,
2014).
s
function
s in
such a
way
that
they can
handle
issues
which
are
being
faced
by
individu
als.
 Social
enterpri
ses
perform
their
activitie
s in an
formati
ve
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manner
with an
aim to
furnish
welfare
services
to their
custome
rs.
While
scalable
enterpri
ses
carry
out their
busines
s
operatio
ns with
their
focus to
offer
innovati
ve and
trencha
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nt
services
to their
potentia
l
custome
rs.
Small v/s
Large Business
enterprise
 They
both
conduct
their
everyday
activities
in such a
manner
that they
furnish
best
services
and
products
by which
they can
attain
 Small
firms
busines
s
dealings
in
localise
d as
well as
domesti
c
market
whereas
large
scale
enterpri
ses
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their
targets as
well as
objective
s in
required
manner.
 Small and
large
scale
organizati
ons carry
out their
operation
s and
functions
by
rendering
best
benefits
to their
customer
s by
making
sure that
render
their
services
within
national
and
internati
onal
market.
Suitable
demarcation
within small-
and large-scale
enterprises can
be made by
analysing
financial
conditions.
Like large scale
carry out their
operations with
large funds
through which
they conduct
their operations
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their
demands
and needs
in
accompli
shed in
best
possible
manner.
and functions.
But on the
other hand,
entities in small
enterprises
conduct their
business
operations by
making
effective use of
resources as
they have
usually limited
resources and
capital
(Chrisman and
et. al., 2012).
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TASK 2
P3 Interpretation of significant data and
statistics to exemplify how micro and
small business impact on the economy
Small & micro organizations are one of
the most crucial part of an economy within
country. As per reports which were published
within UK, it was found that micro and small
organisations have made strong contribution in
enhancing economy of country which is nearby
87%. Within UK, around 4.1 billion such kind of
organisations exist which assist them to render
their services and leads to growth within economy
(Decker and et. al., 2014). By this, GDP of UK
has been intensified by around 6.1%. Apart from
this, these types of organisation creates high rate
of job opportunities.
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(Source: Impact of Economy on UK, 2016)
After analyzing shown plot it has been
found that, Brexit has created strong impact on
market in affirmative manner within market of
UK. This will lead to growth of 88.2% and with
respect to GLLCP, they have expanded more than
0.6%. From this, it can be concluded that
economy of country has both affirmative as well
as pessimistic impact.
Brexit was exit of Britain from European Union.
In this, each individual has voted in favour of exit
and this number was around 51.9%. In Wales and
England, nearby 53.4% to around 52.5% have
voted in the favour of Brexit (Fassin, Van Rossem
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and Buelens, 2011). In Northern Ireland and
Scotland, people have voted that they (Britain)
should remain within EU. From then, negotiation
process has been continued to agree with EU and
UK.
This result has great impact on economy
of country. Factors such as reduction in currency
rates and decline in inflation rate have been
critically impacted on UK. For avoiding this
situation, idea of small enterprise will assist
entrepreneurs for enhance economy of country.
This leads them to render different employment
opportunities which aids in maintain high living
standards of people which contributes in
improving GDP for country. With respect to this,
big firms completely depends on small business
for emphasizing on development of start-ups as
well as small business by which entrepreneur can
enhance outsourcing process. As a result of this,
government renders facilitates to organisations by
furnishing different perks by which they can
create enhancement in their growth process and
this have significant impact on economy of
country. Small and micro business assists in
invention of creative and innovative services by
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which GDP has been improvised to 6.0%. Thus, it
is mandatory for government of UK to render
some benefits to these industries so that they can
enhance the economy of country in effectual
manner. Government needs to assist new
entrepreneur to enhance opportunities and
eradicate poverty from the country. They are
mentioned below:
Share of business in United Kingdom:
There exists various large as well as small
business units that aid them in growing economy
in effectual way. These sectors almost provide
approximately 1.5 opportunities for international,
national, localized and government people within
UK. Furthermore, this will enable to acquire
foreign currencies which will enhance economic
system of nation in appropriate & effectual way
(Drucker, 2014).
Contribution to Innovation: Micro and
small organization brings conception as well as
new ideas by which they can attract more
customers. These units aims at furnishing superior
services other sectors for completion of
manufacturing process. It lead to steady frugality,
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improvisation in living standards and
enhancements in job opportunities.
In context of United Kingdom, these
companies contributes within improvisation of
revenue and economy. Furthermore, it has been
analysed that various jobs has been provided by
small organisations which leads in enhancement
of efficiency of UK.
P4 Explicate small business & business
start ups to growth of the social
economy
Small business renders enhanced great
value in economy of organisation. They are
mentioned below:
 Competition: The small businesses injects
enhanced competition within stale areas.
An example can be taken into
consideration like a local farmer can
produce services at cheap but an agile
business can make use of innovative
technology so that better results can be
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attained. This will lead to alterations in
behaviour as well as thinking.
 Local hiring: Small businesses operate
locally so they highly prefer to hire local
people this given individuals an
opportunity by which they can have career
options. There drives new job growth in
region where small businesses are more
powerful.
 Diversity: Small businesses provide more
flexibility and can be initiated by anyone,
this makes them diverse in terms of
culture, functionality, form and have more
potential as compared to large
organisations. This provides greater
diversity within economy.
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