Entrepreneurship and Small Business Management - SME Assignment Sample

Entrepreneurship and Small
Business Management

INTRODUCTION...........................................................................................................................3
MAIN BODY..................................................................................................................................3
TASK 2............................................................................................................................................3
Concept of SME..........................................................................................................................3
SME impact on National, Regional, International and Social economy of UK..........................3
Impact of Brexit on political and economic factor on SME........................................................4
B. Role of SME’s and its contribution to national economy.......................................................4
TASK 3............................................................................................................................................5
1. Difference between Entrepreneur and Manager......................................................................5
2. Characteristics and skills need by entrepreneur to get success................................................6
Big Five Model:...........................................................................................................................8
Analyse either there is correlation between entrepreneurial characteristics and entrepreneurial
success through Maslow’s Pyramid.............................................................................................9
Factor that foster or hinder entrepreneurial success..................................................................10
Influence of background and experience on entrepreneur.........................................................10
CONCLUSION..............................................................................................................................11
REFERENCES..............................................................................................................................12
1

2

INTRODUCTION
Now days SME’s are playing important role in the growth of UK economy, as UK’s maximum
business are part of SME’s. SME is affected by the Brexit as UK is now not a part of EU and it
makes trade barriers. SME also impacts each region of UK as in every reason of UK it become
very important part of their economy. Croft-Simon had started business in UK named as Nom
food which is the company to produce organic popcorn and she also shares how does she makes
this new and unique product through sharing her full journey.
MAIN BODY
TASK 2
Concept of SME.
SME stands for Small Mid–Size Enterprise is that type of business in which assets, number of
employees and revenues are maintained below a particular level. There are criteria to decide that
which business will come under SME like in European Union (EU), if any business or company
is having less than 250 employees then it will be considered as SME, and in US if any business is
having employees less than 500 then it will be considered as SME.
SME covers majority of business in most of the countries. SME cover most of the GDP of every
country.
SME impact on National, Regional, International and Social economy of UK.
SME is that factor which bridge the economy of UK. Small and mid-size enterprises are those
business in UK in which employees are less than 250. SME is that thing which creates majority
of GDP in UK. SME brings great impact in UK as it has increased UK's overall productivity.
SME also brought innovation with it which help in expansion of international market, whenever
there is any innovation done by any of the SME's there is so much growth given to international
economy of UK. There are many impacts by SME to UK economy as the SME covers major part
of UK's business, as there are many businessmen who are doing businesses which come under
SME as it doesn't need high investment as compare with large business which needed high
investment. SME is also called as backbone of UK's economy. As SME helps in driving
economy through creating jobs, opening new markets etc. There are many people who invest in
SME, and they all come with new ideas and innovation, these ideas and innovation create a huge
impact on UK international economy. In 2014 one research had been conducted in which it had
3

been estimated that 99 per cent of UK's businesses come under SME. UK's government provide
full support to the new businessmen who want to start new business in UK as they know it will
help in growth of their economy. UK's economy is dividing in different parts like UK's national
economy, regional economy social economy, etc. SME contributes to each and every aspect of
UK economy like some SME which contains low investment, and some which contains high
investment so each investment boost particular economy of UK and at last it boosts overall UK's
economy. SME also help public who is living in UK as they have so many choices out there, and
they also get different types of product with different qualities. It also gives great impact to
social economy of UK each country as United Kingdom consists of four countries like England,
Scotland, etc. People of each country are different from each other, and the businessmen who are
starting SME will start according to the market they want to cover. SME is the main source to
link with other nation as when innovation comes with SME, so this innovation attracts other
countries to come and start their business by investing in them.
Impact of Brexit on political and economic factor on SME.
In easy word Brexit is known as taking out name to European Union by United Kingdom. This
Brexit has given great impact to SME. Small businesses are dealing with such situation which
they ever thought of, as the SME which are located in major urban and peripheral locations are
most concerned with coming of Brexit. There is so much impact on trade because after exit of
UK from European Union making trade difficult between UK and other European nations. As it
is an obvious thing when any nation is part of particular union at that type it is not difficult for
SME's to trade but as UK is not part of European Union so mow trading will need permission as
to deal with other union.
B. Role of SME’s and its contribution to national economy.
a. Impact of SME on England and Scotland:
SME’s are having great impact on both the reason as they are contributing so much in both the
reason, maximum income in both regions is by SME’s only, they have covered 90% of the
business of both area.
b. Impact of SME’s on Retail and Personal service industry:
4

SME’s has given growth to retail industry by 16% and to personal service industry by 17%. This
both the industry has taken good growth after expansion of SME’s, now most of the people are
investing in SME’s as they had seen good growth in it.
c. Impact of SME’s in France and Belgium:
France economy has got good impacts through expansion of SME’s and as it provide significant
contribution to France non financial business economy. In Belgium SME employment also taken
a growth of 3%, so SME has given growth to both EU countries.
TASK 3
1. Difference between Entrepreneur and Manager.
Basis Entrepreneur Manager
Risk Entrepreneur is the one who
take all the financial risk of
business as he is the one who
is owner of business.
Manger is not the one take all
financial risk as he is only
working for his salary as
employee of company.
Focus The focus of entrepreneur is to
develop its business or to
expand his business as an
owner of company his whole
focus to earn profit as much as
he can.
Manager is an employee to
company so, manager mainly
focus on smooth working and
how to do good work so that
he can earn good rewards and
promotion.
Motivation factor The main motivation factor for
entrepreneur is their
achievement as they are doing
business to achieve growth in
business as they are in
business to show something to
the world that what are they
birth for.
Main motivational factor for
manger is their growth as
employees like for example
how a manager will perform to
get growth in his job career
because they work on salary
basis, and they are just part of
company nothing more than
that.
Communication Entrepreneur can do
communication according to
his choice as he is owner of
company, and he is the one
who can decide either
employees will do formal
communication or informal
communication.
Manager is only an employee
who work on the basis of
salary, so he has to behave
formally as if he do not behave
properly then he will be
terminated from the company.
Power It’s an obvious thing that Manger is only having those
5

entrepreneur has whole power
in his hand only as he can
select either he wants any
employee or not.
power which has given to him
by its owner. If owner gives
him power that he can take
care of all HR activity, then
this will become power of
manager.
Rewards Owner gets rewards in terms
of profit.
Manager gets rewards in term
of salary, incentive, bonus etc.
Risk Owner is risk taker as they he
is one who has invested all
money in it.
Manager generally helps in
minimizing risk of owner.
2. Characteristics and skills need by entrepreneur to get success.
Characteristics needed for success:
Self-motivation: To do any work effectively and efficiently there is need of self-motivation as,
self-motivation provides energy. Nom Food owner of Croft-Simon has achieved a great height
by self-motivation. As self-motivation plays very important role in Croft-Simon's life. Nom food
is first UK companies to produce organic popcorn. Self-motivation is that force which make
people achieve goal. Self-motivation comes from the mind power that how much a person is
mentally prepared to do work without give up.( Ratten., 2016)
Risk taker: Successful entrepreneur is always a risk-taker as without taking risk there is nothing
which can achieve, as every big entrepreneur has to take high risk sometimes to achieve
something big. For example, Croft-Simon has taken so much risk in producing organic popcorn
as she doesn’t know either people will like it or not because whenever anyone launches new
product which differ from other product or having something new in it, then it contains high risk.
This risk is that factor which decides either business will get success or not, as if people doesn’t
like product then it will be a bad risk otherwise if people like it then this risk will give a way to
success.
Passion: For every person to get success passion is must have needed thing, passion provides
motivation to do work constantly, with interest. Different people have different passion like
Croft-Simon was having a passion to start business of organic food. This passion forces her to do
a business which will give new thing to public. Without passion nothing can be achieved as there
6

is nothing which will make you feel interested towards your job, or any other work which you
are not passionate of.
Disciplined: It is the most important thing which makes an entrepreneur successful. Discipline
means to do any work seriously with rules and regulation. As the people who do not do work
with discipline can’t achieve anything big in life.( Cole., 2018) Discipline provide step for getting
success. Everyone wants success in life but only few get success, this few is those who do all
their work with discipline. For example, Croft-Simon has started a new business if in this she has
to get success then she has to do all her work with discipline.
Innovation: Innovation is most important thing which help in fighting with competitors, when
customer get something new, they attract on it because they want to try that product, and if a
company constantly provide same things then people get bored from it. Innovation keeps
company up to date, as changes are always important to get growth in any field. For example
Croft-Simon has opened new firm named as Nom food in which she had innovate organic
popcorn which is her innovation and this innovation bring success.
Hard work and commitment – This character are so rare as if everyone will have this qualities
then no one will fail, hard work is must thing to get success, if success come without hard work
then also there is no happiness to get such success. Commitment means everything to success if
an entrepreneur does not follow his words then there is nothing which makes his way to success.
As Croft-Simon has done hard work and keep following her commitment and that’s how she had
opened a business on her own with a unique product.
Skills needed to get success:
Time management – Time management is most needed skill which an entrepreneur must have as
without time management there is nothing which can be achieved, entrepreneur must be punctual
of time as time is the most precious thing if time is wasted then it will waste all the things you
want to achieve.( Julien., 2018) For example Croft-Simon has started her business of Nom food, if
she had wasted time in those things which are of no use then she will not be able open her
business which she thought of, everything come with appropriate time management.
Networking ability – This skill is most needed skill to run any business successfully as in every
business you have to deal with suppliers, investors and customer and to deal with them
networking ability is must as if network is not strong then no one will like to invest or to
purchase any product from your company. For example as Croft-Simon wants to start new
7

business as Nom food and she wants that there should be people who invest in her project but if
she doesn’t have good relationship and network with people who can invest then she will not get
any investor and all thing which she want to start her business will not be available.
Leadership – This is the most important skill of entrepreneur to run any business because each
business is run by a individual who is great in leadership and thee entrepreneur with good
leadership skill can achieve success as a good leader is one who has good communication,
motivator, creative and many more other qualities. As leaders are not born they are made. So
each and every leader has to do lot of hard work to be great leader, as everyone cannot be a
leader maximum people are followers, some are only leader. So to get success, there is no
shortcut you have to hard work.( Ayandibu and Houghton., 2017)
Big Five Model:
Openness – Openness is that things which decide either a person is curious or not as the person
with high openness is quite curious, creative, and want to take new challenges and the person
who is low in openness are quietly those who dislike changes, not very imaginative, and also
does not enjoy new things. As Croft-Simon founder of Nom food is quietly high in openness
that’s why she had started new business with innovative organic popcorn, she has all the quality
of openness as she like changes and also curious to take new challenges.( Burns and Dewhurst.,
2016)
Conscientiousness – This model explain whether the person is having a high level of control or
not, and also tells the thoughtfulness and goal directed behaviour of person. Person with high
conscientiousness are those who invest their time in preparing new things, also finishes
important task right away, they are one who do all work according to set schedule and pay
attention to all details. Person with low Conscientiousness dislike to set any schedule or
structure, also make messes and do not their work properly. Croft-Simon has high
conscientiousness as she started her business with a new though in her mind, and she had taken
good time in preparing such an innovative idea.( Yan and Yan., 2016)
Extraversion – This model tell that either a person is extrovert or introvert. Extroverts are those
who like to communicate with others, they also love to be centre of attraction, also having a large
social circle and find easy to make new friends. Introverts are just opposite as they do not like to
communicate, also find difficulties in making friends, and they are not the one who starts
8

conversation first. In Croft-Simon this quality is their but she is little bit introvert also as she do
not talk extra she talks carefully as extrovert do not talk carefully they just talk without knowing
about the things, so as Croft-Simon looks like combination of both.
Agreeableness – Agreeableness tells that either person is good in trusting other or not and also
tells about the behaviour of person whether the person is kind to other or not. Person with high
agreeableness is generally take great interest in other people, and also this type of people help
other persons a lot as they are of caring nature.( Zeyen and Beckmann., 2018) Persons with low
agreeableness are generally those who do not take interest in others problem, also do not think
what other person is felling and they generally love to insult other persons. Croft-Simon is
having high agreeableness nature as she takes care of each and every person who is working or a
part of her professional or personal life, and takes care about the feelings of other person.
Neuroticism - It is that trait which describes persons by his emotional stability, moodiness and
sadness. Person with high neuroticism is generally takes so much of stress, easily get emotional,
also feels mood swing and take tension of different things. Persons with low neuroticism are
generally having control over their emotion, do not take stress and generally deal with stress
comfortably. This type of person also feel relaxed in bad situation also. Croft-Simon is low in
neuroticism as she do not worry a lot, also not feel stressed and handle all the situation with relax
mind that’s why she had started new and unique business by taking so much risk.
Analyse either there is correlation between entrepreneurial characteristics and entrepreneurial
success through Maslow’s Pyramid.
Maslow’s Pyramid tells about the needs of person which starts from bottom of pyramid with
psychological needs which tells about basic needs like food, shelter, cloth and ends with self-
actualization need in which person wants to live life as he want. ( Sarma and Borah., 2016) As
Croft-Simon an entrepreneur started her business with not having a rupee to eat as she had
invested all her money in business so she was having a characteristic to get self motivated and
not to give up that’s why she was able to survive at the starting of business, after surviving with
this factor then it’s time for her to deal with safety and security, as entrepreneur she had given all
her property as security to bank or other financial institution so that she can follow her dreams, at
that time the characteristic or quality which she needed was confidence as at that if she had
loosed the confidence then it is difficult to get over it, after that the third thing which come is
9

love and belonging so Croft-Simon had forgot all the things at that time when she was missing
her family and she had just focused over her dream at that time the quality and characteristic
which she had was control over her emotion, after that the next thing which come is self esteem
or respect at that time she had done all her work with keeping her self esteem at side and
followed her goal with 100% commitment, at that time she had characteristic of doing work with
commitment at last after so much of sacrifices and the characteristics which she had while
following her dream provide her success and now she is owner of first organic popcorn company
Nom food and that’s how entrepreneurial characteristics are co-related to entrepreneurial
success.( Burns., 2016)
Factor that foster or hinder entrepreneurial success.
Financial status – If an entrepreneur with good financial status starting a business and having a
ability to invest high amount then it will help him to handle so many difficulties of business
which occurs due to not having enough funds, so many of the time in business finance become a
big factor which foster and hinder entrepreneurial success.
Education – Education plays very important role as the entrepreneur with less knowledge cannot
handle all situation as in some situation entrepreneur fall down as not having knowledge about
the thing which is in need to run business smoothly, so education is very important as per
running business in this competitive world.
Demographic factors – Demographic factor are generally those factor which characterized about
population like sex, age, education level, etc. Demographic factors are so much important as the
entrepreneur who has having knowledge of demographic factor can make business run
effectively. These factors are so much responsible for Foster and Hinder of entrepreneur success.
Influence of background and experience on entrepreneur.
Background and experience play vital role in influencing entrepreneur as background tells about
the education, family, qualification and other such factors.( Gibson., 2017) Experience tells about
how much work does a person done till now in the same field or in other job or business.
Positive influence of background and experience:
Entrepreneur with good background and experience generally do good in business as they have
good knowledge about market and the business which they are doing. For example a person who
10

was doing job in a company of popcorn from 5 years and now wants to start his own business
then the experience which had taken earlier during job will help her to make business run much
better than inexperience person. Whereas background helps person in her education as person
who is having a background of educated family and also having business background then it will
help person a lot to do business better than the person with not having good background.
Negative influence:
Persons with good background generally are not so much hard working as they are having all
the facilities which a non background person do not have and that’s why they believe in hard
work. Experience generally not have any negative influence on entrepreneur as it is always good
to have experience but sometime if experience is bad then it become non motivation factor for
the person who want to start similar thing which he experienced early.
CONCLUSION
This report concludes that SME’s are playing great role in boosting economy of UK. There is so
much impact o SME in every region of UK and also it had provided good growth to different
industry of UK. This report also gives explanation how Brexit has affect SME’s as UK is not
now a part EU. Report tells about whole story of Croft-Simon that how she had started his new
business and how does she have a unique idea of making organic popcorn.
11

REFERENCES
Books and Journals
Burns, P. and Dewhurst, J. eds., 2016. Small business and
entrepreneurship. Macmillan International Higher Education.
Burns, P., 2016. Entrepreneurship and small business. Palgrave
Macmillan Limited.
Gibson, B., 2017. Teaching entrepreneurship and/or small business
management: shifts in content tensions in Australian Universities.
In United States Association for Small Business and
Entrepreneurship. Conference Proceedings (p. 716). United States
Association for Small Business and Entrepreneurship.
Zeyen, A. and Beckmann, M., 2018. Exploring the global potential
of social entrepreneurship and small business social responsibility
for tackling societal value creation. In Research Handbook on Small
Business Social Responsibility. Edward Elgar Publishing.
Ratten, V., 2016. Female entrepreneurship and the role of customer
knowledge development, innovation outcome expectations and
culture on intentions to start informal business
ventures. International Journal of Entrepreneurship and Small
Business, 27(2-3), pp.262-272.
Cole, R.A., 2018. Bank credit, trade credit or no credit: Evidence
from the Surveys of Small Business Finances. Trade Credit or No
Credit: Evidence from the Surveys of Small Business Finances (July
31, 2018).
Julien, P.A., 2018. The state of the art in small business and
entrepreneurship. Routledge.
Ayandibu, A.O. and Houghton, J., 2017. The role of Small and
Medium Scale Enterprise in local economic development
(LED). Journal of Business and Retail Management
Research, 11(2).
Yan, J. and Yan, L., 2016. Individual entrepreneurship, collective
entrepreneurship and innovation in small business: an empirical
study. International Entrepreneurship and Management
12

Journal, 12(4). pp.1053-1077.
Sarma, P. and Borah, B., 2016. A Study on Women
Entrepreneurship—Its Management and Business Problems: An
Overview. Journal of Art & Social Sciences. 1(1).
Schaper, M. ed., 2016. Making ecopreneurs: Developing
sustainable entrepreneurship. CRC Press.
Kuratko, D.F. and Morris, M.H., 2018. Examining the future
trajectory of entrepreneurship. Journal of Small Business
Management, 56(1). pp.11-23.
13