Benefits of New Business Ventures for Economy

This assignment discusses the positive impact of new business ventures on the economy, including job creation, high cash flows, and better infrastructure. It highlights the importance of small businesses in boosting local and regional economic growth rates and contributing to the nation's GDP growth rate. The assignment also emphasizes the need for entrepreneurs to possess effective skills and characteristics to start successful business activities.

Entrepreneurship and Small
Business Management

Table of Contents
INTRODUCTION...........................................................................................................................1
TASK 1 ...........................................................................................................................................1
P1. Different types of entrepreneurial ventures and different types of entrepreneurship
typologies....................................................................................................................................1
P2 Similarities and difference between entrepreneurial ventures...............................................2
M1 ..............................................................................................................................................3
D1 ...............................................................................................................................................3
TASK 2............................................................................................................................................3
P3 Impact of micro and small business on economy..................................................................3
P4 Importance of small businesses and starts-ups in growth of social economy........................5
M2 ..............................................................................................................................................5
D2 ...............................................................................................................................................5
CONCLUSION................................................................................................................................5
REFERENCES................................................................................................................................6
.........................................................................................................................................................6

INTRODUCTION
Entrepreneurship is considered as the capacity and willingness of the person to organise
and develop new business venture to earn large number of profits. The persons who took risk and
start such new business functions called entrepreneur. Large number of qualities and skills are
required to become successful entrepreneur. Such entrepreneurial activities provides large
number of benefits in development of economy and society of country (Barringer, 2012).
In the present report explain about, different types of entrepreneurial ventures and their
relation to the typologies of entrepreneurship, similarities and differences between
entrepreneurial ventures. Also, contribution of small and micro business activities on economy
and importance of small-business and starts-ups in the growth of social economy.
TASK 1
P1. Different types of entrepreneurial ventures and different types of entrepreneurship typologies
Entrepreneurship: This includes the starting of new business activities by using their
innovative ideas to earn large number of profits. It can also be said as combination of various
resources like land, labour, capital to establish new venture. To make the venture successful
depends upon the qualities and skills posses by entrepreneur.
Different types of entrepreneurial ventures
Large number of options are available in front of the individuals regarding opening of the
different types of ventures. It depends upon the skills of entrepreneur that which venture they
select to start. So, such different types of ventures are define below:
 Scalable starts-ups entrepreneurship: Such kind of ventures are start by such persons
which are having the vision from day one to change the world. The amount of risk
involved in these business ventures is high. To provide finance to such ventures needs to
find out crazy investors which are ready to take risks.
 Small-business entrepreneurship: All such ventures which are having employees less
than 50 and having the turnover of less then 6.5 million are considered as small business.
The major small business which are operating in UK are travel agents, hairdressers etc.
 Social entrepreneurship: The main aim of these kind of ventures is to create such kind
of products and services which helps in removal of the social needs. They provide their
functions to make the world better place to live.
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 Large company entrepreneurship: These kind of venture requires large number of
capital and risk to start their business activities. To make these kind of ventures
successful need to adopt innovative technologies, ideas, legislations etc.
Typologies of entrepreneurship
 Serial entrepreneur: Such kind of entrepreneurs have new and innovative ideas to start
their business operations. They take part in all the activities of organisation which are
done on regular basis.
 Female entrepreneur: All the business ventures which are controlled by females are
called female entrepreneurs.
P2 Similarities and difference between entrepreneurial ventures
It is observed that large number of entrepreneurial ventures are provide their business
functions in UK. This will represent many similarities and difference among different
entrepreneurial ventures which are mentioned below:
Life style entrepreneurs and serial entrepreneurs: The major similarities between both
the entrepreneurs is that they provide their full emphasis on improvement of productivity and
profitability. Another similarity between both the entrepreneurs that having same kind of skills
and traits. The major difference between two entrepreneurs is that serial entrepreneurs have
innovative ideas ideas to start their new business activities. They have full belief on their
assumptions that their ideas will helps in accomplishment of their targets. On other hand,
Lifestyle entrepreneur use their actual efforts to develop their products in market (Baum, Frese
and Baron, 2014).
Small and large entrepreneurs: The major similarity between both these entrepreneurs
is that they are working for the satisfaction of their personal and customers needs which helps in
development of society. But there are large number of difference are present in both these
entrepreneurial ventures. The risk involved in small business venture is very less in comparison
to large business ventures. There is huge difference also present in the amount of capital required
in the operation of business activities of both the ventures.
Female and male entrepreneurs: The similarities which are present in both kind of
entrepreneurs is having equal skills and qualities which makes them successful in market. The
only difference which is present between both these entrepreneurs is among their market share.
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Female entrepreneurs hold 51% of market share and male entrepreneurs hold 49% of market
share.
Private and joint entrepreneurs: The similarities between both the entrepreneurs is that
large number of individuals join each other to accomplish their common objectives and targets.
The difference which is exist between both these entrepreneurs is mentioned below:
Private entrepreneur includes the agreement between two or more person to run their business
activities to earn large number of profits. Joint entrepreneur means the joining of hand of
different parties to accomplish some common objectives by exchange of technologies, personnel
and know how.
M1
Entrepreneur ventures are used in both public and private sector. It is a state of starting a
new business entity, planning and resourcing to develop the structure of business. Only risk
factor distinguish between public and private entrepreneur. In public sector risk remain
associated in the hands of government and in private sector risk remain associated in the hands of
owner (Bosma and Levie, 2010).
D1
There are huge chances of growth and development found in small business enterprise.
Small entities need huge amount of investment and financial help to grow the business. There is
also lake of legal procedures and policies regarding entrepreneurial ventures. It helps in respect
of growth and development.
TASK 2
P3 Impact of micro and small business on economy
Micro: In Micro business the number of employees are required to be less than 10 and
also having the turnover under £ 2 million. The business activities are much smaller in
comparison to small and medium.
Small: In small business the number of employees are required to be less than 50 and
having the turnover which is not exceed £ 6.5 million.
Medium: In medium-sized business the number of employees are required to be less
than 250 and the turnover should be less than £ 25.9 million.
Difference between private, sole proprietorship and partnership
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Private enterprise: It includes such enterprises which are owned and controlled by
private person. On the business activities of such enterprises government has no control. The
main aim of such enterprise is to earn large number of profits. The basic features are mentioned
below:
 Separate legal entity
 They are prohibited to invite public to subscribe their share
 Main objective is to earn profit
 Owned and managed by private individuals
Sole proprietorship: On such kind of businesses only single person has full control
(Bruton, Ahlstrom and Li, 2010). This person has unlimited liability. Features are mentioned
below:
 Having unlimited liability
 Owned by single person
 Not separate legal entity
Partnership firm: These kind of firms are formed by the agreement between the two or
more parties to achieve common objectives and earn large number of profits. Features are
mentioned below:
 All partners have unlimited liability
 Equal profit and loss sharing ratio
 Common objectives
 Agreement between the parties
Impact of micro and small-business on growth of economy
 Employment opportunities: Due to having large number of small business activities in
UK, huge employment opportunities are provided to the individuals of society. Almost
50% of population are employed under micro and small businesses.
 Development of infrastructure: These kind businesses has huge contribution in the
development of basic infrastructure in regional areas. This helps in improvement of living
standards of individual.
 Improved cash flow: Such business activities are considered as high attraction factor for
the foreign investors to invest their money is business operations. This will brings large
amount of cash in an economy in form of FDI and Taxes also.
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P4 Importance of small businesses and starts-ups in growth of social economy
Brexit: It is the situation which arises due to the exit of Britain from European Union.
This will results in depression in industrial sector in UK. Large number of impact are noticed on
exports and imports. To overcome from this situation, Government of UK provides support to
the individuals to start their own business activities and and give contribution in development of
economy.
Importance of small business and starts-ups in development of social economy
 Improvement in social security: After Brexit, government has large control over the
functions of industries operating in UK. Regulations and legislations are provide by
government which provide more security to industries (Dacin, Dacin and Matear, 2010).
 Financial support: After Brexit, large number of small businesses are start their
operation in UK. This will increase financial support to government in form of taxes and
high cash flows.
M2
Contribution of small, medium and large organisation depends upon their revenue
structure and organisational type. Small and medium organisation assist the economy of nation
and enhance the GDP growth rate whereas large entities provide employment conditions.
D2
Small business entities provides employment opportunities and growth opportunities to
local and regional level. It also helps to enhance the growth rate of GDP rate which also boost
the standard of economy.
CONCLUSION
It has been concluded from the above report that, new business ventures provides large
number of opportunities regarding development of the society and economy. To start successful
business activities entrepreneurs are required to have effective skills and characteristics. The
large number of benefits which are arrived by nation and society are employment, high cash floe,
better infrastructure etc.
REFERENCES
Books and Journals
Barringer, B., 2012. Entrepreneurship: Successfully Launching New Ventures, (2012).
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Baum, J. R., Frese, M. and Baron, R. A. Eds., 2014. The psychology of entrepreneurship.
Psychology Press.
Bosma, N. S. and Levie, J., 2010. Global Entrepreneurship Monitor 2009 Executive Report.
Bruton, G. D., Ahlstrom, D. and Li, H. L., 2010. Institutional theory and entrepreneurship: where
are we now and where do we need to move in the future?. Entrepreneurship theory and
practice. 34(3). pp.421-440.
Dacin, P. A., Dacin, M. T. and Matear, M., 2010. Social entrepreneurship: Why we don't need a
new theory and how we move forward from here. The academy of management
perspectives. 24(3). pp.37-57.
Defourny, J. and Nyssens, M., 2010. Conceptions of social enterprise and social
entrepreneurship in Europe and the United States: Convergences and divergences.
Journal of social entrepreneurship. 1(1). pp.32-53.
Delgado, M., Porter, M. E. and Stern, S., 2010. Clusters and entrepreneurship. Journal of
economic geography. 10(4). pp.495-518.
George, G. and Bock, A. J., 2011. The business model in practice and its implications for
entrepreneurship research. Entrepreneurship theory and practice. 35(1). pp.83-111.
Hall, J. K., Daneke, G. A. and Lenox, M. J., 2010. Sustainable development and
entrepreneurship: Past contributions and future directions. Journal of Business
Venturing. 25(5). pp.439-448.
Herrington, M., Kew, J., and Monitor, G. E., 2010. Tracking entrepreneurship in South Africa: A
GEM perspective. South Africa: Graduate School of Business, University of Cape
Town.
Online
Impact of small-business in UK economy.2017.[Online].Available
through:<http://smallbusiness.chron.com/important-small-businesses-local-economies-
5251.html>
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