Importance of Small Businesses and Start-ups in Social Economy

Small businesses and start-ups are important for the growth of the social economy. They provide job opportunities, enhance living standards, contribute to the GDP, and pay taxes. This article discusses the impact of small businesses and start-ups on the economy and highlights their significance in the development of the country.

UNIT 9
ENTREPRENEURSHIP AND
SMALL BUSINESS
MANAGEMENT

Table of Contents
Different types of entrepreneurial ventures and relate with the typology of entrepreneurship ....................................4
Similarities and differences between entrepreneurial ventures ......................................................................................5
Interpret and assess data and statistics to micro and small businesses impact on economy............................................6
Explain importance of small businesses and businesses start-ups to growth of social economy.....................................8
Determine characteristic traits and skills of successful entrepreneurs that differentiate them from other business
manager ...........................................................................................................................................................................9
Assess how aspects of entrepreneurial personality reflect entrepreneurial motivation and mindset...........................10
Using relevant example how background and experience can hinder and foster entrepreneurship.............................11
REFERENCES ....................................................................................................................................................................... 13

Entrepreneurship and small business management is an important source of earning high amount of
profits and revenues and also benefitted the economy of the country. In this a person having lots of skills and
knowledge to start a small business and become a large organisation so that they can enhance our economy and
removing poverty by encouraging prosperity. Entrepreneurship is called the backbone of an enterprise that
provides job opportunity and satisfies the needs of the customers. this project is related to various range of
entrepreneurship that also includes typology of entrepreneurship. it also inculcates the impact of small
businesses in the economy and how start-up businesses encourage growth and economy of the economy. it also
suggest the various aspects that set the mind of an entrepreneurial to become a successful in their vision. at last
it includes the different environment that can show the foster and hinder the entrepreneurship(Burns, 2016).
Different types of entrepreneurial ventures and relate with the typology of entrepreneurship
Entrepreneurship- It defines the essential framework that helps in enhancing the value of the person
and their profitability. It helps in managing and developing the business entity to gain the profits by taking the
risk in the competitive world so that firm may fix their sustainability for a longer period of time. They cab set
their own standards on operating the business and deals with the large number of obstacles. This concept is
related to various aspect that is intrapreneurs, owner-manager and the serial entrepreneur. In this serial
entrepreneurial are always come up with the innovative and creative ideas so that they earns a high amount of
profits. In this entrepreneurs are also acts as an entrepreneurs who can handle all the working aspects in the
organization. In this owners managers are the one who can keep all the description and update in the
departments and also answerable to the same. It includes various types of entrepreneurship that can be shown
below(Burns and Dewhurst, 2016).
Entrepreneurial activity- It defines the term related to individual behavior in which value can be
operated by the business by creating the various economic framework that can presented with the innovative
ideas. In this ideas can be mould into the reality by benefitting the customers so that company can enhance their
profits. it also provides the creatively and employment opportunity in the country. It can be included different
types of entrepreneurial ventures that can be shown below.
Types of entrepreneurial ventures
 Small entrepreneurship- It defines that business venture that is owned and operated by an individual
person and in this there is mo major competition they face. They sell their products and services in the
local market with a small amount of capital and resources. It mainly earns a profit of less than € 2
million, where they give the employment opportunity to the small number of people i.e. less than 50
employees. It includes Eletotech ltd, as a example of small enterprise(Dana, 2018).

 large entrepreneurship- It refers to that type of organisation that are mainly focus on satisfying the
customers demands by offering them innovative goods and services as per their taste and values that
also helps in beating the competition in the market. They also provide large amount of employment
opportunity to the large area people and they are working for longer sustainability in the market.
Examples are Google, Tesco, M&S etc.
 Social entrepreneurship- It refers to those ventures which are designed to solve the problem of the
society and creating the products and services as per the welfare of the society people. They are majorly
working for making the society a better in t5he world rather than earning profits and revenues.
Examples of social entrepreneurship children trust(Ratten, 2016).
Typology of entrepreneurship
This term represents the classification of the different entrepreneurship on their particular basis. It helps
the economy of country and society to enhance their growth with the distinct features of the business operations
and in this some of the typologies of entrepreneurship can be described below.
 Lifestyle enterprise- This aspect of typology of entrepreneurship represents that entrepreneurs are
operated their enterprise for enhancing their living standards and providing the varieties of opportunities
to the local people in the form of their welfare, employment etc. so that it also affected the economy of
the country and enhance the sustainability of the business. They are basically related to the small and
social enterprise.
 Growth enterprise- This type of entrepreneurial typology can enhance their profits and growth with
their innovative ideas in their product offerings that can satisfy the needs of the customers. it can
involves the large enterprises that can working for gaining the competitive advantage and the growth of
the company(Laudano, Marzi and Caputo, 2018).
Similarities and differences between entrepreneurial ventures
Difference between entrepreneurial ventures
Basis- features
large company- In context of large enterprise they invest more money in the resources and capital and also
contain more government invention in their operations.
small company- It does not contain more investment and resources with limited government intervention in the
regular operations.

social entrepreneurship- In this type of business they contain resources as per the society welfare with the
involvement of the government.
Basis- Objectives
large company- The main objective of large organisation is to earn high amount of profit by satisfying the
needs of the customers by providing goods and services(Julien, 2018).
small company- The main objective of small type of organization is that they can earn profits for feeding their
immediate family members and maintaining their livelihood within the society.
social entrepreneurship- They are working for welfare of the society in a primary mode and secondly they
think to earn profits by fulfilling and solving the needs of the people.
Basis- Scale
large company- Large organization is operated their business entity on the large scale and due to this they can
accept the challenge and risk on the high amount to sustaining in the marketplace.
small company- In small enterprise they can operate their business enterprise on the small unit scale due to this
they can have small risk and capital to sustain in the market.
social entrepreneurship- Social enterprise are operated and generated their business unit on local level so that
they can fulfills the needs and demands of the people by proving unique solution.
Similarities between entrepreneurial businesses
Basis- fulfilling demands
Large enterprise- In large organisation they can fulfills the d3emands of customers by providing the designed
products for earning more profits.
small ventures- In this enterprise can focus on fulfilling the demands of the local area people by providing
unique goods so that they can earn high profits(Anderson and Gaddefors, 2016).
social enterprise- This enterprise is designed to fulfilling the needs of customers by solving their issues in a
society that helps in gaining sustainability.
Basis- Society uplifting
Large enterprise- This enterprise is uplifting the society by providing job opportunity to the large number of
peoples.

small ventures- This venture is giving the better opportunity for employment in the local market.
social enterprise- This type of business entity is providing the opportunity for improving the living standards of
people.
Basis- Profits earning
Large enterprise- They are working for earning higher profits and revenues.
small ventures- They are working for earning profits on small amount.
social enterprise- They are also working for earning profits by fulfilling the needs of society.
Interpret and assess data and statistics to micro and small businesses impact on economy
To enhance the economy of the country business organisation is playing a major role and contribute
more in the form of enhancing the infrastructure. In this every type of enterprise in the country impact the
economy in a positive way. Small and medium size business can provideing the 3/5 employment to the overall
employment in the country with the profits of £ 2.2 trillion. In this most SME firms in the country like UK are
involved in the retail sector that will create positive impact on the overall society. In UK small and micro
business organisation p[lay an essential role and place a great impact on the economy that can be shown below.
 Small business- This type of enterprise are contributing small part as they provide employment to the
less than 50 workers and working for earning the revenues which are limited to €2 million. due to small
structure they can provide employment to the local area people and enhance their revenues by satisfying
the customers of the local area people where the business is operated. on small scale they can benefit on
the major scale economy. In UK as in 2019 there are almost 5.82 businesses that coversn the 99% in the
business environment of the country like eggfree bakery and plumber is design as a small business in the
UK (Piperopoulos and Dimov, 2015).
 Medium enterprise- It represents those type of enterprises which are working with more than 50
workers but less than the 250 employees with the total number of revenues that is hold between the €5
million to €22 million. this type of organisation provide the employment to the workers so that they can
enhance their living standard and spend more on buying the goods and services. they are working for
fulfilling the demands of the customers in the prominent manner so that they can sustain in the market
for a large number of period and beating the completion with their innovation in product.
 large company- This type of entrepreneurial venture are working for satisfying the needs of the
customers with the approximately more than 250 employees and operates their business on the large
scale with the income of €22 million or more. This types of ventures are done their operations on the

global nature and providing the large base of employment to the unemployed people this is majorly
impact the economy because they can enhance the large people living standards and their buying
power(Talebi, Rezazadeh and Najmabadi, 2015).
Impact of small and medium enterprise on economy
Illustration 1: source- UK SME Data, Stats & Charts
In UK there are 99.3% business are considered as a small firms that creates 48% employment in the
country due to this living standard of the people will be enhanced with a 33% of the annual turnover according
to this graph.
Figure 1- Objectives of small and medium size businesses in the country's economy
 Local level impact- small and medium enterprise may impact the local region because in this they can
provide the goods and services as per the customer’s needs where people in local area are purchase the
offerings as per their prescribed needs. this also helps in enhancing the living standard of the local
people due to this their spending power on the varieties of goods may enhance also and this will
develops the economy of the country.
 National level impact- Due to operating the business of small and medium size organisation it will
ultimately impact the economy of the nation because they can provide employment opportunity due to
this purchasing power of customers may enhance and this will also help in taking the tax because
organisastion may earn high amount of profits and revenues. In this they can provide innovative goods
and services which may helps in globally dealing the products and services due to this national economy
will earn the foreign currency which is the major part of enhancing the economy of country(Volery and
Mazzarol, 2015).
 Regional level impact- On regional or state level small and medium size organisation may impact
positively as by enhancing the livelihood of the people in the society by eliminating the problem of the

unemployment. it also helps in enhancing and encouraging the morale of people that they working for
enhancing the profits with the supports of government invention and increase the economy of country.
Explain importance of small businesses and businesses start-ups to growth of social economy
Small businesses and start-up businesses presented as a benefits to the country people and economy
because they helps in the enhancement of the GDP and the currency of the country. It contains the significant
right to the people to provide the employment for completing their task and objectives for satisfying the
customers and gaining the competition in the marketplace. In case of UK small and start-up businesses are
presented as a major part because they majorly contribute in the development of the country’s economy. Due to
this small and scale- up business get full supports to the government. it can includes various importance of
small and start-up businesses that can be shown below. Social economy defines as the rich diversification in the
number of firms that was operated in the country for the betterment of the society and increasing the GDP of the
country. It is an integration of all the varieties of the business in this small and start-ups businesses play and
major role in performing the goals and activities. In this SME play an essential role in developing the standard
of living within the society with their innovative thoughts that will entertained the people to buy this. In this
small and start-up business can also contributes in paying the taxes that will enhance the GDP of the nation.
 Job opportunity- it is the major benefit of the small and scale up businesses that they can provide
variety of employment opportunity to the number of people as per their skills and knowledge that helps
in enhancing the living standards of the people. In start-up businesses they can provide quality and
innovative products to their customers so that business may enjoy large profits and sustainability this
will helps in paying the tax in an appropriate way(Hosseininia and Ramezani, 2016).
 Living standard of people- small and start-up businesses may create a great importance on enhancing
the living standards of the people by providing the quality goods at reasonable price and giving them
employment opportunity to the unemployed person so that they can enjoy their saving in purchasing the
goods and services as per their wants. due to this there image in the society will increases.
 Growth of the economy of country- it is another major importance of the small and scale up businesses
as they can enhance the growth of the economy by earning higher revenues and profits by selling their
offerings to their customers and due to this they can pay the appropriate amount of tax. This helps in
growing the economy of the country and enjoys the sustainability in the marketplace.
 Local improvement- This is an essential importance of the small business because it provides the
employment to the local people due to this their living standard will be enhanced.

 Meeting social purpose- IN this small business are work for satisfying the needs of the society by
providing the benefited to them on various level that providing quality products on loiw cost, offering
jobs etc. that helps in engaging in the large contribution of the social economy.
From the above analysis it is to be concluded that small and start up businesses may majorly impact the
growth of the economy and enhancing the living standards of the peoples. these businesses may provide the
quality and innovative goods to their customers and capture the opportunity to expand their market and
satisfying the demands of the customers. that can attracting the customers to spend more and increase the GDP
of the country(Dana, 2017).
Determine characteristic traits and skills of successful entrepreneurs that differentiate them from other business
manager
To become an entrepreneur and successful entrepreneur it is very essential to have an various skills
characteristics and traits that are under the individual person so that they can passionately work for their dreams
and become a successful in the country. every entrepreneurs have distinct features due to this they can identified
in the crowd very easily. some of the characteristics, skills and traits can be shown below regarding the Tom
mercer and peter David Jones.
Characteristic of entrepreneurs
 Passion- It is the core feature of the entrepreneur that representing the working capability of the person
beyond their capacity level. In case of Tom Mercer and Peter David Jones they both have a passion to
become a successful in their life by earning more profits and enhancing their standard of living. In this
context business manager is totally different from entrepreneur because they are working in the
organisation by fulfilling the orders of their superiors not working for their passion(Hoogendoorn,
2016).
 Hard working- It is another characteristic of the entrepreneur in which working style can be noticed by
the person. Entrepreneur has different working style as they are working hard with belief in our self that
helps in completing the task in an effective way. In this both Tom Mercer and Peter David Jones focus
on their task and work effectively so that they get efficient results. in this manager is different from the
entrepreneur as they cannot work hard for sustaining the organisation because they are not the owners of
the company.
Skills of entrepreneurship
 leadership and communication skill- It is an essential and effective skill of an entrepreneurs because
of this skill both entrepreneurs that is Tom mercer and Peter Jones offerings supports to their employees

so that they get the proper information of competing the task and deal with the complexities in difficult
situation. In this effective communication also helps in creating the good network in the market with the
stakeholders so that they can enjoy large amount of profits and become successful in the country. In this
term business managers is different from the entrepreneurs because they only lead their specific team
and communicate with them only but the entrepreneurs are the owners of the business due to this they
can communicate with the larger audience to sustain in the marketplace.
 Creative thinking skill- It shows an effective skill of an entrepreneur where they can innovate the
products and services, processes and methods to operates their business enterprise and satisfy the
demands of the customers. In this both entrepreneurs i.e. Peter David Jones and Tom Mercer having a
innovative thinking that helps in solving the problems that was present in their operating the business
and producing the innovative goods and services that can attracts the customers. in this managers is
different from entrepreneurs be3cause they are the workers of the enterprise and cannot think creatively
about solving the issues(Klapper, Biga-Diambeidou and Lahti, 2016).
Traits of an entrepreneurship
 Disciplined nature- To become a successful entrepreneur this traits is an essential trait that shows the
balanced nature between the personal and professional life of the both the entrepreneurs Tom Mercer
and Peter David Jones. It also helps in defining the how systematic entrepreneur can spend their lives
and becomes a successful by achieving their goals and objectives in an effective way. In this manager is
different from entrepreneur because they are only follow the orders of entrepreneurs and not having a
control over their personal and professional life as per the entrepreneur.
 Confident nature- In this entrepreneurial trait both Tom mercer and peter David Jones having a
confidence over their decisions this helps in accepting the challenge and fulfills it with their effective
confidence. In this due to this trait it helps both the entrepreneurs to convert their entrepreneurial idea
into the reality and become a successful. in this business manager is different from entrepreneurs
because they don’t have much confident as per the entrepreneurs have due to this they are the employee
of an enterprise(Mugler, 2017).
Assess how aspects of entrepreneurial personality reflect entrepreneurial motivation and mindset
To show the entrepreneurial personality there are various traits, skills and characteristics that can be
shown above and to reflect these terms, report can use the OCEAN model that includes 5 aspects which can be
shown below(Hadjimanolis, 2016).
 Openness- It is the first aspect of the OCEAN model that can shows the open minded, adventures
people. it helps in reflect the personality of individual person that have creative mind and full of

curiosity to complete the task this trait is high in both the entrepreneurs i.e. Tom Mercer and Peter David
Jones as they both are containing innovative nature due to this completion of task can be done in an
effective manner.
 Conscientiousness- This personality trait is based on the reliability and focusing nature of a person. In
this both the entrepreneurs Tom mercer and Peter David Jones are stay focused with their dreams and
passion due to this they can done their task in an effective way and beyond their capacity of
performing(Lima and et. al., 2015).
 Extroversion- This trait shows the extrovert nature of the person in this they can communicate easily
with other person and feel more energetic due to this both Tom mercer and Peter David Jones have
fulfilling the objective of society by connecting with them in an energetic way. this helps in connecting
the people and retaining them with the company.
 Agreeableness- It shows the trust and confident nature of the entrepreneurs that helps in fulfilling their
dreams and making the friendly relations with the peoples. In this Tom Mercer and Peter David Jones
both having a high agreeableness personality due to this they both get effective results in their field of
working and becomes successful.
 Neuroticism- This personality trait shows the emotional stability of a person in every situation. In this
both entrepreneurs Tom Mercer and Peter Jones have the personality in which they can show calm in
every situation this helps in effectively completing the task and create a healthy workplace where
employees are also encouraged to solve the difficult situation.
Using relevant example how background and experience can hinder and foster entrepreneurship
Tom mercer
Background- He is an successful entrepreneur that is graduate from the Cambridge University and after
graduation he is working as a manager consultant with Bain and co. on the London, UK. He spend their days to
thinking about the business idea and stick towards it. he work in the local area where large number of people are
wandering and finding the place for lunch and dinner. Due to this he thinks to open an outlet for the city
workers so that they can enjoy their day meal effectively. From that local market he captured the opportunity
and established the venture with the name of MOMA food in 2006. He is not come from the high class people
that can encourage them to become a entrepreneur and become successful in the country by earning more
profits(Hadjimanolis, 2016).
Experience- Tom is working in a local area where he found most of the people who do a struggle by
finding the proper place for lunch. From that he got the idea to providing the place for the people so that they

can do their lunch in a proper way. from starting he sells the fruit in an innovative way to their customers at
railway stations and understand the demands and perceptions of the passengers so that they can elaborate their
range and earns a high amount of profits. in this Tom financial condition create a major blockage in becoming
the entrepreneur but many investors help them that can encourage Tom to expand their business and open an
outlet i.e. MOMA foods.
Peter David Jones
Background- He is a British entrepreneur and a television personality. Peter was born on 18 march
1966 who are famous for Dragen’s Den and American inventor. He is interested in spending their time with
electronic equipment like mobile phones,. television etc. he lives in South Buckinghamshire with their wife and
children. He thinks to become an entrepreneur at the middle age and got the idea from their parents.
Experience- Peter is appointed as a commander in the British Empire, and he opened a bar with a name
of Cocktail Windsor. After sometimes he become a television star and opens their enterprise with a name of
Dragen den. this helps in becoming the successful in their life and earns a high amount of profits.
Elizabeth Gooch
Background- She is starting their professional carrier in the very early age i.e. 18 with the HSBC bank.
But their family condition is not so good due to this she moved to decided in the consultancy firm. After getting
the experience from their job Elizabeth started their own business for this she take the monetary help with their
family members. And from this she started their consulting firm business where they provide training to
operation management of the various department of the organization. But after some time she wants to expand
the business and for this she need more funds. At that time she touched with CEO Rodney Bakers- bates and
convince him to became a chairman to the venture and in this she get success.
Experience- After their bad family condition she quit their job and start their consulting business at
where they can give the suggestions to the operation activities at different level of organization at this time she
face many issues in arranging funds and at this she fins the chairman for their firm who can handle their
activities and earns a high profits. This will shows hard work of Elizabeth and due to this she become a
inspirational personality to all the young people who wants to start their own business.
From the above included report it is summarized that entrepreneurial and small business management is
an essential term to enhance the economy and growth of the country. in this an entrepreneur are the individual
who are having varieties of skills and knowledge to complete their vision in an desired manner. in this different
entrepreneurs having distinct typologies that helps in knowing the structure of organisation. and knowing their
contribution in the society. in this start-up and small business also play and important role to provide the

opportunities related to employment and innovation in products that can benefits the economy and society. it
also shows the various mindset and behavior that can hinder and foster the entrepreneurs to increase their living
standards.

REFERENCES
Books & Journal
Anderson, A.R. and Gaddefors, J., 2016. Entrepreneurship as a community phenomenon; reconnecting
meanings and place. International journal of entrepreneurship and small business. 28(4). pp.504-518.
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.
Dana, L.P., 2017. International entrepreneurship research: how it evolved and directions for the
future. International Journal of Entrepreneurship and Small Business. 30(4). pp.477-489.
Dana, L.P., 2018. ENTREPRENEURSHIP & SMALL BUSINESS.
Hadjimanolis, A., 2016. Perceptions of the institutional environment and entrepreneurial intentions in a small
peripheral country. International Journal of Entrepreneurship and Small Business. 28(1). pp.20-35.
Hoogendoorn, B., 2016. The prevalence and determinants of social entrepreneurship at the macro level. Journal
of Small Business Management. 54(sup1). pp.278-296.
Hosseininia, G. and Ramezani, A., 2016. Factors influencing sustainable entrepreneurship in small and
medium-sized enterprises in Iran: A case study of food industry. Sustainability. 8(10). p.1010.
Julien, P.A. ed., 2018. The state of the art in small business and entrepreneurship. Routledge.
Klapper, R., Biga-Diambeidou, M. and Lahti, A., 2016. Small business support and enterprise promotion: The
case of France. Government, SMEs and Entrepreneurship Development. Policy, Practice and
Challenges. Routledge, pp.123-139.
Laudano, M.C., Marzi, G. and Caputo, A., 2018. A decade of the International Journal of Entrepreneurship and
Small Business: a bibliometric analysis. International Journal of Entrepreneurship and Small
Business. 33(2). pp.289-314.
Lima, E. and et. al., 2015. Opportunities to improve entrepreneurship education: Contributions considering
Brazilian challenges. Journal of Small Business Management. 53(4). pp.1033-1051.
Mugler, J., 2017. The climate for entrepreneurship in European countries in transition. The Blackwell handbook
of entrepreneurship, pp.150-175.
Piperopoulos, P. and Dimov, D., 2015. Burst bubbles or build steam? Entrepreneurship education,
entrepreneurial self‐efficacy, and entrepreneurial intentions. Journal of Small Business
Management. 53(4). pp.970-985.
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.
Talebi, K., Rezazadeh, A. and Najmabadi, A.D., 2015. SME alliance performance: The impacts of alliance
entrepreneurship, entrepreneurial orientation, and intellectual capital. International Journal of
Entrepreneurship and Small Business. 24(2). pp.187-207.

Volery, T. and Mazzarol, T., 2015. The evolution of the small business and entrepreneurship field: A
bibliometric investigation of articles published in the International Small Business Journal. International
Small Business Journal. 33(4). pp.374-396.