Unit 9 Entrepreneurship and Small Business Management: Assignment

UNIT 9 ENTREPRENEURSHIP

INTRODUCTION
Entrepreneurship termed out as an act of creating the businesses, willingness to develop,
and to carried out business activities along with risk (Akhmetshin and et.al., 2018). Therefore,
entrepreneur works as to undertakes the creation, organization and ownership and risk associated
with business. However, process of entrepreneurship defined as designing, launching and
running a new business effectively. Entrepreneur's responsibility is to minimize the risk with
help of research, planning and skill. This is defined as an activity that works as to set up the
business and to take financial risk with hope to make profitability.
The present report is based on topic of entrepreneurship and small business management
activities. Hence, the assignment will focus on various activities as differ kind of entrepreneur
ventures and how it relates with classification of entrepreneurship, similarities and differences
between entrepreneurial ventures, to access the relevant data to illustrate how micro and small
business impacts the economy, traits and skill of successful entrepreneurs. Lastly, relevant
examples will be given on how background and experience can hinder or foster entrepreneurship.
LO 1
P1 Description on entrepreneurial ventures and how its relate with entrepreneurship
classification.
Entrepreneur undertaking mainly consider over providing advisory services to early and
mid stage firms. Therefore, business idea comprehend new commodity or services rather than
existing business model. Thus, entrepreneurial ventured defined as-
Small business entrepreneurship- This venture is termed out as an independent owned and
operated firm and it is limited in size. It is defined as privately owned, corporations and sole
proprietors. Therefore, this firm provides services in grocery stores, hairdresser, consultants,
travel agent, electricians and plumbers etc. They generally work as to hire their own family
business (Antoncic and et.al., 2015). Thus, they work to feed their family and to earn profit for
better well being. Therefore, to start a business they can borrow the funds from their family and
friends. They need low amount of funds to set up their business activities.
Scalable startup entrepreneurship- It is a firm that initiated by individuals or entrepreneurs to
lookup for repeatable and scalable business function (Bronfenbrenner, 2017). Thus, the main aim
is to develop a possible business model in order to meet the need or problem of marketplace.
However, they conduct their business activities in manner to maintain or to improve profit
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margins. In addition to it, they mainly attract the investment from equally crazy financial
investors. Hence, it is business model that aids to turn high growth, profitable company and take
steps to expand innovation. They work as to take entry in large market and taking share away
from incumbents by creation of new market and to grow it rapidly.
Large business enterprise- Large scale enterprise is the one that has maximum of 5000
employees and they have more complex hierarchy. The main motive of this kind of enterprise is
to earn long term profitability. They are having great number of business operations on daily
basis. There are number of key personals as investor, owner and shareholder etc. In order to start
up their business they can take loan from venture capital, angel investors, financial institution
and creditors etc (Coffie and Blankson, 2018). It is the kind of the enterprise that is highly
recognizable as they are having sustainable amount of profitability. They undertake large volume
of innovation by analyzing the needs and wants of customers. Mainly, enterprise at large scale
usually produce capital and basic goods. Herein, large scale of business have the potential to
lower the cost of goods.
Non-profit organization- It is group organized for the purpose of generating high amount of
profitability or the purpose of society benefit. Hence, trusts, cooperatives, advocacy, charity
comer under this category. Therefore, main purpose of non profitable enterprise are inclusive of
feeding the homeless and managing an association of business. They are the enterprise who
undertakes business for welfare of the society not for earning profitability (Czarniewski, 2016).
However, non profit enterprise are essential to enhance the quality of life and also put positive
economic impact within out local communities.
Typologies of entrepreneurship-
 Serial entrepreneur- An individual will be defined as an entrepreneur when he will
come with a new idea in order to initiate business activities. However, emblematic
entrepreneur comes with a single idea, initiate the company and plays crucial role in
order to carried out day to day functions (DeTienne, McKelvie and Chandler, 2015).
 Lifestyle entrepreneur- In this individual defines as to create business with goal of
sterilization their personal lifestyle for the sole purpose of making profits (Dunne, 2017).
Hence, the entrepreneur who puts their major focus over life rewards provided to people.
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 Social entrepreneur- They are the individuals who have the potentials to sort out the
community based problem. Hence, the individuals who works as to brings positive
changes in society through initiatives. It is constant source of motivation for employees.
 Sole entrepreneur- They are the individuals who takes major risk in terms to generate
higher amount of profitability. It is defined as an enterprise that is owned and run by the
one perform and there is no presence of legal distinction between the owner and business
entity.
P2 Description on sameness and variation between entrepreneurial ventures.
Dimension Large Small Social Life style
Objective Large business
enterprise has main
motive to earn
profitability.
Herein, business
owner wants to
increase significant
amount of
profitability. Thus,
they must take
initiatives to obtain
maximum share to
become market
leader.
Small entrepreneurs
means an individual
who works as an
employee and
assuming all risk
and rewards of the
venture. They are
more interested in
generating daily
income.
It is the enterprise
that has null
financial aim and
takes initiative to
support and serve
public. Thus, they
earn revenue in
order to serve
needy people.
The main aim is to
improve the quality
of life with help of
focussing over their
own talent and
growth. Therefore, an
individual aimed to
financial gain with
the help of their
speciality, skill and
experience.
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Exit value*
(valuation of
assets)
Owners of Large
size Firm seeks as
to have near/mid-
term exit value.
Under this, owner
are ready to take
higher risk to
obtain high return
as soon as possible.
Valuation of assets
can done on
periodic basis and
owner best the best
value of their
business.
Small scale
enterprise has prime
objective to earn a
regular cash flow.
Social enterprise
pay less attention
towards the exit
value and assets
valuation. They
can able to leave
the industry any
time without
concerning these
terms.
Life style owners sale
their assets when they
find the best value to
their skill, interest
and hobby.
Leadership
role
Large size and
profit orientation
organisation's
leader get high
amount of
competitive
advantage (Kaushik
and Chanu, 2017)
The main motivate
of their subordinate
is to undertake
innovation, quality
maintenance etc.
Small enterprise
aims to conduct the
work practices
efficiently. They
work as to render
opportunity to its
personnel to acquire
greater and effective
knowledge. Leader
of small size
business aids to
subordinates to take
initiatives for
improved service,
product and process.
Social enterprise
do not eager to
gain high profit
margin. Herein,
Leaders
encourages and
inspires
subordinates to
undertake
voluntary action
to make tangible
change and to
serve betterment
to society.
Life- style leader
mainly focuses over
to induce creativity,
confidence and
successor. Therefore,
leader of this
enterprise empowers
supportive work
environment.
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Scope Large scale
ventures have
capacity to adopt
higher risk, as they
are having huge
amount of money,
efficient human
capital and enough
finance option.
Small size enterprise
are having limited
funding, fewer
people and low risk
tolerance. Herein,
market expansion is
low to medium
level.
Under this,
expansion
depends on retain
earning and
desirability.
Lifestyle ventures
expansion depends
over owner desire and
productivity.
Finance
sources
They are the
entrepreneurs who
can able to take
financial assistance
from issuing shares
and debenture in
financial market.
The small business
enterprise can
arrange the funds by
family and friends.
Social
entrepreneur can
get financial
assistance form
government,
volunteers and by
own.
Lifestyle entrepreneur
gets funds form
personal sources like
family and friends.
Key similarities in ventures
However, it can be stated that whole entrepreneur venture has clarity of their objective
and goal. It is very assistive to shape business strategy, vision, risk acceptance, leadership style
and growth decision. Therefore, all firms are established with differ views and to bring
something new and innovative. Profit maximisation can be considered as one of the common
goal (Edwards-Schachter and et.al., 2015). Apart from it, all entities provide great flexibility to
its owners to work as per the needs and requirements. Large, small, social and lifestyle venture
owner have also controlled over the business activities. Each enterprise not only renders personal
employment opportunities even wealth creation can be automatically done. Thus, small venture
can also capable to earn chuck of amount when business sale out decision will be taken place,
same in large size organisation.
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LO 2
P3 Description on interpret and access relevant data and statistics to elaborate how micro and
small business effect on economy.
Small and medium sized enterprise is the one who have fewer than 250 employees. In
2016, there were total 5.4 millions small scale enterprise and there were 99% of all businesses.
Small enterprise are considered to be the backbone to the UK economy in terms to driving
growth, creation of jobs and opening new market (Elo, 2016). Therefore, small firms needs to
upgrade the managerial skills and their capacity to gather the information. In 2014, the estimated
business were operating about 5.2 millions in the UK. Therefore, 99.9% among them was small
scale enterprise.
Illustration 1: Small business statistics
(Source: Facts about small medium businesses in the uk, 2018 )
It can be clearly stated that there are 99.3% small size business are working in industry, in which
the medium enterprises has 0.6% share in market and big company's number remain limited to
0.1% only. Total sale of SME's are 33%, for medium-sized and 14% and big start up enjoying
53% of total revenue of industry. Small business enterprise contributes to local economies with
help of bringing growth and innovation. To stimulate economic growth by providing
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employment opportunities aids to people employable by larger enterprises (Favaretto and et.al.,
2017). Therefore, small business enterprise takes maximum innovation and may also improve
standard of living, also creates jobs and provide betterment to the society.
Micro enterprise put their major focus over to bring innovation and this new idea and
technology bring improvement in society. Like a small size SME's takes initiatives to develop
new road engineer machine with help of contributing their own efforts. It is the innovation that
aids to conduct big infrastructure development project and road making. Hence, economic
actives are generated because of these business and it also aids to enhanced opportunities for
employment too (Gailly, 2018).
However, it can be stated that profitability of small business enterprise has wide impact
over the economy of UK whereas medium-sized enterprise do not have such influence.
P4 Define the importance of small business and business starts up to growth of social economy.
SME's plays important role in economies with help of bringing innovation and growth.
Therefore, small businesses has provided wide job opportunities to people and that cannot be
employable by larger entities. By contributing growth and vitality in several areas of economies
and socioeconomic development this entities are earning long term profitability. This can be true
to said that small business has wide affect on the economy (Giaoutzi, Storey and Nijkamp,
2016). Therefore, small enterprise has also faced uncertain future from the time of referendum
decision to leave Europe.
Thus, major contribution of small business enterprise are as they enhanced financial
Independence, raised innovation and to take initiatives in terms to creates employment
opportunities. By stimulating towards economic growth by providing the employment
opportunities they are putting larger impact on economic development within country (Favaretto
and et.al., 2017). Due to Brexit, rules and regulations of conducting the business activities has
been rewritten.
After the issue of Brexit, UK has faced 0.5% of decline in growth rate of GDP. It has
affected the entrepreneur ventures in the UK and also created negative impact on the economy.
After this, small sized enterprise has helped in terms to lower the adverse impact of globalisation
on employment in social economy. It is true to said that small businesses are vital to get the
success of the economy. Furthermore, SME's has undertaken wide entrepreneurship that has
helped towards poverty reduction as its creates employment with the help of establishment of
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new entrepreneurship. Hence, economic wealth can e enhanced by creating new markets, new
industries and new jobs etc.
LO 3
P5 Determination on the characteristic, skill of entrepreneur that distinguish them from business
managers.
Successful entrepreneur Elizabeth has several qualities through which she is capable to
stand alone and took initiative to commenced her own business. Also, there are few unique
differences between the managers and Elizabeth and that considered as leader or entrepreneur.
After, working in HSBC for about 12 months she resigned from her job and initiated her
on small business. Furthermore, Elizabeth took innovative approach from starting and by this
skill she has identified the demand of industry and market. Thus, she started her own consultancy
firm. During the middle phase, the business has also encountered with ups and downs for 2
consecutive year. After this, she has been evolved with some more unique qualities.
Besides it, she meth with an entrepreneur took decision to change the firm from
consultation to software. This step has been successfully proved the vision of Elizabeth and that
is mostly absent in characteristic of manager.
The another successful entrepreneur is as Tom, has also faced number of problems from starting
of his business (What is the Actual Impact of Small Business on the Economy?, 2018). Therefore,
it has been identified that tom was very risk allowance individual. He has always hoped that
someday positive result will come for sure. Hence, this kind of quality can be absent in role of
managers. He has started his business activities in manner in which he was sure about getting
success. Thus, this quality proves that Tom has precise business skill but this skill is also absent
in manager. During the time of recessions, The strategy of Tom was that he can pull his business
to various super shops and it was one of the huge milestone for his business, it has showed
persuasive characteristics within Tom.
P6 Define how entrepreneurial personality indicate entrepreneurial mindset and motivation.
Entrepreneur personalities reflects entrepreneur approaches in life towards creating
businesses. At first, Elizabeth has some quality through which she has obtained wide success in
her life. It has been identified that Elizabeth is freedom oriented person (DeTienne, McKelvie
and Chandler, 2015). After, working in HSBC for 12 months Elizabeth left her job and started
small business. Also, being always an innovative person and she has identified the demand of the
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industry and started her own consultancy firm. It has helped to identified that she has bravo in
nature. During the middle of journey, she also has faced falls in two consecutive years. This
incident has come up with identifying some more qualities in her and it has showed hr
perseverance skill (DeTienne, McKelvie and Chandler, 2015.). Afterwards, she met with an
entrepreneur and came to conclusion to change consultation firm to software firm. It has proved
the visionary skill of Elizabeth. The another entrepreneur,
Tom has also reflected some skill as he worked as to distribute the sample of product in
market with positive hope and that has proved that Tom was very risk endurance individual. Tom
also has very rare business skills as he was also about sure that someday commodity will hit in
market. At the time of recession, Tom has strategy that he could pull his business to various
super shops and this has become huge milestone for his business. It has shown persuasive
characteristic within the tom (Favaretto and et.al., 2017).
However, background of Tom and Elizabeth has hindered them from their success. With
help of entrepreneur characteristic they become capable to succeed to overcome their hinders.
LO 4
P7 Examine with use of examples that how background and experience hinder or foster
entrepreneurship.
Entrepreneur as Elizabeth has successfully proved that without any technical knowledge
it is very typical to implement the right business model. Thus, family status of Elizabeth was so
weak. She had borrowed from various people at the time of starting her business. Therefore,
credit card also help her at the time of initiating the business.
Furthermore, Tom was not having place to start up his business that why he placed his shop at
outside the railway station. Thus, there are some hinders of the life of Elizabeth and Tom but
they both successfully recover those issues and pulled in way that has become remarkable one.
Thus, Elizabeth after meeting with entrepreneur has identified that she needs to covert her
business to software firm. With help of having some instincts quality within the individual can
fosters any individuals to go beyond. Therefore, Tom has also struggled a lot due to business
place. Tom has come good business skills that has helped him to get the space in super shop at
the time of recession and this kind of opportunity has fostered the growth of business at the
wider perspective. Therefore, it can be said that skills and talent aids to have the growth in the
future. They both have faced problems due to their background.
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CONCLUSION
Hereby, it can be concluded that entrepreneurship defined as ability to create, form and
bring off business ventures to make profit. Thus, entrepreneur boost economic growth with help
of introducing innovative technical advancement, product and services. Therefore, present report
was based on entrepreneurship and small business management activities.
Herein, report has covered the topic as types of entrepreneur venture and their typologies,
similarities and differences between the entrepreneur ventures, significance of small businesses
towards the growth of social economy. Lastly, the characterised and traits of Elizabeth and Tom
has been discussed that differentiate them from other business managers.
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REFERENCES
Book & Journal
Akhmetshin, E. M and et.al., 2018. Freelancing As a Type of Entrepreneurship: Advantages,
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from S lovenia. Journal of Small Business Management.53(3). pp.819-841.
Bronfenbrenner, M., 2017. Income distribution theory. Routledge.
Coffie, S. and Blankson, C., 2018. Strategic prescriptive theories in the business context of an
emerging economy. Journal of Strategic Marketing. 26(5). pp.373-384.
Czarniewski, S., 2016. Small and medium-sized enterprises in the context of innovation and
entrepreneurship in the economy. Polish Journal of Management Studies. 13.
DeTienne, D. R., McKelvie, A. and Chandler, G. N., 2015. Making sense of entrepreneurial exit
strategies: A typology and test. Journal of Business Venturing. 30(2). pp.255-272.
Dunne, C., 2017. Can Intercultural Experiences Foster Creativity? The Relevance, Theory and
Evidence. Journal of Intercultural Studies. 38(2).pp.189-212.
Edwards-Schachter, M and et.al., 2015. Disentangling competences: Interrelationships on
creativity, innovation and entrepreneurship. Thinking Skills and Creativity. 16. pp.27-39.
Elo, M., 2016. Typology of diaspora entrepreneurship: Case studies in Uzbekistan. Journal of
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Favaretto, R. M and et.al., 2017, October. Using big five personality model to detect cultural
aspects in crowds. In Graphics, Patterns and Images (SIBGRAPI), 2017 30th SIBGRAPI
Conference on (pp. 223-229). IEEE.
Gailly, B., 2018. Manage Entrepreneurial Ecosystems. In Navigating Innovation (pp. 57-104).
Palgrave Macmillan, Cham.
Giaoutzi, M., Storey, D. J. and Nijkamp, P., 2016. Small and medium size enterprises and
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Online
Facts about small medium businesses in the uk. 2018. [Online]. Available though<
https://www.market-inspector.co.uk/blog/2017/05/facts-about-small-medium-businesses-
in-the-uk >
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What is the Actual Impact of Small Business on the Economy?. 2018. [Online] Available
through : <https://www.thebalancesmb.com/small-business-impact-on-the-economy-
4175064>
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