Impact of Micro & Small Businesses on Economy

Micro and small businesses have a significant impact on the economy. They contribute to local and regional development, provide employment opportunities, and have a positive impact on the national economy. These businesses play a crucial role in enhancing the standard of living and promoting economic growth.

Unit 9:
Entrepreneurship &
Small Business
Management

Table of Contents
INTRODUCTION...........................................................................................................................3
TASK 1............................................................................................................................................3
P1 Various Kinds of Entrepreneurial Ventures & its relation with the Typology of
Entrepreneurship..........................................................................................................................3
P2 Discuss the Similarities & Differences between Entrepreneurial Ventures...........................5
TASK 2............................................................................................................................................7
P3 Impact of Micro & Small Businesses on Economy................................................................7
P4 Importance of Small Businesses & Starts-ups on the growth of Social Economy.................9
TASK 3..........................................................................................................................................10
P5 Characteristic , Traits & Skills of successful Entrepreneurs................................................10
P6 Concept of Entrepreneurial Personality reflect on Entrepreneurial Motivation & Mindset 11
TASK 4..........................................................................................................................................13
P7 With use of relevant examples , determine the background & experience can hinder or
foster the entrepreneurship........................................................................................................13
CONCLUSION..............................................................................................................................15
REFERENCES..............................................................................................................................16

INTRODUCTION
Entrepreneur is an individual who have ability to create and implement new business
with innovative idea so that he or she can convert that idea into reality. Entrepreneur is the one
who can bear high risk and also enjoy the success and rewards. Entrepreneur is like a backbone
of the country economy that can help to generate more many employment opportunities which
will make more profit and money by their own risk. Entrepreneurs are very innovative and with
their creative ideas, they can start their starts-ups and then work constantly to convert their starts-
ups into micro and small businesses so that they can develop gives their contribution in the
country economy growth. The main motive of this report is to cover the different kinds of
ventures and typologies related to the entrepreneurial ventures and also discuss the differences
and similarities of the entrepreneur ventures. This report also determines the statistics of micro &
small businesses and starts-ups that give their contribution in the growth of economy. Moreover,
this report will explain the characteristic, traits & skills of the famous personalities and also
discuss the background and experience of the personalities which can be foster or hinder
entrepreneurship.
TASK 1
P1 Various Kinds of Entrepreneurial Ventures & its relation with the Typology of
Entrepreneurship
Entrepreneurs are those people who are always work in uncertain situation and ready to
take risk. Entrepreneurs are mainly responsible for their decisions related to their business
operations. Entrepreneurial ventures consider as those businesses that are mainly set up with the
help of entrepreneurs to make money so that they can live their lives with full of comforts
(Venkataraman, 2019). All the ventures contain their own motive which is mainly formed by the
entrepreneurs. There are various kinds of entrepreneurial ventures which are discussed on the
basis of their size, scope, services are given below -
Entrepreneurial Activity
It is consider as a systematic procedure of the firms in which businesses can create their
value by their own so that they can generate economic activities. All these activities are mainly
incorporated with the creation of unique ideas which will help in development of entrepreneurial
ventures. Entrepreneurs are responsible to convert the unique idea into reality so that they can

give their goods and services to the potential customers. Entrepreneurs can ensure that their ideas
can develop more job opportunities for the local public so that they can help to evolve the
country economy. (Brush, Edelman and Welter, 2019).
Various Kinds of Entrepreneurial Ventures
The explanation of the different kinds of entrepreneurial ventures is as follows - Small Enterprises - This kind of venture consider massive capital, operations, and
employees. This is specifically formed to generate more money from their goods and
services that are manufactured and delivered by the business (Niosi, 2018). The scope
and size of this type of venture is very low level because it operate their businesses at
small scale and provide their goods to the niche market areas. This type of ventures
mainly uses sole proprietorship & partnership firms. This type of venture contains less
than 50 workers and the net worth considered €2 million. Examples of these enterprises
are Orion Electrotech Ltd. , Clarasys are the private enterprises and Travelodge is the
public enterprise. Large Enterprises - This type of entrepreneurial ventures contain huge level of business
operations and the scope and size of this ventures is very wide. These ventures can cover
the large market area and target huge audience. This venture can operate their business
internationally so that they need massive capital and funds so that they can perform their
business operations smoothly. These types of enterprises cam adopt the change frequently
so that they can address all the requirements of their customers. Examples of large
enterprises are Tesco, ASDA, M&S and Morrisons are the largest private enterprises and
NHS is largest public enterprises.
 Social Enterprises - This kind of ventures are established for the betterment of the
society. These enterprises used their ideas for the welfare and development of society.
This kind of venture can work individually and with a group of people and perform their
duty to the growth of local people so they local people can take their responsibility by
own and live their life in a better way (Muyassarhon, 2018). The main motive of these
enterprises is to wealth maximisation instead of profit maximisation. These ventures can
provide their participation of the overall development of the society and population. Save
the Children and Cafédirect, Hill Holt Wood etc.

Entrepreneurship Typologies
Entrepreneurial Ventures contain many typologies that are incorporated with the growth
of the businesses so that all the operations of the businesses can smooth functioning. The
description of these typologies is as follows - Lifestyle Enterprise – This enterprise are helpful to increase the standard of living of the
common people of a niche areas in which businesses can operate their day to day
operations. These businesses give employment to the local people and help them to
improve their life style. These types of ventures are generally comes under the social
venture. (Struwig, Nuwagaba and Krüger, 2019).
 Growth Enterprise – In growth enterprise, those businesses are considered those main
concern is to earn more profit & revenue. These types of enterprises are focusing on the
innovative ideas so that they can produce more money and improve the level of
productivity and profitability. The main concern of these enterprises is to satisfy
customer’s expectation so that they can cover large market. Small and large enterprises
consider in growth enterprises.
It is determined that entrepreneurial ventures and typologies are related with each other and help
to provide maximum efforts so that local people can improve their standard of living.
Entrepreneurial ventures and typologies both are give their full participation in development of
the country economy. (Shimba, 2018).
P2 Discuss the Similarities & Differences between Entrepreneurial Ventures
The explanation about the similarities and difference between Entrepreneurial ventures
are given below -
Similarities
Basis Small Enterprises Large Enterprises Social Enterprises
Meeting the
Requirement
These enterprises are
basically started to
satisfy the
requirements of the
These Enterprises are
formed to address the
needs of all the
customers’ at large
These enterprise are
established to support
the local people and
give their contribution

local people. level. in the development of
society.
Society Enhancement These types of
enterprise can give
chance for
employment to the
local people so that
they can smoothly live
their life.
These enterprise
provide work
opportunities to people
and also focus on the
innovative products so
that they can involve
lots of customers and
generate more
revenue.
These enterprises are
fully dedicated
towards the society
and perform their job
for the growth of the
common people.
Differences
Basis Small Enterprises Large Enterprises Social Enterprises
Scale These enterprises
require small fund and
small scale of businesses
and starts-ups involved
in this enterprise.
The scale of these large
enterprises is very huge
and it require large
amount of money and
resources to operate the
businesses activities.
These kind of
enterprises consider the
low scale because these
enterprise help the
people so that they can
improve economy
growth.
Objective The main objective of
this enterprise is to
perform business
operations for the local
population so that they
can live their life
suitably.
The prime objective of
this enterprise is to earn
more money from the
public to provide them
creative products which
will help them to live
comfortable life.
These enterprises work
for the upliftment of the
society and target those
person who are not able
to live their life in a
good way.
Traits These kind of business
require limited resources
These firms need
massive amount of fund
These businesses
require funds that

so that they can run their
businesses activities and
the interferences of the
government is very less.
and resources and the
involvement of the
government is more
because it provide more
contribution in the
country growth
(Ramutumbu and
Bornman, 2019).
mainly provided by the
government
organisation because
they are work for the
welfare of the people.
TASK 2
P3 Impact of Micro & Small Businesses on Economy
Micro and Small businesses enterprises are play the prominent role in the growth of
country economy. These enterprises are given their maximum support and contribution in the
development of economy so that country can enhance their market growth (Jalilov, Annayev and
Mukhammedov, 2018).
There are three kinds of businesses enterprises which are as follows -
Small - These enterprises consider less than 50 candidates and the revenue contain less than £ 5
million. This firm work on a lower scale and give more opportunities for employment to the
local people (Zhu, (Kara and Zhu, 2019).
Medium – These enterprises contain more than 50 employees and less than 250 employees. The
revenue of these enterprises considers £ 5 million and less than £ 22million. These firms give
positive impact on the development of country economy. These firms mainly focus on address
the needs and wants of the customers.
Large – These firms operate their business national and international level and the overall
involvement of the employees are more than 250 and the revenue considered more than £ 22
million. These firms can give more contribution in the development of economy.
Impact of Small and Micro Enterprises on Economy

The impact of small and micro enterprises on country economy on the basis of local,
regional and national level are given below-
 Local Impact – Micro and small enterprises give the direct impact on the local economy
and these enterprises give their goods and provide their services to the local people so
that they can full fill the needs of the customers (Doern, Williams and Vorley, 2019).
With the help of this analysis it can be identified that these enterprises the purchasing
power of the customers vary according to the goods and services that provided by the
micro and small enteritis’s which will lead the local development of the economy.
(Source: The Role of Start-ups and Small Businesses in Today’s Economy, 2018) Regional Impact - Micro and small firms also give appropriate impact on the regional
economy. These firms can provide good employment chance to the regional people so
that these enterprises can help to eliminating the problem of unemployment regionally.
These firms give positive impact on the economy and aid in the businesses process so
that they can develop the living standard of the regional people.
 National Impact - These firms direct impact on the economy of the country at national
level because they can work for the people with low fund. The main concern is to create
Illustration 1: Role of Start-ups and Small Businesses

the innovative ideas so that they can enhance the performance level and profitability level
of the firms. Almost 15.7 Million people are employed through micro and small
businesses in United Kingdom.
P4 Importance of Small Businesses & Starts-ups on the growth of Social Economy
Small businesses and starts-ups are helpful in the growth and development of the social
economy. The importance of these firms is increasing day by day. The GDP rate of the country
gains the high level of growth with the help of small businesses and starts-ups. These firms are
beneficial for the economy because it provide many job t6o the people which will lead the more
profit maximisation and it will help to increase the GDP rate of the country. UK government
take appropriate initiative like provide financial support and full fill the requirements of other
resources. There are some points are discussed which are depicts the importance of small
businesses and starts-ups for the social economy. More Employment Opportunities – Small businesses and starts-ups are create more
employment opportunities to the country people. These firms are providing direct
opportunity to the local public because these firms are starting their business at low level.
The main purpose these enterprises are to give high quality goods to the people so that
they can expand their businesses on other locations.(Urbano, Aparicio and Audretsch,
2019). Economic Development – Small businesses are responsible for the economic
development because it mainly target the native and local area people. Those people who
have creative ideas and plans, they can become the successful entrepreneurs and develop
the economic growth with their more revenue. Starts-ups create massive income every
year by give their goods and services at lower prices. They also able to pay the tax to the
government which will help to boost the finance health of the country.
 Enhance Standard of Living – Small businesses and enterprises give their maximum
contribution to increase the lives of the population. Starts-ups are consider as that types
of initiative that will enhance the lifestyle of the common people. Small businesses and
starts-ups are responsible to generate many job and address those people who have
capabilities and even they are unemployed.

On the basis of above discussion it can be said that small businesses and starts-ups are very
significant for the development for the social economy because these firms are providing various
employment chances to the needy people.
TASK 3
P5 Characteristic , Traits & Skills of successful Entrepreneurs
There are several entrepreneurs in United Kingdom which are having different
characteristics, skills and traits from ordinary people to be successful entrepreneurs. Tom Mercer
and Elizabeth Gooch are the two successful entrepreneurs with the effective skills, traits and
characteristics.
Tom Mercer
Characteristic
 Passion- As Tom Mercer is more passionate entrepreneur and focus on their work. He
contributes to searching effective solutions that will assist several people. This
characteristic Tom Mercer differentiates from other business managers to work with
passion. Motivation- It is will to attain the certain things. Tom Mercer is driven to make business
success and push. To enhance motivation, entrepreneur can begin through setting the
small objectives (Abdullah, Hadi and Dana, 2018).
Traits
 Vision- The successful entrepreneur has clear vision about business will be and articulate
its goals and purpose.
 Disciplines- This is important for entrepreneurs for success of venture as by this, it can
maintain balance among personal as well as professional life. This trait exists in Tom
Mercer because of which he focused on objectives and aim without any kind of
distraction from the other things.
Skills
 Communication- Entrepreneur requires being more effective communicator. Tom
Mercer has the better skill to connect with the staff members and other people. It
develops the strong connection and develops the positive impact on business.

 Decision-making- Tom Mercer has the effective skills to make the decisions regarding
business. This is necessary to determine process that assists to make right decision on
behalf of company.
Elizabeth Gooch
Characteristic
 Self- confidence- In this, entrepreneur believe that they can attain objectives. Elizabeth
Gooch is always ready to invest important work because he is confident to create
something better than exist. It is necessary because this permits to feel effective and make
this easier to be overcome from issues. Vision- Elizabeth Gooch has the clear vision and they see better picture to attain these
objectives. Vision is what explains culture and determine company.
Traits
 Confidence- Elizabeth Gooch has confidence in themselves and business. They should
believe in ability and idea. He will face rejection along way and keep going with the
confidence. Tenacity- Elizabeth Gooch remains tough when going gets rough. It can accept the
rejection and willing to be learn from mistakes.
Skills
 Leadership- Elizabeth Gooch has the effective leadership skill to guide the staff members
so that they can work in right direction.
 Innovative thinking- This skill is necessary so that the entrepreneurs can innovate the
ideas for resolve the issues at workplace.
P6 Concept of Entrepreneurial Personality reflect on Entrepreneurial Motivation & Mindset
Entrepreneurs have various characteristic, traits and appropriate skills that are helpful to
become them successful manager in their organisation. These elements are also helpful to
maintain the motivation and mindset of the entrepreneurs. It is analysed that these elements give
direct impact on the mindset and motivational level of the entrepreneurs. To analyse the mindset
of the entrepreneurs OCEAN model can be used so that it can help to reflect the motivation level
and mind set of the entrepreneurs.(Welter, Baker and Wirsching, 2019). These are five steps are
involved in the OCEAN model which are explained below-

Illustration 1: The Big Five Personality Traits, 2020
 Openness – It is also known as “Intellect” and “Imagination”. Through this personality
trait, anyone can identify their creativity level and desire for the skills, knowledge and
experience. These personality traits mainly incorporate with the level of emotion, ideas
and thoughts. Through this aspect, the inattentiveness and curiosity level of entrepreneur
helpful to take better decision-making for the business-functions. Conscientiousness – This personality trait is mainly associated with the reliability and
flexibility which is useful to stay focused and concerned about the about the goals so that
entrepreneurs will easily improve their productivity in order to obtain their business
objectives. Extroversion – This personality dimension help to measure the sociability level. This
personality trait is considering those entrepreneurs who are very energetic, talkative and
very social and they are also capable to influence the people and their staff members.
With the help of this trait, entrepreneurs can easily maintain healthy relationship with
their staff members so that they can retain their employees for long period of time.

 Agreeableness – This personality trait state that every entrepreneurs should be very
supportive and cooperative so that people can easily trust them. Through this trait,
entrepreneurs can maintain the trust level among their staff members. Entrepreneurs
should take suggestions and address their staff member’s opinions so that they will feel
valuable and improve their working efficiency.
 Neuroticism - This trait show the tendency toward the unstable emotions and feelings.
This personality traits determine those entrepreneurs who are certainly feel fear, anxiety
and jealous and frustration. This personality trait demonstrates the negative react of the
entrepreneurs in random situations. To eliminate this trait, entrepreneurs can apply
healthy working environment situations in their organization.
TASK 4
P7 With use of relevant examples , determine the background & experience can hinder or foster
the entrepreneurship
Entrepreneurs are risk taker so that they can able to run their organisation very efficiently
which will help them to earn more profit. Entrepreneurs are very much capable to deal with the
people and establish the strong relation with their customers because they are well prepared from
the beginning and know that customers are consider the key of successful business. Discussion
about background & experience of Elizabeth Gooch & Tom Mercer are discussed which help
them to become successful entrepreneurs.
Elizabeth Gooch Background - Elizabeth Gooch started their career at HSBC Bank when she was 18 years
old and after 1 year, she decided to leave her job and started to work in a consultancy
company but she again left this job and collected some money at least £1,000 from their
family and friends and started her own company. Through this firm, she accumulated and
provides training and consultancy services to those companies which need financial
services related to the operations management. She realised that she had a lack of
knowledge and skills so that she can improve her productivity and concentrated on to
change the services of her software. She decided to contract with Rodney Baker-Bates,
the CEO of Prudential company that provide financial services and also she recruited him

as the chairmen of her company and after that she increased her investment in order to
attract many investors.
 Experience - Elizabeth Gooch started her business in odd circumstances and besides this
she also experienced many hurdles like lack of money, lack of family and friends support.
She learnt to manage their problems so that she can develop her business. Her father gave
her advice that to start a job instead of running business. After some time, she met
Rodney Baker – Bates, who provided specific idea related to the software development
rather than providing services related to the consultancy. She did much work to took
attention of the investors so that they can invest in her business. She also experienced loss
situation in 2007 and 2008 and she tried very hard to handle those losses and she worked
very hard to so that she gained profit again in future.
Tom Mercer
 Background - Tom Mercer done his graduation from Cambridge University and he also
have experience as a management consultant in Bain and Co. that is London based
company. He has the experience of various companies and he also has new ideas related
to the business. When he operates his business, he realised that people have many options
related to lunch and dinner but he have only limited options related to the breakfast. From
there he got his business idea and started business in 2006 and provides health drink to
their customers. After sometime his business boost their growth and in 2009, there were
more than 25 employees who were working in their business organisation (Turner and
Gianiodis, 2018).
 Experience – Tom Mercer have lots of experiences in which he has also worked as a city
worker that's why he was well aware about the struggle of people so that he had decided
to provide the healthy breakfast to the people while they going to work. Mostly he went
late for the work and think about the new ideas of the business. In beginning time, he
usually cut fruits by their own and put in the bottle and they ready for selling in the
market. He chosen to sold this and work very late and constantly think new and creative’s
ideas. He sold their products in railway stations and fulfills the requirements of the
people.
The background and experience of both personalities named Elizabeth Gooch & Tom Mercer.
Both personalities have their own background and experience which determine their success

journey. Through their background and experience, people know the success and failure so that
all the other entrepreneurs can take life lessons and take inspiration with their success story.
CONCLUSION
According to this report it can be determined that entrepreneurs are that person who have the
creative idea and through this idea they can take large risk and start their start-up. This report
discussed about the entrepreneurial ventures and also finds out the typology of the entrepreneurs.
This report also explained about the small, medium, large and social enterprises and also
determines their contribution in the social economy. Through this report, personality of
successful people and their contribution in their country also discussed. This report also
highlighted background and experience of these famous personalities so that other upcoming
entrepreneurs also inspired.

REFERENCES
Books and Journals
Abdullah, N., Hadi, N.U. and Dana, L.P., 2018. The nexus between entrepreneur skills and
successful business: a decompositional analysis. International Journal of
Entrepreneurship and Small Business, 34(2), pp.249-265.
Brush, C., Edelman, L.F., Manolova, T. and Welter, F., 2019. A gendered look at
entrepreneurship ecosystems. Small Business Economics, 53(2), pp.393-408.
Doern, R., Williams, N. and Vorley, T., 2019. Special issue on entrepreneurship and crises:
business as usual? An introduction and review of the literature. Entrepreneurship &
Regional Development, 31(5-6), pp.400-412.
Jalilov, S.Z.U., Annayev, A.A. and Mukhammedov, M.M., 2018. SMALL BUSINESS AND
PRIVATE ENTREPRENEURSHIP-GUARANTEE OF SOCIAL AND POLITICAL
STABILITY. In International Scientific and Practical Conference World science (Vol. 4,
No. 1, pp. 4-6). ROST.
Muyassarhon, U., 2018. The concept of development of management of small business based on
institutional reforms. Бюллетень науки и практики, 4(4).
Niosi, J., 2018. Entrepreneurship: a short literature review. International Journal
Entrepreneurship and Small Business, 35(3), pp.257-265.
Ramutumbu, P. and Bornman, M., 2019. A tax compliance risk profile of guesthouse owners in
Soweto, South Africa. The Southern African Journal of Entrepreneurship and Small
Business Management, 11(1), pp.1-14.
Shimba, A.I., 2018. THE EFFECTS OF EXPERIENTIAL ENTREPRENEURSHIP LEARNING
PROGRAMMES ON PERFORMANCE OF TRAINEES’ENTERPRISES: EMPIRICAL
EVIDENCE FROM SMALL BUSINESSES IN TANZANIA. Business Management
Review, 21(2), pp.66-78.
Struwig, F.W., Nuwagaba, G. and Krüger, J., 2019. The influence of the business environment
on the growth of informal businesses in Uganda. The Southern African Journal of
Entrepreneurship and Small Business Management, 11(1), pp.1-10.
Turner, T. and Gianiodis, P., 2018. Entrepreneurship unleashed: Understanding entrepreneurial
education outside of the business school. Journal of Small Business Management, 56(1),
pp.131-149.
Urbano, D., Aparicio, S. and Audretsch, D., 2019. Twenty-five years of research on institutions,
entrepreneurship, and economic growth: what has been learned?. Small Business
Economics, 53(1), pp.21-49.
Venkataraman, S., 2019. The distinctive domain of entrepreneurship research. In Seminal ideas
for the next twenty-five years of advances. Emerald Publishing Limited.
Welter, F., Baker, T. and Wirsching, K., 2019. Three waves and counting: the rising tide of
contextualization in entrepreneurship research. Small Business Economics, 52(2), pp.319-
330.
Zhu, L., Kara, O. and Zhu, X., 2019. A comparative study of women entrepreneurship in
transitional economies. Journal of Entrepreneurship in Emerging Economies.