Entrepreneurship and Small Business Management Report

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Entrepreneurship and Small Business Management

ENTREPRENEURSHIP AND SMALL BUSINESS MANAGEMENT
Table of Contents
Introduction...................................................................................................................................................... 2
LO 1.................................................................................................................................................................... 3
P1 Examine different types of entrepreneurial ventures and explain how they relate to the
typology of entrepreneurship................................................................................................................... 3
P2 Explore the similarities and differences between entrepreneurial ventures............................4
M1 Investigate a diverse range of entrepreneurial ventures to demonstrate an understanding
of entrepreneurship in both public and corporate sector..................................................................6
D1 Critically examine the scope, development and growth of entrepreneurial ventures...........6
Introduction.................................................................................................................................................. 6
LO 2.................................................................................................................................................................... 8
P3 Interpret and assess relevant data and statistics to illustrate how micro and small business
impact on the economy.............................................................................................................................. 8
P4 Explain the importance of small businesses and business starts-ups to the growth of social
economy......................................................................................................................................................... 9
M2: Evaluate the differences small, medium and large businesses make to the economy,
applying relevant data and statistics....................................................................................................10
D2: Critically examine how small businesses have an impact on different levels of the
economy (local, regional and national) and an international context...........................................11
LO3................................................................................................................................................................... 13
P5: Determine the characteristic traits and skills of successful entrepreneurs that
differentiate them from other business managers.............................................................................13
P6: Assess how aspects of the entrepreneurial aspects personality reflect entrepreneurial
motivation and mindset........................................................................................................................... 14
M3: Explore and examine different lines of argument relating to entrepreneurial
characteristics............................................................................................................................................ 15
D3: Analyse the characteristic traits, skills and motivational drivers of successful
entrepreneurs, supported by specific examples.................................................................................15
LO4................................................................................................................................................................... 17
P7: Examine, using relevant examples, how background and experience can hinder or foster
entrepreneurship...................................................................................................................................... 17
M4: Analyse the link between entrepreneurial characteristics and the influence of personal
background and experience to specific successful entrepreneurs.................................................18
D4: Critically evaluate how background and experience influences entrepreneurs, both
positively and negatively, by comparing and contrasting examples.............................................18
Conclusion...................................................................................................................................................... 20
References....................................................................................................................................................... 21
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ENTREPRENEURSHIP AND SMALL BUSINESS MANAGEMENT
Introduction
The current report is based on the entrepreneurship and the small business enterprise that
provides the idea about the various concepts like different types of entrepreneur venture, its
scope and effects of business on the economy etc. The first part of the assignment describes
entrepreneur venture and its types. The similarities and differences of the different venture
also would be describes here. Along with this, understanding of entrepreneurship towards the
public and private corporate sector also would be described. The second part of the
assignment describes the data and statistics on how the business impacts on the economy and
also the importance of having small and medium business in economy. The third part of the
assignment describes the skills and traits that entrepreneurs must have to make the business
successful. At last the fourth part of the assignment describes the importance of having the
experience and personal background in making the enterprise successful.
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ENTREPRENEURSHIP AND SMALL BUSINESS MANAGEMENT
LO 1
P1 Examine different types of entrepreneurial ventures and explain how they relate to
the typology of entrepreneurship.
Introduction
This part of the assignment describes the terms like entrepreneur and entrepreneurship. Along
with this, the typology and different types of the entrepreneurship venture also would be
discussed here.
Definition for ‘Entrepreneurship’ and ‘Entrepreneur’: Entrepreneurship could be described
as an activity where the whole business is set up by the person or the group of people. Here,
the main purpose of Entrepreneurship is to gain the profit through taking the various risks
(financial or non financial) so that the business could be expanded to the next level. Here, the
person who sets the business could be referred as the entrepreneur (Oosterbeek, Praag and
Ijsselstein, 2015). So basically, the entrepreneur could be describes as the person who takes
various decisions to achieve the business objectives and goals.
Typology of Entrepreneurship: On the basis of the involvement of the people and their
motive in setting the enterprise, this could be divided in three parts. These are:
- Individuals entrepreneurship: Here, all the decisions regarding the enterprise are taken
by a single person only as he is responsible for all the loss and profit of the company.
Here, the main motive is to get a huge growth in the market.
- Corporate entrepreneurship: Here, another business is involved in decision making
process and the main motive is to gain the profit for the company.
- Public sector entrepreneurship: Here, the public sector organisations are involved and
the only motive is to develop a particular sector of the country.
Types of Entrepreneurial Ventures: The entrepreneurship venture could be of various types
which are describes below:
- Start-up: This is private in nature and basically run by the individuals on a proper
business model.
- Acquisition: It is a term where a company take over another company and in this way,
the profit, loss and assets of first company belongs to second company only.
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- Joint venture: This is a term where two companies agree on combining their business
on the certain terms and conditions. Here, there is an agreement in between of these
two companies on sharing losses, profit and assets of both companies (Shane, Locke
and Collins, 2016).
- Franchises: This is a term which is very useful for the big organisation in expanding
its business. In this venture, the big enterprise provides the services and products
through using the assets of small company and small company receives the huge
customers through using the brand name of big organisation. McDonald is perfect
example of franchise.
Relationship between ‘types of entrepreneurial ventures’ and the ‘typology of
entrepreneurship:
The “typology of entrepreneurship” and “types of the entrepreneurial” is integral part of each
other. Here, the “typology of entrepreneurship” defines the base to the “types of the
entrepreneurial venture” on which the types of the enterprise is set and the company could be
able to take the decision accordingly and the culture of the company could be maintained in
the effective way.
Conclusion
A clear understanding of entrepreneurship and types of entrepreneurial venture could provide
the knowledge on how the business could get growth in the industry.
P2 Explore the similarities and differences between entrepreneurial ventures
Introduction
The current task would describe the similarities and differences in the various entrepreneurial
ventures like smaller profit venture, high growth venture and life style venture.
Differences between the ‘three main entrepreneurial ventures’
Area of Differences smaller profit
venture
High growth
venture
Lifestyle venture
Goals and objectives The goals and
objectives are not
structured and they
work only for
The goals and
objectives are related
to the introducing the
innovative products
Goals and objective
are related to offer
the quality product so
that the consumers
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ENTREPRENEURSHIP AND SMALL BUSINESS MANAGEMENT
gaining the smaller
profit
so that high
profitability could be
gained (Hansemark,
2018).
could use this.
Risks Lower risk is present Risks are medium Risks are high due to
financial investment.
Organisational
structure
No organisational
structure present
The organisation
structure is complex
in nature
Limited partnership
could be present
Similarities of entrepreneurial ventures:
Similarities Smaller profit
venture
High growth
venture
Lifestyle venture
Growth and vision Growth and vision of
the enterprise are
very clear and they
know what to deal
and how to deal
The growth and the
vision of the
enterprise are also
very clear here as
they have to direct
numbers of
employees towards
achieving the goals.
The growth and
vision for this is also
very clear.
Having innovative
products
Focuses on having
innovative products
so that the attention
of the customers
could be gained.
This also focuses on
innovative products
due to increased
competition (Jones
and English, 2014)
Lifestyle venture also
focuses on
introducing
innovative products
to be in the market.
Conclusion
Despite of having different goals and objectives, the three types of entrepreneurial venture
have some similarities and differences that makes it clear to the entrepreneur about where to
invest and how to invest.
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ENTREPRENEURSHIP AND SMALL BUSINESS MANAGEMENT
M1 Investigate a diverse range of entrepreneurial ventures to demonstrate an
understanding of entrepreneurship in both public and corporate sector
Introduction
The current task describes the different range of the ventures so that the tem entrepreneurship
could be understood in the terms of public and corporate sector.
In public sector: In the public sector, most of the ventures are run by the government only
and they seek the help from the private firms in consultancies etc. Here, the main motive of
the venture is to serve the customers not to earn the profit.
In corporate sector: In the corporate sector, most of the organisations are run through
individuals and in partnership. The main motive of these organisations is to earn the profit
through providing the quality products to the customers (Herron and Robinson, 2013). The
large entrepreneurial venture and scalable entrepreneurial venture are associated with the
corporate sector in order to gain the sustainable development so that the competitive
advantage into the market could be gained.
Conclusion
Entrepreneurship could be different in the private and public sector as the aim of these both
sector are different so as their working and producing the products and services for the
customers.
D1 Critically examine the scope, development and growth of entrepreneurial ventures.
Introduction
In the current task the scope and development of the entrepreneurial venture would be
discussed.
Examination of scope, development and growth:
As the mission, vision and objectives of the different entrepreneurial venture are different so
as their scope and development in the industry where they are operating. In order o meet the
objectives and goals of the venture in the industry, the enterprise needs the investment so that
the needs and demand of the customers could be achieved and the profit could be earned by
the company. Here, it could be said that the main focus of the different entrepreneurial
venture should be on the investment by the market so that the sustainability and the
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ENTREPRENEURSHIP AND SMALL BUSINESS MANAGEMENT
development could be gained by the company (Hentschke and Caldwell, 2015). In this way, a
proper organisational structure must be followed to gain the development and growth so that
the flow of the communication in the company could be effective.
Conclusion
The growth of the entrepreneurial venture are highly depends on the factor how well the
company is able to fulfil the demand and needs of the customers. Along with this, the pricing
strategies etc could help the company in gaining the desired development and growth.
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ENTREPRENEURSHIP AND SMALL BUSINESS MANAGEMENT
LO 2
P3 Interpret and assess relevant data and statistics to illustrate how micro and small
business impact on the economy.
Introduction
In each and every industry, the numbers of the small businesses are higher than the medium
and large organisation and a great impact of this could be seen on the economy of the country
as these contribute a lot in the economy. Here, the data and statistic would be shown to
explain the impact of micro and small business on the economy.
How micro and small business impact on the economy: In UK, the total numbers of the
small business unit are much higher than the large business unit. As per the study, in year
2018, approx 4.5 million small business units have been established that could be considered
as approx 98% of total business of UK. Here, a great impact of contribution of small business
unit could be seen on the economy of country UK (Barkham, 2014). Out of all these
identified unit 92% belongs to the micro business unit that provides approx 33%of
employment and 22% contribution in the total economy of UK. The graph given below
explains the employment and turnover of the small and micro business in UK against the
large business unit.
Figure 1: Businesses in UK (Baum and Locke, 2014)
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ENTREPRENEURSHIP AND SMALL BUSINESS MANAGEMENT
Small enterprises contribute a lot on the economy of the country. After the recession of 2008,
due to the presence of huge small and micro business units, the economic growth of UK has
revived easily. The chart given below shows the economic growth of UK in year 2008-2014
Figure 2: UK economic growth (2008-2014) (Chell, 2013)
For the further explanation of impacts on the economy, the following terms could be
explained:
- The impact of medium-sized businesses on economy: Positive impact of these
could be seen as besides the contribution, they provide the employment opportunities
that again strengthen the economy of the country.
- Impact of large businesses on economy: Very important for the economy as they
have large financial resources that provides the high stability to the economy.
- Impact of SMEs on Local Economy such as London: Very important role is played
by SME in the local economy as this helps in enhancing the employment growth
(Gorman, Hanlon and King, 2017).
Conclusion
A great impact of the small business and medium unit could be seen on the economy of the
country as most of the contributions are done by these companies only.
P4 Explain the importance of small businesses and business starts-ups to the growth of
social economy
Introduction
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ENTREPRENEURSHIP AND SMALL BUSINESS MANAGEMENT
Small business and business start-ups bring the various successes for the industry and to the
economy. Here, in the current task, the social economy and the importance of small business
in the economy would be discussed.
Importance of small businesses and business starts-ups to the growth of social economy:
Before explaining the importance of the small business on the economy, it is very important
to know the social economy and social enterprise. Social economy could be considered as a
sector that has the objectives of various organisations that includes all the public and private
sector. And the social enterprise is the organisation that operates in the market so that the
social value could be saved and these could be attached to the customers (Gartner, 2018).
Here, the concept of corporate social responsibility emerges that explains the organisation
about how the strategies could be formed so that an image could be formed in the mind of
customers through preserving the social values of the country.
In order to explain the importance of the small businesses and Start-ups on the social
economy, the fact could not be ignored that a huge contribution is made by these organisation
in the total economy of the country. Along with this, the employment opportunities and
productivity of the country is also maintained through these enterprises. In the other word it
could be said that the importance of the small businesses could not be ignored in
strengthening the economy and now a days they also have started to use the concept of CSR
that have brought the various benefits to the population of the country.
Conclusion
The small business and Start-ups are very important for the country to grow its economy and
it would be good if the country puts efforts in increasing the numbers of small business and
start-up in the country.
M2: Evaluate the differences small, medium and large businesses make to the economy,
applying relevant data and statistics
Introduction
The small, medium and large business put the different impacts on the economy of the
country. In the current section, the differences of these three on the economy would be
analysed.
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ENTREPRENEURSHIP AND SMALL BUSINESS MANAGEMENT
Differences in small, medium and large businesses make to the economy: As known that
the numbers of the small and medium organisation is greater than that of large organisation in
UK, here there is no doubt in the fact that they contribute a lot in the economy of UK.
However, when it comes to gaining the high revenue then large organisation helps the
economy very much. Along with this, the greater job opportunities provided by these
organisation to the population (Gorman, Hanlon and King, 2017). Other than this, the large
organisation also strengthens the country earning the money in foreign currencies. When it
comes to paying the corporate social responsibility, the large organisations are first ones that
work for the betterment of the societies living in UK.
Conclusion
Here, it could be said that a different impact of small, medium and large organisation could
be seen on economy however, all these are very important for the country to get a growth a
global level.
D2: Critically examine how small businesses have an impact on different levels of the
economy (local, regional and national) and an international context
Introduction
Small business of the country puts a huge impact on all three level of the economy (local,
national and international). These effects would be discussed in the current task.
How small businesses have an impact on different levels of the economy: The impacts of
small business on the economy:
- At regional level: Here, the small organisation provides the support to the economy by
competing with its competitors where they work to provide the good quality to the
customers. Along with this, as the finance of these companies are small so these offer
the opportunities to people who have lesser skills on lower salaries. Here, they
provide the training to these people to enhance the skills. So SME provides the
supports through providing the opportunities (Altinay et al 2015)
- At national level: At this level, small organisation provides the supports through
paying taxes that put a huge contribution in the economy.
- At international level: At this level, many small business exports their products to
other country and in this way, foreign currency comes in the country that provide
huge support to the economy.
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