Entrepreneurship and Small Business Management: A Report

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Entrepreneurship and Small Business Management
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Table of Contents
Introduction................................................................................................................. 3
LO1. Explore and illustrate the range of venture types that might be considered
entrepreneurial............................................................................................................4
LO2. Assess the impact of small business on the economy.......................................8
LO3. Determine and assess the key aspects of an entrepreneurial mindset............12
LO4. Examine the different environments that foster or hinder entrepreneurship.....15
Conclusion................................................................................................................ 18
Reference List...........................................................................................................19
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Introduction
Entrepreneurship is the approach of starting up an individual’s commerce and
business operation. People desiring to start-up their own business go through the
process of entrepreneurship for developing their own business sector. These people
are often identified as entrepreneurs. They have the liberty to formulate their
creativity through their goods and services offered to the consumers.
Entrepreneurship ventures are of several types related to their size and expansion
and business objective. Entrepreneurship is important as it takes the initiative of
fulfilling one’s dream into reality by changing their life. They help in enhancing the
standards of living.
In this study, an employee of a consultancy organisation would suggest several ways
to his client for setting up a successful entrepreneurship with the appropriate
entrepreneurship venture. In this context, the various types of ventures will be
illustrated for better understanding of the client. The impact of the small and micro
business sector will be discussed on the country’s economy. The various factors of
entrepreneurial mindset will be evaluated along with the various environmental
factors fostering or hindering the entrepreneurship. The consultant belongs to the
organisation named COMATCH, a consultancy organisation operating in London
and is one of the leading consultancy firm found in Europe (COMATCH. 2019). They
help and guide their clients who desire to start-up their own business organisation
with effective ways of attaining it.
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LO1. Explore and illustrate the range of venture types that might be
considered entrepreneurial.
P1. Examine different types of entrepreneurial ventures and explain how they
relate to the typology of entrepreneurship.
Entrepreneurship can be described as the technique of planning, designing,
formulating and operating a novel business venture. It is mainly related to small
business launches. The people accustomed with this new venture are termed as
entrepreneurs (Read et al., 2016). Nowadays, common people have a vague idea
about entrepreneurship. It is mandatory to create a clear conception about it. People
must be acquainted to this terminology in order to start express their creativity
through personal business start-ups.
In the present business scenario, diverse types of entrepreneurial ventures are
observed. Among the various types of ventures, some of them can be named as
small business entrepreneurship, large organisation entrepreneurship,
entrepreneurship related to scalable start-up and social level entrepreneurship
(Rauch and Hulsink, 2015).
Small business entrepreneurship can be identified as the business start-ups
related to grocery stores, storefronts, consultancy organisations, travel agencies,
internet commerce or website marketing and many others. In UK, a huge variety of
small business entrepreneurship is observed throughout the country. Entrepreneurs
related to small businesses hire people from the locality and know personnel such as
friends and family members (Burns, 2016). They use personal funding for the
business and generally do not have aspired huge success.
Large organisation entrepreneurship is a bigger format of the small business
entrepreneurship. Large organisation strives for a fixed life cycle. These
organisations usually try to improvise their products and services offered through
invasion of latest technology (Barrett and Weinstein, 2015). They need to bring in
changing for sustaining the change of customer demands, the appraisal of
competitor organisations, and other such causes. Despite these facts, incorporation
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of disruptive innovation in business operation is quite difficult for large organisation
entrepreneurship.
Scalable start-up entrepreneurship is quite dissimilar from small business
entrepreneurship. The people investing and starting up scalable entrepreneurship
have a definite target and proper planning for fulfilling it. They have the idea about
how their business will lay an impact on the world (Vargas-Hernández and
Hernández, 2017). For this purpose, they hire the best and qualified employees
within the organisation to achieve their desired targets.
Social entrepreneurship is a different type of entrepreneurship venture.
Entrepreneurs who are starting up social business try to solve social problems faced
globally. Their mission is not to attain personal profits at the sake of the world. They
try to figure out the problems faced by the common people and try to provide ways
and recommendations for resolving it (Dees, 2017). They have the capability to
impart social impact and improve the lifestyle of the people.
All these types of entrepreneurship ventures are interlinked some way or the other.
Sometimes many organisations of various scales of business try to move into a joint
venture for achieving a desired target. In such cases, they amalgamate two or more
types of ventures in a single business operation. It is evident from the definition itself
that small business entrepreneurship has a linkage with large business
entrepreneurship. Entrepreneurs can amalgamate social entrepreneurship with the
existing business to lay a affirmative impact on the civilization. In this way, the
typology of various entrepreneurships is related.
P2. Explore the similarities and differences between entrepreneurial ventures.
The availability of various kinds of entrepreneurship ventures for new business
development has various resemblance as well as dissimilarities in their typology.
Similarities help in collaboration of two or more types of ventures for a global cause
and individual development. On the other hand, the differences help in identifying the
various types of features of the several ventures. Through differences, the ideal type
of venture is identified for amalgamation. Both the facts are necessary to be
identified for starting up a new business.
The similarities between diverse types of entrepreneurial ventures can be listed as:
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 In all the kinds of trade development ventures, the common similarity is the
presence of a definite purpose for upgrading their business model
 Entrepreneurs invest their funds in developing their business and incur best
possible returns
 They need to hire employees for business operation
 They possess a definite vision for establishing their start-up
 According to a meticulous strategy, the entrepreneurs develop their business
 Before entering into the industry market, they analyse the market trend and
acceptance of the type of products and services they would offer
 They try to utilise the available resources for their manufacturing processes
The dissimilarities or differences between several types of entrepreneurship
ventures are listed in the form of a table below:
Basis of
difference
Small
business
Entrepreneurs
hip venture
Large
organisation
Entrepreneurs
hip venture
Scalable start-
up
Entrepreneurs
hip venture
Social
Entrepreneurs
hip venture
Roles They try to fulfil
the needs of
the customers
by offering
necessary
products and
earn small
scale profit
They intend to
incorporate
new design
and innovation
in their
products
offered
They have the
motto to bring
in an impactful
change on the
global industry
related to their
business and
bring in
innovative
products
They try to
incorporate
ideas and bring
in products
enhancing the
welfare of the
society
Characterist
ics
Number of
employees
hired are less
and the size of
business is
also small
The business
size is large
and as a result
the number of
employees
required for
The
entrepreneurs
hire the best
skilled
employees for
managing their
They have a
non-profit
making
business motto
for which, the
number of
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fulfilling the
task is also
high
business
operations and
are few in
number
employees
hired and the
size of
business varies
based on the
opportunity and
scope of
business
Business
objective
Run the
business
operation
evenly and fulfil
the basic
requirements
and needs of
the
entrepreneurs
With the help of
latest
technologies
they improvise
their existing
products for
meeting the
demands of the
customers
To come with a
particular plan
and setup a
business
operation
accordingly for
bringing in a
change on the
industry
Offer services
and products
for maintaining
the social
welfare of the
customers
Table-1: Differences between various entrepreneurial ventures
(Source: Created by the learner)
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LO2. Assess the impact of small business on the economy.
P3. Interpret and assess relevant data and statistics to illustrate how micro
and small business impact on the economy.
In order to assess the impact of small and micro sized business on the economy of
the country, the statistics and several factors that can influence the business
operation are needed to be taken into consideration. Small and micro business
operations lay a positive influence on the country’s economy. They avail a
personalised experience of high customer satisfaction to the common people or
customers of that country. In UK, the small business sectors have a comparatively
high turnover scaling up to £500 million. The range is quite wide spread between
£25-500 million (smallbusiness.co.uk. 2019). It helps in boosting up the financial
system of the country as it incurs huge opportunity of employment, drives growth in
the business sector. For these reasons, the small business sectors are considered
as the moral fibre of the country’s economy. In the following ways, it influences the
economy of the country:
GDP growth of the country: Small business sector has a vast contribution in
uplifting the GDP of the country. Its output is evident from the enlargement of the
economy. Enhancement of the micro business sectors have led to a drop of
business operation and profitability of several large business farms. Hence, it is
evident from the growth of UK’s economy that it has laid a positive impact on it.
Annual turnover: One of the significant factors to be considered whilst measuring
the input of micro and small business sector on the economy of the country is annual
turnover. In the year 2014, it was reported that the annual turnover of these business
sectors in UK was approximately £1.6 trillion (Clearbooks.co.uk. 2019). It was
evident that the percentage of turnover incurred in the total turnover of the
organisations in the country was about 47%. They are a useful source of revenue
with respect to export in UK.
Employment opportunity in the country: Micro and small business sectors have a
significant contribution on the creation of various job opportunities for the public of
the country. Almost 60% of employment chance is created by small business sector
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in the country that means more 24million people are employed in these sectors
(Makeitcheaper.com. 2019). They are directly helping the UK government to cut
down the rate of poverty in the country through constant generation of job
opportunities.
Figure-1: Contribution of micro and small business on UK’s economy
(Source: Market-inspector.co.uk. 2019)
It provides advantages in terms of tax to the economy of the country. It is quite
evident from the fact, that more the local consumers and customers will be reliable
on accessing the local products offered by the small business sectors the higher they
will pay back to the economy of the nation. It will certainly enhance the growth rate
of the undersized and micro business sectors with the rise of economy. It also helps
the Government of UK to earn extra revenues from the profit incurred by the small
business sectors in the form of tax. Moreover, the small business sector have
generated a huge employment in the past years as reported by several journals of
about 16 million. In the year 2017, the combined turnover was reported up to £ 1.9
trillion (Fsb.org.uk, 2019). It was about 51% of the total turnover through private
business organisations. The small and micro business sector has created
employment opportunity of about 16 million in that same year for the country.
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Figure-2: Small business sectors in UK
(Source: Statista.com. 2019)
The UK government is focusing on the development of small business sectors as it
has laid a prominent positive impact on the expansion and development of the
financial system of the country. The statistics provided above in this study depicts
the percentage of developed small business sectors in the country domain. It also
projects the input of the small and micro business sectors in the economical growth
of the country.
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P4. Explain the importance of small businesses and business starts-ups to the
growth of social economy.
In this study, the development of economy through the help of undersized and micro
business sectors in the country has been discussed. Apart from the economical
growth it plays a important role in the expansion of social economy of the country.
Small and micro start-up business helps in identifying the requirements and growing
demands with the increasing population of the country. They can do so as they deal
with the customer needs and offer products and services to fulfil them. Socially the
economy will grow as it is providing opportunity of employment to the people of the
nation. As a result, it would enhance the sales of their products as the number of
earning members is increasing in the country. From the very beginning, the small
business start-ups are very much customer-oriented as their prime target is to cater
to the requirements of the local customers of the country.
Small business sectors are boosting the social economy by enhancing and
incorporating cross-cultural working environment within the companies. It is enabling
the employees hired within the organisation to share their personal interests, views,
and opinions while working as a team. Along with the social financial system of the
country, it is also improving the working environment of the trade sectors and
enhancing its growth rate. Moreover, with the execution of the newest technology in
the SME’s of the country the UK government is indirectly being benefitted along with
the organisation. Implementation of newest technology in the offered range of
products will certain increase the popularity of the micro and small business sectors
and ultimately help in enlargement of social economy of the country.
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LO3. Determine and assess the key aspects of an entrepreneurial mindset.
P5. Determine the characteristic traits and skills of successful entrepreneurs
that differentiate them from other business managers.
A successful entrepreneur possesses some characteristic traits and skills that help in
determining the differences regarding the same between any other business
managers. The key aspects of a successful entrepreneurial mindset are discussed
as follows-
Self-Motivation: One of the most significant characters of a successful entrepreneur
is self-motivation. In every situation, an entrepreneur should always show a mindset
of approach for pushing himself or herself back especially when he or she wants to
succeed. A plan should be set at the back of each individual’s mind to keep the
movement in a forward or upscale direction. Any other ordinary business manager
has a tendency to look for motivation from other motivators (Ryan and Deci, 2017).
Risk Handling: A successful entrepreneur should always know the fact that it
becomes important to take risks in some situations. Now, the handling of a particular
risky scenario in the safest way is a practice that is supposed to be possessed by a
successful entrepreneur. In most cases, other business managers get confused
regarding the fact that he should take the risk or not. Sometimes the lack of
confidence differentiates them from a successful entrepreneur.
Flexibility: A successful entrepreneur always shows an intention of flexibility up to a
certain degree of measure. Adaptation of changes is a part of progression and a
successful entrepreneur knows that. Changes are made as per the demands from
the consumer or market ends; hence, the decision-making ability of the entrepreneur
is tested under that particular situation. On the other hand, an ordinary business
manager is not likely to adapt changes, as he or she does not remain well equipped
every time to handle the new challenges or uncertainties.
Dedication: Moreover, successful entrepreneurs always show a dedication towards
his or her form of work. They feel deeply about their performance and working
efficiency and try to improve the skills regularly. In this context, the term continuous
professional development (CPD) is introduced, where a successful entrepreneur is
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