Entrepreneurship and Small Business Management Report

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Entrepreneurship and small Business
Management

Table of Contents
Introduction......................................................................................................................................3
Lo1- explores and illustrates the range of venture types that might be considered entrepreneurial4
P1-................................................................................................................................................4
P2-................................................................................................................................................7
M1-..............................................................................................................................................8
Lo2- assess the impact of small businesses on the economy...........................................................9
P3-................................................................................................................................................9
P4...............................................................................................................................................11
M2-............................................................................................................................................12
Lo3- determine and assess the key aspects of an entrepreneurial mindset....................................13
P5-..............................................................................................................................................13
P6-..............................................................................................................................................14
M3-............................................................................................................................................16
Lo4- examine the different environment that fosters or hinder entrepreneurship.........................18
P7-..............................................................................................................................................18
M4-............................................................................................................................................20
Conclusion.....................................................................................................................................21
References......................................................................................................................................22

Introduction
Entrepreneurship refers to the definite process of starting a new business and also the study of
how to create a new business. An entrepreneur is a person who develops the idea to create goods
and services that can be bought by customers as per their needs by starting a business that helps
in sales.
To run the business an entrepreneur needs lots of effort and time. The owners of small businesses
are accountable for managing the entire company solely. Management indicates that all the
activities in the organizations must be coordinated and aligned. Thus, the owner of the business
requires using his management skills to attain the company's objectives and goals. In small
businesses, the owner needs to use the combination of his knowledge, educations, and experience
to run the business effectively.
The heart of every business is entrepreneurship. Every business has become wider and large
organizations but they started their ventures as a small business which is led by an entrepreneur.
As the market is becoming very evaporative and consisting of knowledge and skills to open a
new venture might indicate the distinction between poverty and prosperity.
In this market scenario, companies are demanding skillful entrepreneurs as every organization or
business either small or large needs entrepreneurial to survive in the market. People who know
how to keep themselves cool under the high pressure are very demanding in the business
organizations and also the innovation has been replaced by the ‘do it in our way’ is running in
the minds to run the business.

Lo1- explores and illustrates the range of venture types that might be
considered entrepreneurial
P1-
There are many types of entrepreneurship that are differentiated on the basis of technology,
business, and motivational aspects. So, in this report entrepreneurship will be discussed
according to the Clarence Danhof classification-
Figure 1- Types of entrepreneurs
Source- V. Kumar, 2018.
Innovative or aggressive-
An innovative entrepreneur is the people who give their all efforts in gathering and analyzing the
information in order to introduce the new forms or elements of production (Blundel, et al, 2017).
These entrepreneurs are:
 These entrepreneurs have the ability to see the opportunities in order to introduce the new
technology, new ideas and processes, new market and developing new organizations.

 These entrepreneurs are specified by the smell of innovativeness.
 Innovative entrepreneurs highly supportive for the economy as their business brings
changes in the lifestyle of many people.
 An example of innovative entrepreneurship is Walt Disney, the founder of Walt Disney
Company (Hjalager and Kwiatkowski, 2018).
Imitative or adoptive-
Imitative entrepreneurs are also known as an adoptive entrepreneur as these entrepreneurs adopt
the successful innovations of others which are introduced by other innovators. They simply
imitate the existing entrepreneurs to achieve success and set the business in the same way. Rather
than introducing innovations they just copy the methods, techniques, and technologies that are
innovated by other entrepreneurs (Futterer et al, 2018).
For instance, Walton BD who introduced many things such as television, motorbikes and many
more electronic items by not being the original inventor.
These kinds of entrepreneurs are very helpful in developing or less developing countries as they
are the reason behind the growth of enterprise and the entrepreneurial culture in the economy.
They are the agent of economic development since they adopt the already tested technology that
helps in creating a large number of employees for the young generation.
Fabian-
These entrepreneurs are very cautious and fearful. These entrepreneurs imitate the innovations
only when they feel that certain collapse can do big damage to their business organization.
Fabian's are very doubtful in every approach while innovating or adopting new technology in
their business. They are very less adaptable in the dynamic or changing environment. They feel
comfortable in existing business so they prefer no changes and run their business with old
methods and techniques of production. They adopt the new technology only when they realize
that the failure can make a huge loss to their business. For instance, Tom Anderson.
Drone-

These kinds of entrepreneurs are very observant and conservative in personality wise. They
never want to leave their old and traditional systems, machinery and business. Drone’s feel very
comfortable in their old fashioned methods and technology for production even after the society
and the environment has gone through some certain essential changes. But drone entrepreneurs
mainly refuse the changes and continues with the traditional and easy ways to operate their
business (Hjalager and Kwiatkowski, 2018). The activities of drone entrepreneurs are limited to
one or two innovation as they are not very adaptive towards changes. For example, the tobacco
industry as they are still making the tobacco by their hands.
Some other types of entrepreneurs are-
Arthur H. Cole entrepreneurs are classified into three types:
 Empirical entrepreneurs
 Rational entrepreneurs
 Cognitive entrepreneurs
On the basis of ownership:
 Private entrepreneur
 Public entrepreneur
On the basis of the scale of business or enterprise:
 Small scale
 Large scale
Some other classifications are:
 Solo operators
 Challengers
 Inventors
 Active partners
 Life timers

P2-
factors Small business
entrepreneurship
Scalable startup
entrepreneurship
Large company
entrepreneurship
Social
entrepreneurship
Goals and
objective
These business
organizations
don’t have certain
calculated goals,
targets and
objectives to
attain the growth
and profit from
the business.
These
organizations
always focus on
rendering
innovative goods
and services to the
customers in order
to attain a higher
return for
investors.
Large
organizations
always emphasis
on sustainability
of their business
in the market by
using different
tactics for the
development of
new products and
services.
Social
entrepreneurs, the
name itself is
saying that their
motive is to serve
the society by
providing better
quality services
and products.
risks Risk in small
business is
comparatively low
but the
competition
among small
companies is very
high.
Because of the
huge amount of
investment these
organizations have
a high risk of loss
and failure along
with this high
pressure is there to
achieve a higher
sales volume to
achieve a high
return.
Large
organizations
maintain brand
value, image, and
awareness that
helps in managing
their sales volume
so, the risk is
moderate.
Social
entrepreneurship
gets support from
many sides such
as from
government and
the public since
their vision is to
serve the society
so the risk is
moderate here.
Number of
employees
The number of
employees in
small
organizations is
always less than
The number of
employees totally
depends on the
size and structure
of the startup
The number of
employees in a
large organization
is more than 100.
The number of
employees relies
on the size of the
enterprise.

50. businesses
(Blundel, et al,
2017).
Structure These
organizations
generally not
follow the specific
structure to run
the business
operations.
Scalable
entrepreneurs
mainly follow
restricted
partnerships or
corporations.
A large
organization
follows a proper
structure for the
flow of
information in an
organization.
These
organizations are
mainly run by
trustees (Hjalager
and Kwiatkowski,
2018).
M1-
Public sector-
All the public sector organizations are directly or indirectly controlled by the government. The
investment amount of government in these companies is higher and other private companies help
the public sectors in strategizing for the future. Public sector organizations are established at
most of the different possible sectors in order to render quality services and products to the
public (Futterer et al, 2018). These organizations have a major concentration on development
and social welfare rather than on profitability.
Corporate sector-
The organizations in corporate sectors are controlled and run privately and owned by an
individual. Their main focus is diverted towards providing the best quality products so that they
can sustain in the market and make a huge profit from the increased sales. Many scalable and
large firms are connected with the corporate sectors that are mainly known for sustainable
development and strong strategies to gain a competitive advantage in the availability of strong
competitors (Blundel, et al, 2017).

Lo2- assess the impact of small businesses on the economy
P3-
The general definition of small and medium-sized organizations is that any business organization
which is having employees less than 250 in their firm. In 2018, there were 5.7 million small
medium enterprises in the UK that were approx. 99% of all the businesses of the UK (Chris
Rhodes, 2018).
Figure 2- Businesses in UK
Source- Rhodes C., 2018.
Micro businesses are consist of 0-9 employees and in the UK there are 5.4 million micro
businesses as per the 2018 business statistics and considered as 96% of all the businesses in the
UK.

Figure 3- Businesses by size
Source- Rhodes C., 2018.
Moreover, there are 5.7 million private sector businesses in the UK, if talking about the majority
of the business then the vast majority of firms in the UK is less than 10 people, these businesses
provide total 33% employment and 21% turnover in the UK economy (Chris Rhodes, 2018).
Figure 4- shares of businesses in the UK

Source- Rhodes C., 2018
The total employment provided by the SME's in the UK is 15.7 million that means 16% of
employees from the private sector are contributed to the UK. The combined yearly turnover of
SME's is 1.8 trillion that the private sector is giving a turnover of 47% in the economy of the
UK.
P4
Small businesses are very important for the success of the country and its economy. A small
business not only renders success stories to the aspirants of entrepreneurs but they also meet the
needs and wants of local community such as emergency plumber, hairdressers, consultants, etc.
small businesses are the ones who meet the needs of large firms also by providing primary or
essentials things such as printed stationery, routine maintenance, photography services, and
catering. To be enterprising it is not essential to set up your own business venture. To be a good
entrepreneur an individual needs a good attitude, development of the right skill sets and courage
as well as initiations to introduce innovation for making an effective contribution to society.
Most of the businesses in the UK are small firms and two third of small businesses are owned
and controlled by a single person. About 90% employ fewer than 6 people in the firm. These
small firms are significant in generating employment in the UK. Only 2.5 million workers in the
UK are self-employed remaining are working in someone's company (Chris Rhodes, 2018).
These small companies are businesses that are going to be huge organizations through
development.
Startups businesses have a greater influence on the maintenance of the development of the social
economy in distinct countries. The startup businesses mainly come up with business new and
innovative thinking to produce the goods and services in order to fulfill the necessity of people
through their business.
Other than this, startup businesses have the potential to capture the large market through proper
management and generate high value and revenue for the business in a short duration. And in
the development of startups organization, these firms generate a high amount of profit that
resulted in paying off tax and ultimately it is helpful in economic development (Chris Rhodes,
2018). Besides this, every startup needs human power and support to run the business operations

that lead to decreasing unemployment from the country. There are so many new businesses that
are not capable of providing high salaries to employees due to small business and its less capital.
So, to resolve this small firms or startups hires the less skilled Labour on the low salaries that
maintain a balance between satisfaction and efficiency in working. Many of the new businesses
and startups are now connecting to the various types of corporate social responsibilities that are
concerned with economic issues, environmental problems, and social issues to encourage the
brand value in the market. To support the working of business organizations, now day's
organizations are providing training and education to the people belongs to rural areas or having
a poor financial and social background. These training and education are helping the workers or
employees further in their future careers for their personal and professional growth (Chris
Rhodes, 2018). Moreover, many small businesses and startups have been established in different
sectors and industries of the UK economy which is making a major contribution to the increased
GDP of the UK.
M2-
In the UK, the number of small and medium-sized firms is very high in comparison to larger
firms. The major part of every industry is captured by the SME's and highly giving great efforts
to increase the economy of the UK. On the other side, large businesses are earning more profit
and return solely by rendering high-quality goods and services with the advantage of their brand
value in the market which facilitates greater sales. Many of the UK large businesses are set up in
foreign countries that are supporting in attaining the higher foreign currency. A large business
requires so many activities that are divided into various departments and branches which employ
needs a high number of manpower on a high salary in comparison to other organizations. These
large organizations spend a huge amount on corporate social responsibilities in order to give a
strong impact on society (Chris Rhodes, 2018). On the other hand, SME's emphasize on
innovation that entices consumers and gives a new hike to business growth. These all
organizations distribute high volume which involves a high amount of candidates and ultimately
supporting the economy of the UK in reducing unemployment.