Entrepreneurship and Small Scale Business: A Comprehensive Report

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ENTREPRENEURSHIP AND SMALL
SCALE BUSINESS

Table of Contents
INTRODUCTION.......................................................................................................................................3
LO1.............................................................................................................................................................4
P1 DIFFERENT TYPES OF ENTREPRENEURIAL VENTURES AND THEIR RELATION TO THE
TYPOLOGY OF ENTREPRENEURSHIP.............................................................................................4
P2 THE SIMILARITIES AND DIFFERENCES BETWEEN ENTREPRENEURIAL VENTURES.....6
LO2.............................................................................................................................................................8
P3 RELEVANT DATA AND STATISTICS TO ILLUSTRATE HOW MICRO AND SMALL
BUSINESSES IMPACT THE ECONOMY............................................................................................8
P5 THE IMPORTANCE OF SMALL BUSINESSES AND BUSINESS START-UPS TO THE
GROWTH OF THE SOCIAL ECONOMY...........................................................................................11
LO3...........................................................................................................................................................13
P5 CHARACTERISTIC TRAITS AND SKILLS OF SUCCESSFUL ENTREPRENEURS THAT
DIFFERENTIATE THEM FROM OTHER BUSINESS MANAGERS................................................13
P6 ASPECTS OF THE ENTREPRENEURIAL PERSONALITY REFLECTS ENTREPRENEURIAL
MOTIVATION AND MINDSET..........................................................................................................16
LO4...........................................................................................................................................................18
P7 EXAMINE USING RELEVANT EXAMPLES, HOW BACKGROUND AND EXPERIENCE
CAN HINDER OR FOSTER ENTREPRENEURSHIP........................................................................18
CONCLUSION.........................................................................................................................................20
REFERENCES..........................................................................................................................................21

INTRODUCTION
The entrepreneurship is an activity to manage, organize and develop the ventures of business. A
person who is willing to be an entrepreneur and wants to earn profit can start its small business
with certain financial risks (Anderson and Gaddefors, 2016). In this assignment, the
entrepreneurship and small business management will be discussed in order to understand the
concept of enlarging the business. The different types of ventures and their relationship with the
typology of entrepreneurship will be discussed. The impact of small businesses on the economy
will be assessed. In addition, the evaluation of differences in small, medium and large businesses
will also be done with the help of applying statistical and relevant data. Further, these
assignments will also be helpful to understand the entrepreneurial mindset as the characteristics,
traits, and skills of an entrepreneur will be determined and assessed. Different environments in
entrepreneurship will also be examined.

LO1
P1 DIFFERENT TYPES OF ENTREPRENEURIAL VENTURES AND THEIR
RELATION TO THE TYPOLOGY OF ENTREPRENEURSHIP
ENTREPRENEURIAL
An entrepreneur is a person who takes the initiative to start a business and to run it by taking
certain risks. The motive of an entrepreneur is to earn profit by taking these risks. The
entrepreneurial ventures take a high level of uncertainty with the motive of getting high returns
(Hashimoto, 2016).
TYPES OF ENTREPRENEURIAL VENTURES
Small Business Entrepreneurship: These entrepreneurial businesses are basically small in size
where an individual started its business by hiring local people, friends or family. The main
motive of these entrepreneurs is to make money to feed the family. In order to start the small
business and entrepreneur can finance its business with the help of taking the loan.
For example; travel agents, grocery stores, consultants, plumbers and so on.
Scalable Startup entrepreneurship: these entrepreneurs are those who take the initiative to
start a business with a strong vision. They think that they can change the world. In order
to make this vision true, they coordinate and deal with the different investors who are
equally crazy to make the vision successful. These entrepreneurs are more focused on
innovation in order to attract the customer but Due to the innovation, the risk capital is
almost getting attracted.
• Large Company Entrepreneurship: The large company's entrepreneurs are more
focused on finite life-cycle. They believe in continuous changes in the firm's products
and services in order to attract a large number of customers. These entrepreneurs sustain
innovations, offers new and unique products which are different from market products
and implement the services and process as well. These entrepreneurs are also required to
take care of government legislation in order to maintain their reputation across the world.
The main focus of these companies is to change the taste of the customers and to compete
the market competitors in order to be the best company across the globe.

• Social Entrepreneurship: social entrepreneurs are those who develop the product and
services to fulfill the needs and wants of the customers. The ultimate motive of these
entrepreneurs is to develop society (Morris et al., 2018). They could be a part of non-
profitable, profitable or hybrid group or organization for social welfare.
HOW THEY ARE RELATED TO THE TYPOLOGY OF ENTREPRENEURSHIP
Entrepreneurs are basically proactive, action-oriented and highly self-motivated. They are always
ready to work on their plan and take decisions and initiatives easily in order to achieve their
goals. They bring innovative products and services in the market in order to enhance the
business. The typology of entrepreneurship is helpful to achieve the individual goals in order to
get success. There are various kinds of Entrepreneurs having their own dreams and goals in their
life. The entrepreneurial typology is based on two dimensions i.e. high versus low
entrepreneurial alertness and internal versus external attribution styles. These two dimensions
clarify the vision of becoming an entrepreneur. These two dimensions help to identify the 4 types
of an entrepreneur such as true believer, Clueless, Practical, and Reluctant. The typologies of
entrepreneurship also differentiate the characteristics of entrepreneurs such as their
characteristics, ability to take the risk, need for achievements and commitments (Schaltegger,
2016). Above all the typology of entrepreneurship is helpful for future research as well.

Figure 1: TYPOLOGY OF ENTREPRENEURSHIP
Source: Masurel, and Snellenberg (2017)
P2 THE SIMILARITIES AND DIFFERENCES BETWEEN ENTREPRENEURIAL
VENTURES
The similarity between entrepreneurial ventures is, all entrepreneurs want to make a profit by
serving the people. There are many similarities and differences between entrepreneurial ventures.
In order to understand the entrepreneurial ventures better, the lifestyle and social
entrepreneurship as defined below.
Lifestyle entrepreneurship: The lifestyle entrepreneurs are those who work to alter the lifestyle
of the people. They do not focus on making money. This entrepreneurship is also based on the
passion of an individual (Masurel, and Snellenberg, 2017).
Social entrepreneurship: The individuals who are willing to find out the best resolutions for the
social, cultural and environmental issues are the social entrepreneurs. The main motive of these
entrepreneurs is to develop the funds for the welfare of society. This could be different in aims,
beliefs, and sizes from other entrepreneurship (Huda et al., 2019).

DIFFERENCES BETWEEN ENTREPRENEURIAL VENTURES
Topic Social entrepreneurship Lifestyle entrepreneurship
Location These entrepreneurs work in
very limited locations
They are not at all limited.
They enlarge their business as
much as they wish.
Donation Social entrepreneurs believe
in donation and charity but
only when they are rich.
These entrepreneurship work
raise money own their own.
They do not believe in a
donation.
Seeking profit These entrepreneurs are profit
seekers for security purpose.
They utilize the profit when
they face failure in the
business in order to recover
their business activities.
These entrepreneurs are not at
all profit seeker as they work
to maintain the lifestyle and
hence they do not run after
profit.
Business goals
These entrepreneurs are very
focused on achieving business
goals.
They do not focus more on
achieving business goals as
they are more focused on
making lifestyle, not money.
Investment Social entrepreneurs find
investors in order to enlarge
the business so that profits
could be earned.
Lifestyle entrepreneurs run
their company. They do not
find investors for investment.
Exit Strategy The social entrepreneurs have
the strategy to exit when they
feel that they are not able to
run the business anymore.
They do not follow any exit
policy as they are passionate
enough and run their business
according to their willingness
(Venkataraman, 2019).

LO2
P3 RELEVANT DATA AND STATISTICS TO ILLUSTRATE HOW MICRO AND
SMALL BUSINESSES IMPACT THE ECONOMY
At present, the economy of the UK is stable and healthy as the number of small and micro
businesses is increasing in the UK day by day. The UK is quite dependent upon these small-
micro businesses in order to maintain the economy of the country. The businesses where 0-9
employees work are micro-organizations. The organizations which employ the 10-49 people are
the micro organizations and the organizations which hire the candidates up to 10-249 are the
micro small and medium organizations. This has been analyzed that the increasing number of
small businesses are giving their tremendous contribution to developing the economy of the
country. The small businesses in the developing countries are generating the national income of
more than 32% and also developing the employment rate of more than 44%. Overall, it has been
evaluated that the small businesses are giving a great contribution to the development of the
country's economy and the governments are more focused on the development of small
businesses. the small business doesn't only develop the economy of the nation but also
contributing to the growth of the nation. The people start their own business in order to earn
profit and their start-ups are increasing the turnover ratio in a wide range. The turnover of private
sector organizations including small businesses in the UK are contributing the 47% turnover and
contributing to economic growth and national growth. The government of UK reached up to the
2.0 million turnovers annually in the year of 2018 with the help of SME's (Bruhn et al., 2018).
Roles of SMEs on the economy
The small and medium-sized organizations are contributing incredibly in order to develop the
economy of the country and also for the growth of their own company. They basically develop
and innovate varieties of products and services in order to fulfill the needs and want of the
society and serve these products to them for the development of the company and the growth of
the economy of the nation. This is how they are adding values towards society and providing
them social security as well. Apart from this, these small businesses are also reducing the rate of
unemployment by bringing more opportunities for employment in the nation.

Figure 1 impact of SME's on the economy
Source: Burns, P., 2016
Figure 2: Private sector businesses in the UK
Source: Rhodes, (2018)
• £2.0 trillion annual turnovers have been generated by small and medium-size businesses
till 2018 (Bruhn et al., 2018).
• These businesses are creating jobs in order to provide support to society.
• The poverty is getting reduced and the wealth is getting increased due to the development
of SMEs.
• The foreign exchange rate is getting higher.
• Governments are receiving tax rates (Bruhn et al., 2018).
• Small businesses are also contributing to international trading by which the profit could
be earned by selling the products and services worldwide.

• Till 2018, SMEs provided the employment of approximately 16.3 people (Bharati and
Chaudhury, 2015).
The small and medium-size businesses are contributing to a wide range in order to develop the
national economy. Although it is also true that half of the small businesses are failing as well.
there are 74% small size businesses that provided the 79% employment to the country and 71%
of revenue in the service industry where the manufacturing industry operated 5% SME's and
increased turnover up to 15% annually and provided 10% employment. This is a fact that most of
the start-ups are not going to stay longer. There are business start-ups who are obstructed for
their own savings and spending. Apart from this, facilitation of reduction of the inflation rate and
GDP rate has improved by SMEs and hence the SMEs are providing a positive impact on the
economy of the country.

P5 THE IMPORTANCE OF SMALL BUSINESSES AND BUSINESS START-UPS TO
THE GROWTH OF THE SOCIAL ECONOMY
The social economy is an economy that creates the wellness of society and standard to the
community. Small businesses and new business start-ups basically focus on generating new
ideas, creativity, and innovation to provide the best products and services to the society. It also
provides better health, living standard and employment to the national citizens. The main aim
behind developing the social economy is to provide the best social services to the society for
social welfare in the home country. The citizens can fulfill their own wishes and demand in their
own country. There are various sectors such as NGOs (Non-Government Organizations), NPOs
(Non-Profitable Organizations), Credit unions, associations, cooperatives, social enterprises,
institutions and foundations that work for social welfare. The new business start-ups also fulfill
the needs of backward and low-class families.
The entrepreneurs in the UK are more focused on raising new opportunities in order to solve the
financial problem of the family that also provide benefits to the country. Growth of the social
economy in the UK is quite helpful to solve the problems of Backward and low-class families.
There are 3 % Non-government and Nonprofit organizations who are contributing tremendously
for social wellness and for the growth of the national economy. These organizations are
facilitating the support for health care and availing the fundamental facilities so that the general
citizens can solve their problems related to the health care, financial issues and providing the
better lifestyle to poor people of the country.
The small businesses and new start-ups are also helping to strengthen the national economy by
providing a maximum number of job opportunities to unemployed people of the country. Small
businesses are also helpful to make the national economy more attractive in competitive for the
visitors and investors The UK is one of the developed nations and the reason is the development
of SMEs with the support of government (Burns, 2016).
Hence, this could be said that the government of the company is also dependent on small
businesses for the growth and development of the country's economy by generating employment,
innovation, creativity, etc.

LO3
P5 CHARACTERISTIC TRAITS AND SKILLS OF SUCCESSFUL
ENTREPRENEURS THAT DIFFERENTIATE THEM FROM OTHER BUSINESS
MANAGERS
There are various features and aspects present ineffectual entrepreneurs which help to make them
successful in their life. These attributes make them differentiating with other business managers.
They have several characteristics traits and skills which boost their entrepreneurs thought and
helpful to gain better knowledge to fulfill their responsibility (Kraus et al., 2014). There is some
bunch of characteristics and skills of entrepreneurs are following as:
Professional Network Building
Every entrepreneur uses their abilities to build such an important network which helps them to
make collaborations and also receiving different types of resources. Professional network
building has been more helpful for the organizational activities accomplishment and getting
verities of opportunities to grow and develops their internal and external operating activities by
the entrepreneur. Professional connection with corporates and others are the main roles of an
entrepreneur which helps to accomplish their tasks and activities.
Adaptability and Flexibility
Effectual entrepreneurs always ready to adopt new changes in their process of getting better for
fulfilling the objective. They are flexible with the situation and condition to adopt any implement
which makes their organization success and achievements. Adaptability and flexibility help to
identify the issues and also provides their prevention to remove all these things. Every potential
entrepreneur is always ready to make a change in their way of managing things and promoting
all these activities (Sánchez, 2013).
Risk Taking
A successful entrepreneur has that ability and capability to manage things effectively by
achieving risk. There is nothing to get without taking the risk and fronting tasks, every potential