Entrepreneurial Ventures and Small Business Growth in the UK Economy

Desklib provides past papers and solved assignments for students. This report analyzes entrepreneurship and small business management.

ENTREPRENEURSHIP AND SMALL
BUSINESS MANAGEMENT
1

Table of Contents
LIST OF FIGURES.............................................................................................................................4
INTRODUCTION............................................................................................................................. 5
TASK 1............................................................................................................................................ 6
P1 TO EXAMINE THE DIFFERENT TYPES OF ENTREPRENEURIAL VENTURES AND ITS RELATION
WITH THE TYPOLOGY OF ENTREPRENEURSHIP..........................................................................6
P2 THE SIMILARITIES AND DIFFERENCE BETWEEN ENTREPRENEURIAL VENTURES...................8
M1 TO DEMONSTRATE THE CONCEPT OF ENTREPRENEURSHIP IN PUBLIC AND CORPORATE
SECTOR.................................................................................................................................... 10
TASK 2.......................................................................................................................................... 12
P3 THE IMPACT OF SMALL BUSINESS ON THE ECONOMY........................................................12
P4 SMALL BUSINESS AND BUSINESS STARTUPS CONTRIBUTION IN THE GROWTH OF SOCIAL
ECONOMY................................................................................................................................ 13
M2 THE ANALYSIS OF DIFFERENCES IN SMALL, MEDIUM AND LARGE BUSINESS WITH
CONTEXT TO LOCAL, REGIONAL AND NATIONAL LEVELS OF THE ECONOMY..........................14
TASK 3.......................................................................................................................................... 16
P5 TO DETERMINE THE CHARACTERISTIC TRAITS AND SKILLS OF SUCCESSFUL
ENTREPRENEURS..................................................................................................................... 16
P6 TO ANALYSE THE ASPECTS OF ENTREPRENEURIAL PERSONALITY THAT REFLECTS THE
ENTREPRENEURIAL MOTIVATION............................................................................................17
M3 TO EXAMINE DIFFERENT TYPES OF ENTREPRENEURIAL CHARACTERISTICS.......................19
TASK 4.......................................................................................................................................... 20
P7 TO EXAMINE THE BACKGROUND AND EXPERIENCE THAT FOSTERS THE
ENTREPRENEURSHIP................................................................................................................20
M4 TO ANALYSE THE LINK BETWEEN ENTREPRENEURIAL CHARACTERISTICS AND THE
FACTORS LIKE PERSONAL BACKGROUND INFLUENCED THE SUCCESSFUL ENTREPRENEURS...21
CONCLUSION............................................................................................................................... 23
REFERENCES.................................................................................................................................24
2

LIST OF FIGURES
Figure 1 Process of Entrepreneurial activity..................................................................................5
Figure 2: Private Sector Business Growth in the UK....................................................................12
Figure 3: Business share of all the business enterprises in the UK...............................................14
3

INTRODUCTION
In this report, the detailed study of entrepreneurship and small business management that
contributes to building entrepreneurial skills and abilities is being discussed. In every business,
the most important person who manages the business activities is the entrepreneur, so how
the skills of the entrepreneur affect the managerial decision in different ventures of the
business is being discussed. The report will further focus on the differences and similarities, the
scope, and growth of different entrepreneurial ventures. The impact of small businesses in the
economy and how the economy has developed due to starting up the small business is being
emphasized.
4

TASK 1
P1 TO EXAMINE THE DIFFERENT TYPES OF ENTREPRENEURIAL VENTURES
AND ITS RELATION WITH THE TYPOLOGY OF ENTREPRENEURSHIP
ENTREPRENEURSHIP:
Entrepreneurship means to create a business with the aim of earning the profit. Not only
introducing the business, but entrepreneurship also initiates the social change, creates the new
products with innovative ideas and presents the solution for the challenges arises in business
life. It involves an individual i.e. entrepreneur who makes the changes in the world with the
actions. Entrepreneurship is all about innovations and execution of new ideas (Kuratko, 2016).
FACTORS INVOLVED IN ENTREPRENEURIAL ACTIVITY AND ENTREPRISE
In the process of entrepreneurship, to develop and manage enterprises there are three factors
to be considered: Job of the entrepreneur, promotion of the business and the business
operations (Chand, 2019).
The job of entrepreneurs is all about generating new ideas and preparing the relevant report.
The below-given diagram shows the process of entrepreneurial activity that is involved in
entrepreneurial business/enterprises (Chand, 2019).
Figure 1 Process of Entrepreneurial activity
(Source: Chand, 2019)
5

The activities that are involved in the entrepreneurial enterprises is that it develops the
managerial skills and abilities by studying the problem, identifying various alternatives,
comparing the same in context with cost, benefits and then to choose the best alternative
among the same. This also develops the decision-making capabilities of the entrepreneurs.
With the help of managerial skills, the enterprises are able to attain the desired objectives
(Chand, 2019).
DIFFERENT TYPES OF ENTREPRENEURIAL VENTURES WITH CONTEXT TO THE TYPOLOGY OF
ENTREPRENEURSHIP
The different types of entrepreneurial ventures are as follows:
Micro Organizations: Such type of organizations are mainly managed and operated by less
number of owners and employees. The small/micro organizations include consulting firms,
cyber cafes, supermarket stores, automobile owners, etc. Small organizations have shown
tremendous growth in the UK economy after the recession took place. In the UK, Alpha
Financial Market Consulting, Shopper media group, Aspire group and many others are the well-
known small entrepreneurial enterprises in the UK.
Medium-Sized Organizations: These organizations have the entrepreneurs that are focused on
both earning profit and generating the new concepts in the business. Generally, contractors,
tourism operators, etc. are the entrepreneurs of such enterprises. Examples of medium-sized
organizations are Smith Brothers Contractors Ltd. Verdant Leisure, etc. are well-known
organizations in the UK.
Large Organizations: Such type of organizations focuses to introduce new products and services
to sustain the business in the market. As there are large numbers of competitors of large
corporations, the entrepreneurs of such organizations have to survey the ongoing trend in the
market and to retain the customers has to make the necessary changes. Amazon, McKinsey and
Company, etc. are the best companies in the UK that focus on updating the business operations
as per the advanced technology.
6

Lifestyle Businesses: The entrepreneurs of lifestyle business work on the basis of their passion
and do not focus on just earning the profit. Such businesses are set to follow the passion and to
work what one loves to do.
Social Good Organizations: Social organizations, the name itself suggest works for the welfare
of society by delivering products and services at the low costs or cost-free.
Scalable Startup (Angel Investors): These ventures focus on changing the current plans and
emphasize on best quality products and services with creativity innovative ideas. So such
enterprises always hire efficient staff. Scalable start-ups are enterprises that expand investment
and capital with the help of creative ideas.
P2 THE SIMILARITIES AND DIFFERENCE BETWEEN ENTREPRENEURIAL
VENTURES
DIFFERENCE AND SIMILARITIES BETWEEN SERIAL ENTREPRENEURS, INTRAPRENEURS AND
OWNED MANAGERS
The similarities between the serial entrepreneurs, intrapreneurs and owner-managers are as
follows (Surbhi, 2016):
Entrepreneurs and Intrapreneurs Entrepreneurs and Managers
Both of them require the vision and
strategy to be defined.
Both works mainly in the decision-
making process.
Leadership skills are utilized for the
success of the enterprise.
Both are aware of the strategies of the
business.
Both works on planning, validating,
building and launching the ideas.
They both are the authorised people of
the business.
They create innovative opportunities. They forecast the business plans.
7

Below table describes the difference between intrapreneurs, serial entrepreneurs and owner
managers (Cadar and Badulescu, 2015).
Basis Serial Entrepreneurs Intrapreneurs Owner managers
Main Aim To create
opportunities and
generate money
With the abilities to
contribute to the
company's objectives
To promote the
company’s objectives
and rewards the staff.
Time course To survive and
achieve business
growth in 5-10 years
Depends on the
requirement in the
company
To meet the short
term objectives and
plan the periodical
budgets.
Activity Direct participation Direct participation
more than
assignment
More delegation that
participation
Risk Risk taking is
moderate.
Same as serial
entrepreneurs
Cautious.
Dealing with failures Both mistakes and
failures are being
noticed
Usually tries to hide
failures and mistakes
Supervises the
mistakes.
Decisions They follow the
dreams along-with
decisions
Make the other
authorities agree on
the decision
Generally follows the
decision from top
level management.
8

M1 TO DEMONSTRATE THE CONCEPT OF ENTREPRENEURSHIP IN PUBLIC AND
CORPORATE SECTOR
DIFFERENT TYPES OF ENTREPRENEURIAL VENTURES IN PUBLIC AND CORPORATE SECTOR
Government is the main determinant who manages the enterprises of public sectors. In public
enterprises, the entrepreneurial skills lie with that of the government bodies. The ideas
generated by the government are executed in the organizations for making the changes. There
is generally no sharing of profits among the employees in public sector enterprises (Leyde and
Link, 2015).
While on the other hand, incorporate sector enterprises, it includes establishing new ventures
with the help of innovations and generating the latest products and services and also changes
the ongoing business structures. In such enterprises, the skills are regularly required to be
developed among the employees (Leyde and Link, 2015).
The different types of ventures are categorized below on the basis of ownership, gender, size of
the enterprise.
(i) On the basis of ownership:
Private: in such ventures, the main aim is to earn a profit by improving the services and
products. This will not only maximize the profit of the company but will also contribute to the
growth of the business enterprise (Etzkowitz and Zhou, 2017).
Public: The public enterprise is managed by the government and aims to work for social welfare
and avoids risky activities.
Voluntary: The entrepreneur of such ventures generally focuses on social welfare and provides
the basic facilities to the society without the motive of profit earning. Such ventures are
monitored and controlled by a particular group of people and the funds that are collected from
the public are invested in the benefits of society (Etzkowitz and Zhou, 2017).
9

(ii) On the basis of business size:
Small Scale Enterprise: the enterprises in which the number of people employed is less than 10
and the turnover generated is below £2 million are known as micro-enterprises. While the
enterprises in which the number of people employed is less than 50 and the turnover
generated is approximately £10 million are known as small scale enterprises (Etzkowitz and
Zhou, 2017).
Medium scale enterprises: The employee in medium scale enterprises are about 250 and
generate a revenue of approximately £50 million.
Large Scale Enterprises: more than 250 employees are employed in large scale enterprises. The
approximate turnover generated id more than £50 million (Etzkowitz and Zhou, 2017).
(iii) On the basis of gender:
Men: the businesses that are owned and managed by the males are said to be enterprises of
men.
Women: the enterprises that are either wholly or partially i.e. 51% of the shareholdings are
under control of women and the business activities are carried under the guidance of women
are known as enterprises owned by women (Etzkowitz and Zhou, 2017).
Thus it is to be justified that because of the political factors participation, the public sector
enterprises are rigid in nature. On the other hand, corporate sectors work according to the
abilities and develop the best culture in management (Etzkowitz and Zhou, 2017).
10

TASK 2
P3 THE IMPACT OF SMALL BUSINESS ON THE ECONOMY
After the recession period in the UK, there has been incremental growth in micro and small
business enterprises. The funds that are invested in these companies are invested from the
external source. About 60% of the loans are being taken as the business startups, or for the
purpose of expansion or to issue the capital or to purchase the business assets (Bonhill Group
Plc, 2019).
In the year 2008, after the financial crisis, there were many technological changes occurs and
many financial business institutions lost the trust among the people. After that banks started to
provide loans that should be fully secured. As the grants and loans for such startups were
available online, it became simpler for the business enterprises to take advantage of such
platforms and take the loans (Bonhill Group Plc, 2019).
There was the number of job opportunities generated by the small business enterprises and
this contributed to the growth of the economy. There are 5.7 million private business sectors
that are a small business in the UK. As per the 2018 report, this was 3.5 million in the year 2000.
Thus, the growth of small business enterprises increased by 63% in a short span of time (Bonhill
Group Plc, 2019).
The employment generated by small business enterprises is about 60%. The total turnover of
small enterprises is £2 million which includes private sector units also by 52%. In the report of
Hampshire Trust Bank and Centre for Economics and Business Research, it was disclosed that
about 11% growth has been contributed by £196 billion businesses from 2015to 2020. It is
expected that till 2020, this may increase up to £217 billion from 10 UK cities’ small enterprises
(Bonhill Group Plc, 2019).
11

Figure 2: Private Sector Business Growth in the UK
(Source: Storey, 2019)
Some of the small business enterprises are Uber, Airbnb, and Viacom in the IT sector, and so
on. These companies have generated a huge competition in the UK market. London is said to be
the main centre for small business and the contribution led by it is expected to increase from
£149 billion to £164 billion by 2020, i.e. it will contribute to the UK economy about 76% (Storey,
2019).
The small business enterprises have contributed a large part in the growth of the country’s
economy by generating a total turnover of around £2 trillion in the previous year.
Microenterprises have contributed a remarkable growth and also brought new entrepreneurs
in the UK market. Thus such enterprises are the most essential part of the UK economy (Storey,
2019).
P4 SMALL BUSINESS AND BUSINESS STARTUPS CONTRIBUTION IN THE
GROWTH OF SOCIAL ECONOMY
Small business enterprises have hugely contributed in the growth of the economy and are
successful due to the main emphasis is led upon fulfilling the general requirements such as
catering services, stationery and printing, photography services, financial consultants and so on.
Social economy factors support not only the public sector but the private sector also (Burns and
Dewhurst, 2016).
12