Entrepreneurial Ventures and Small Business Impact on the Economy

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Entrepreneurship and Small Medium Business
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Table of Contents
Introduction...................................................................................................................... 4
LO1.................................................................................................................................. 5
P1 Examine different types of entrepreneurial ventures and explain how they relate to
the typology of entrepreneurship..................................................................................5
P2 Explore the similarities and differences between entrepreneurial ventures............7
M1: Investigate a diverse range of entrepreneurial ventures to demonstrate an
understanding of entrepreneurship in both public and corporate sector.......................8
D1: Critically examine the scope, development and growth of entrepreneurial
ventures........................................................................................................................8
LO2................................................................................................................................ 10
P3 Interpret and assess relevant data and statistics to illustrate how micro and small
business impact on the economy...............................................................................10
P4 Explain the importance of small businesses and business starts-ups to the growth
of social economy.......................................................................................................11
M2: Evaluate the differences small, medium and large businesses make to the
economy, applying relevant data and statistics..........................................................12
D2: Critically examine how small businesses have an impact on different levels of the
economy (local, regional and national) and an international context..........................12
LO3................................................................................................................................ 14
P5 Determine the characteristic traits and skills of successful entrepreneurs that
differentiate them from other business managers......................................................14
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P6 Assess how aspects of the entrepreneurial aspects personality reflect
entrepreneurial motivation and mindset......................................................................15
M3: Explore and examine different lines of argument relating to entrepreneurial
characteristics.............................................................................................................16
D3: Analyse the characteristic traits, skills and motivational drivers of successful
entrepreneurs, supported by specific examples.........................................................16
LO4................................................................................................................................ 18
P7 Examine, using relevant examples, how background and experience can hinder or
foster entrepreneurship.............................................................................................. 18
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...................19
Conclusion..................................................................................................................... 20
References.....................................................................................................................21
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Introduction
In the present scenario, management of small businesses and their activities is
considered as a critical task to perform. The entrepreneurs of small companies are
required to emphasize on developing and offering innovative and different services and
products to stay competitive in the market (Julien, 2018). Furthermore, continuous
improvements in offerings needs to be carried out so that new customers can be
attracted and the existing ones can be retained in an appropriate manner. The present
report outlines different aspects and concepts linked with entrepreneurship and small
business management. The examination of various ventures associated with
entrepreneurship has been carried out in the research. The key differences and
similarities between different forms of entrepreneurial ventures have also been
highlighted in the current research report. The overall impact of different companies on
economy of a country has been outlined in the study.
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LO1
P1 Examine different types of entrepreneurial ventures and explain how they relate to
the typology of entrepreneurship
The classification and description of various entrepreneurial ventures has been carried
out in the below mentioned answer.
In simpler terms, entrepreneurship can be defined as the process in which a new
business or company is launched, developed and managed along with a certain degree
of financial risk. Entrepreneurship is also defined as the overall willingness or
capabilities of a person to launch and operate a business in the marketplace
(Scarborough, 2016). Furthermore, entrepreneur is the person or individual who
develops and launch the business in any of the industry.
The typology of entrepreneurship can be classified into three major categories which
are individual entrepreneurship, public sector entrepreneurship and corporate
entrepreneurship (Staniewski, 2016). Individual entrepreneurship is the one in which a
person instead of focusing on working as an employee, start his/her own business with
an objective to deal with different types of risks and attain rewards.
However, public sector entrepreneurship is a different concept as it involves integration
of different authorities working at state, national and regional levels with an objective to
assist and provide support to new and young entrepreneurs in starting their own
ventures. Apart from this, corporate entrepreneurship in term used to define the process
of developing new services and products within the existing workplace with an objective
to generate more revenue by creating value for the customers (Yan and Yan, 2016).
The entrepreneurship venture can be further classified into different categories which
are acquisition, start ups, joint ventures, public private partnership and franchisee. In
simpler terms, startup is defined as a very young business enterprise which has started
to develop in a particular industry or marketplace.
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However, it can be argued that the main and most important characteristic of startup
businesses is that these ventures offer services and products which no other player in
the market is offering. Acquisition is form of entrepreneurship in which one business firm
buys complete or partial shares of another company with a purpose to take complete
control over management and other important functions (Dunne et al. 2016). Public
private partnership is the form of entrepreneurship venture in which different types of
the businesses in the private as well as public sector form a partnership with each other
to accomplish common goals and objectives. Franchisee is a type of venture in which
an individual buy the rights to use the logo, copyright and trademark of a big established
business.
It can be also expressed that there is a direct relationship with the types of
entrepreneurship venture and typology of entrepreneurship and this can be justified by
the fact that venture such as startups fall under the category of individual
entrepreneurship whereas acquisition and franchisee come under the category of
corporate entrepreneurship (Burns and Dewhurst, 2016). Apart from this, venture such
as public private partnership may fall under the category of corporate entrepreneurship
or in the category of public sector entrepreneurship.
The lifecycle of entrepreneurial firms consists of three major stages which are birth
stage, breakthrough stage and maturity stage. In the first stage i.e. of birth, the
entrepreneurs focus on establishing the business in the marketplace and getting the
customers (Saleem, 2017). In the second stage which is breakthrough stage, the
entrepreneurs emphasize on areas such as making the business profitable by working
in finances. In the last stage, the overall cooperate strategy is refined and success is
managed by entrepreneurs.
It can be concluded that the typology and venture of entrepreneurship are directly
related and connected with each other.
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P2 Explore the similarities and differences between entrepreneurial ventures
The present answer carries out a discussion on the key similarities and differences
among various entrepreneurial ventures. Furthermore, the concept of Intrapreneurship’,
and ‘Social Entrepreneurship are also highlighted in this answer.
It has been analyzed that there are certain differences and similarities between various
entrepreneurial ventures and these factors needs to be considered effectively. The
three main entrepreneurial ventures are classified as smaller profit venture, lifestyle
venture and high growth venture (Bogdanova et al. 2016). The main and most important
difference between the above mentioned three different forms of ventures is linked with
the purpose of their establishment.
Lifestyle ventures are formed with a gradual and slow business plan and the primary
purpose of such ventures is to provide adequate income and occupation to the owners
in the future. On the other hand, small profit ventures are the one which are directed
towards attaining a margin profits for their growth and survival in the marketplace
(Doern, 2016). The objective of high growth ventures is to attain rapid increase in the
profit and high growth in the industry.
However, it can be argued that along with certain differences there are some similarities
between the mentioned above forms of entrepreneurship ventures. For instance, all
three ventures are established and based on new ideas and concepts which further
supports in attracting more and more customers. In addition to this, smaller profit
venture, lifestyle venture and high growth venture also emphasize a lot on areas such
as achieving greater success and this can be termed as another major similarity
between these ventures.
Intrapreneurship is defined the process or concept in which an individual behaves like
entrepreneur at the time of getting associated with and working for a large-scale
corporation (Mugler, 2017). The concept is getting more and more popular within the
corporate world because it is helping individuals in enhancing their management skills
and abilities of taking risk.
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Social entrepreneurship is a concept in which new business venture is developed with
an objective to resolve the issues or challenges prevailing within the culture, society or
environment.
It can be concluded that the major difference between smaller profit venture, lifestyle
venture and high growth venture is linked with the purpose because of which these
businesses are operating in the marketplace. In addition to this, it can be also inferred
that established on new ideas and attaining better success are similarities between
these ventures.
M1: Investigate a diverse range of entrepreneurial ventures to demonstrate an
understanding of entrepreneurship in both public and corporate sector
It has been identified that at present there are wide ranges of entrepreneurial ventures
operating in the corporate and public sector and it is required by entrepreneurs to
develop adequate understanding about the same (Volery and Mazzarol, 2015). For
example, joint venture is the form of venture in which two or more companies integrate
or collaborate with each other to carry out common business operations and attain the
objectives. On the other hand, startup businesses are the corporate sector ventures
formed with a purpose to offer something new and innovative to people in the societies.
Acquisition is the form of venture in which one company acquires other business with an
objective for growth and expansion.
D1: Critically examine the scope, development and growth of entrepreneurial ventures
The scope of entrepreneurial ventures differs from each other and at the same time the
degree of growth and development also varies to a great extent. For example, the
scope of startup businesses is that they emphasize on solving issues and problems in
societies by delivering innovative solutions (Schaper, 2016). The rate of growth and
development of such venture is very high in comparison with the other ventures. The
scope of venture such as acquisition is to enhance the profitability and market share of
the business whereas public private partnerships are developed with a scope to offer
services and products to people in the market at affordable and economic prices. The
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overall rate of growth and development of ventures such as acquisition, franchisee, joint
ventures and public private partnership is moderate.
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LO2
P3 Interpret and assess relevant data and statistics to illustrate how micro and small
business impact on the economy
In the below mentioned answer, the interpretation and assessment of data relevant to
the way in which small business are making impact on economy has been carried out.
Nowadays, the small and micro businesses in UK are playing a critical role in overall
growth and development of employment and economy of the country. Back in
December 2018, the employment rate in the nation was recorded as 76.10% and the
average of employment in UK has been recorded at 71.24%. The average GDP growth
rate in the nation is recorded as 2.45% and the rate can be termed as highly satisfactory
with regards to developed country such as UK. The role played by small and micro
businesses in the development of nation’s economy is outstanding as small businesses
accounted to the more than 99% of the private sector companies in the country (UK
small business statistics, 2018). These businesses are contributing a lot in the
economic development of the nation by creating several potential opportunities linked
with job and employment. In the year 2018, more than 5 million small scale businesses
started in the country and the overall turnover of micro businesses accounted to £2.0
trillion.
It has been also been identified that micro or small businesses are driving the degree of
employment in the country to a great extent. Furthermore, the data collected also
highlights the fact that at present more than half of the overall working population in the
country is employed by various organizations functioning in the nation. These
companies or enterprises have currently employed more than 15 million people at the
national level and this contribution can be termed as outstanding in every term (Small
business UK, 2017) Apart from this, the contribution of large-scale companies towards
the economic development of UK cannot be neglected. Out of the total 500 large
businesses of the entire world, 26 are headquartered in UK and these organizations are
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contributing in development of the country through factors such as brining foreign
exchange, carrying out exports and creating opportunities for employment.
It can be concluded that the contribution of large, small and medium scale businesses
towards economic development within the nation is significant in every aspect.
P4 Explain the importance of small businesses and business starts-ups to the growth of
social economy
The role of small-scale companies and startups in context of the growth of the social
economy of the entire nation has been discussed in the present answer.
In simpler terms, social economy is a form of economy which is developed when
diversified organizations and companies operate together in an economy. Here,
collaborative and partnership approach is taken into consideration by companies and
businesses to operate in the economy (Julien, 2018). On the other side of this, social
enterprise is a form of business organization which employs different strategies and
action plans with an objective to reduce their negative social and environmental impact
and provide adequate return to the stakeholders.
The term corporate social responsibility (CSR) has now become very popular in the
corporate world or business environment and it can be defined as the concept which
encourages businesses to become responsible towards three major areas which are
economy, society and environment (Burns, 2016). Nowadays, accomplishment of CSR
has become vital for the success and sustainability of organizations because these
responsibilities directly contribute in enhancing the brand image and public reputation of
a company in the market.
The concept of CSR outlines the fact that businesses operating in a country are not only
responsible for generating higher profits and they are also responsible for taking care of
the impact of their operations on environment and societies. It has been identified that
at present, small and medium enterprise are playing a very important role in success
and growth of social economy (Burns and Dewhurst, 2016). The rationale behind this is
that the support provided by SME’s is not restricted to growth of overall GDP and these
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businesses are also contributing a lot in areas such as improving the lifestyle and living
style of people in UK. At present, wide ranges of economic opportunities are offered by
SME’s to the individuals living in various societies and this further contributes in the
overall growth of social economy.
It can be inferred that at present accomplishment of corporate social responsibilities
have become very significant for the companies. Furthermore, SME’s are carrying out
considerable impact on areas such as social economy.
M2: Evaluate the differences small, medium and large businesses make to the
economy, applying relevant data and statistics
It has been evaluated that the large, small and medium scale businesses are making
significant differences in making the overall economy of the country. For example, the
small and medium scale organizations are making differences by creating opportunities
for employment. At present, more than 50% of the overall workforce in UK has been
employed by the small and medium scale enterprises (Scarborough, 2016). Apart from
this, the large scale businesses are making impact by increasing the exports and
bringing more volume of foreign exchange within the country.
D2: Critically examine how small businesses have an impact on different levels of the
economy (local, regional and national) and an international context
According to Adebayo and Otemuyiwa (2015), the role played by small scale
organizations in the development of economy cannot be neglected in any given
situation. It has been witnessed that small organizations may not make much salary
independently when appeared differently in relation to enormous associations; anyway,
they accept a key employment in the achievement of the economy. Additionally,
extensive and private companies in the market are not providing adequate chances to
other businesses in carrying out smooth functioning in the market. Meanwhile, private
endeavor components have two or three activities just; hence they have been provided
with ample opportunities to the individuals in terms prosperity and development. Aldrich
(2017) has stated that small businesses are also offering better opportunities in terms of
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