Entrepreneurship and Small Business Management Report - Assessment, UK

This report provides a comprehensive overview of entrepreneurship and small business management. It begins by defining entrepreneurship and exploring various types of entrepreneurial ventures, including high-growth, low-growth, and lifestyle ventures, along with their relationship to entrepreneurship typology. The report then contrasts the similarities and differences between different types of entrepreneurial ventures (public, private, and social) and organization sizes (micro, small, and medium). It analyzes the significant impact of micro and small businesses on the UK economy, including their contribution to GDP and employment, while also exploring the importance of small businesses and start-ups in developing the social economy. The report further examines the essential skills and character traits of successful entrepreneurs, assessing how entrepreneurial personality reflects mindset and motivation. Finally, it investigates the role of past experiences and background in fostering or hindering entrepreneurship, concluding with a summary of key findings and a list of references.

ENTREPRENEURSHIP AND SMALL BUSINESS
MANAGEMENT

Entrepreneurship and small business management
Table of Contents
Introduction:...............................................................................................................................3
P1) Different types of entrepreneurial ventures and its relationship with the entrepreneurship
typology:....................................................................................................................................4
P2) Similarities and differences among different entrepreneurial ventures:..............................6
P3) Impact of micro and small businesses on the economy:.....................................................9
P4) Importance of the small businesses and business start-up for developing social economy:
..................................................................................................................................................12
P5) Skills and the character traits that create successful entrepreneur:...................................13
P6) Assessment of how entrepreneurial personality may reflect the mindset and motivation of
entrepreneur:............................................................................................................................14
P7) Importance of the past experiences and background of personnel on fostering or
hindering the entrepreneurship:................................................................................................16
Conclusions:.............................................................................................................................18
Reference list:...........................................................................................................................19
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Introduction:
In this present era, entrepreneurs are considered as the national assets that need to be
motivated, cultivated along with remunerated. Entrepreneurship is highly important fact for
any economy because it changes the way any person live as well as work so that standard of
living can be improved. Therefore, economic development if any country is entirely
dependent upon the entrepreneurial venture's development. Development of entrepreneurial
ventures not only improves the economy of any country but it also reduces the
unemployment. This assignment is intended to describe the importance of entrepreneurship
and small businesses enterprises.
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P1) Different types of entrepreneurial ventures and its relationship with the
entrepreneurship typology:
According to Morris et al. (2016), entrepreneurship refers to the willingness for developing;
managing along with organising business ventures so that profitability can be achieved.
Therefore, entrepreneurship is all about starting a new business. Any new business is
generally formed as the small and start-up businesses and then strategies are developed so
that the organisation can be maintained on long run basis. Most of the entrepreneurial
ventures are developed for gaining profitability, though there are some entrepreneurial
ventures that are developed for creating some social wellness for the societies (Morris, 2015).
An entrepreneurial can be run or maintained by a single people or it can be initiated and
maintained by two or more people. Various entrepreneurial ventures are there such as high
growth, low growth along with the lifestyle ventures.
It has been observed that a high growth entrepreneurial venture is mainly formed for the
creation of huge profit and expansion of the businesses into various areas so that it can help
the organisation in maintaining sustainability in both the international and national locations
(Bruton et al. 2015). Any high growth organisations are generally technology-based and
innovation based organisation so that they can achieve competitive advantage over their
competitors. However, it is really difficult for any entrepreneur in developing high growth
ventures in the initial stage because lots of process needs to be completed here. It has been
observed that mainly first generation entrepreneurs are there that are associated with the
development of this kind of ventures (Alvedalen and Boschma, 2017). These kinds of
ventures are mainly formed with the help of the innovative skills of the entrepreneurs so that
a superior quality unique product can be generated to create the huge amount of profitability.
On the contrary, small profit organisations are not developed for the generation of
profitability or huge expansion of the businesses (Alvedalen and Boschma, 2017). The main
intention of the small profit entrepreneurs is leading a decent life rather than becoming a
profitable entrepreneur in their newer future. One of the effective examples of this kind of
businesses is the Mom and Pop stores which have the presence in only one location that is
London (Bruton et al. 2015). This business is one of the sole proprietorship businesses that is
the business is run and maintained by the only owner. As mom and Pop store is one of the
family-owned business so the owner gains the entire sets of risks as well as income. Mainly
small-scale entrepreneurs are those entrepreneurs that are associated with running and
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maintaining the small profit entrepreneurial businesses where the owner is wholly related to
making every type of decision and strategies for developing markets (Alvedalen and
Boschma, 2017). This kind of companies mainly hires fewer numbers of employees for
performing common kinds of tasks, and they are not involved in developing a massive
volume of sales.
Lifestyle ventures are the entrepreneurial ventures that are associated with setting up any
business and running the company by the founders with the particular aim to achieve a
sufficient level of income and provide any foundation for the achievement of any active
lifestyle (Bruton et al. 2015). Attain huge profit is not the primary aim of the lifestyle
entrepreneurship because attaining the tremendous amount of growth may destroy the
primary motive for the lifestyle ventures for which the organisation has been formed. In any
lifestyle ventures, there are not any kinds of strict rule for arranging the meeting, specific
dress codes of particular hours for working. Pure entrepreneurs are those entrepreneurs that
are associated with organizing this kind of business ventures (Alvedalen and Boschma,
2017). This kind of entrepreneurs do not run and maintain businesses for the achievement of
the financial profit, and they mainly run any business for satisfying their contentment. Pure
entrepreneurs are effectively encouraged in assessing their expertise along with their
businesses performances.
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P2) Similarities and differences among different entrepreneurial ventures:
There are various types of entrepreneurial ventures that have the distinct level of
characteristics based on the roles as well as responsibilities. Though along with the
differences, there are some similarities among the features as well (Autio et al. 2014). The
below-mentioned table effectively describes the similarities along with the discrepancies
between different types of organisations that are public, social and private organisation. The
next table describes the similarities and differences among differently sized organisation that
are medium, micro and small enterprises.
Attributes Public enterprise Private enterprise Social enterprise
Purposes Public organisations are
mainly formed in order
to serve the public of any
country for their
wellness
in the contrary, the
private organisations are
mainly formed in order
to achieve profitability
and expansion
Social enterprise is
mainly formed in order
to create the social
wellness
Value Both the social along
with the corporate value
are created
Only corporate value are
associated with private
enterprises
Only social value is
associated with the
social enterprise
Distribution of
profit
Shareholders of the
company along with the
societies are benefitted
with the profit
The profit are distributed
among financiers and the
shareholders of a
company
mainly societies are
benefitted with the
profitability of this kind
of enterprises
Financial sources different types of taxes
along with excise duty
charge by the
government
Money of shareholders
and the financers along
with various loans from
the bank is the sources of
money
receiving donations are
the sources of money
Reason for
developing strategy
Distribution of the
earning of the
government equally for
developing health and
infrastructure is the main
causes for the strategy
development
Generating profitability
and securing a better
market share is the
reason behind strategy
development
Improving society and
distribution of the
donation among the
society is the reason
behind the strategy
development
Challenges the challenges faced by
the public based
Biggest challenges faced
by private organisations
Gaining donations from
the donors is the main
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organisations are related
to facing the economic
downturn condition in
the UK
are regarding handling
the human resources of
the company with
efficiency so that better
profitability can be
generated
challenges
Table 1: Similarities and differences among different types of companies
(Source: Brooks et al. 2014)
Attributes Small Medium Micro
Responsible person to
manage the
organisation
Owners Owners and the other
person involved in the
top level management
Owners
Decision making
process
Owners made every
types of decision
The personnel involved
in the top level
management makes the
decision
Owners made decision
various processes that
are utilised
The processes that are
utilised here is the
informal processes
Informal and formal
processes are used in
the medium businesses
Mainly informal
processes are utilised
Types of planning used Short-term planning Short along with the
long-term planning are
used
short-term planning are
used
Opportunities for
development
Fewer opportunity Medium level of
opportunity
Very fewer level of
opportunity available
Challenges The main challenges
associated with the
small business
enterprises are
attracting and retaining
the talented pool
Increasing customer
base fire developing
productivity is the
main issues associated
with the medium
organisation
Arranging operating
money is the main
issues associated with
the micro organisation
Table 1: Similarities and differences among different sized organisation
(Source: Alvarez‐Garrido and Dushnitsky, 2016)
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P3) Impact of micro and small businesses on the economy:
In the present era, small as well as the micro companies are not only contributing towards the
development of GDP, but it is also effectual in developing the employment opportunity in the
country. Small businesses are valid in opening new markets, creating more new ideas so that
a particular economy can be improved (Storey, 2016). Therefore, micro and small businesses
can act as the backbone for the creation of job opportunity because there are decidedly fewer
organisations that are involved in developing the employment opportunity (Gillespie and
Goddard, 2017). In the present time, among the 5.5 million private sector companies, 99.9%
are the medium and small businesses, but among these percentage, only .7% organisations are
there that are medium-sized company (Cowling et al. 2015). Therefore, it can be said that
there is 99.3% organisation that is small and micro-sized organisation. The numbers of small
and micro-sized businesses are increasing in the UK, but the number of employees is not
increasing proportionally. The main reason behind it is some organisations are non-
employing businesses (Storey, 2016). Presently, the names of non-employing companies are
growing by 84000, though there are also some of the employing companies that have been
increased to 14000.
Figure 1: Various businesses
(Source: Cowling et al. 2015)
Due to the growing number of micro and small companies, the employment opportunity is
also rising in the UK. A total of 60% employment opportunity has been created by the small
and micro businesses which are 15.7 million in numbers (Gillespie and Goddard, 2017). This
number of employees has been created by the 1.3 million employing businesses because
almost 76% businesses that are 4.2 million in amounts from 5.5 million private sector
businesses are non-employing businesses (Cowling et al. 2015). The numbers of employing
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enterprises are increasing from the earlier years that can create more employment opportunity
in the country. in the present time, the number of employment opportunity has been
developed because of the 19% development in the employing organisation in the UK.
It is observed that the increasing numbers of small and micro businesses are also creating an
opportunity for the government in earning more tax and investing the earning for the
development of the country (Burns, 2016). It has been observed that presently the majority of
the company does not hire employees and because of their smaller size, these organisations
are not the registered companies so that they do not pay tax. However, there are 2.5 million
organisations that have recorded them for paying VAT. From the statistics, it has been
observed that 53% partnership companies have registered them for paying VAT, though there
are only 14% sole proprietorship organisation that has designated them for paying VAT
(Cowling et al. 2015).
Figure 2: Different types of business
(Source: Kitching et al. 2015)
One of the present issues that strike the UK is the Brexit issues that have badly impact the
economy of the UK, but the country has saved them from complete disruption because of the
small and micro businesses. The main reason behind it is small, and micro businesses do not
operate outside of the UK which has helped them in saving during the Brexit issues (Kitching
et al. 2015). For working in various countries of Europe, the big organisation has faced
problems.
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P4) Importance of the small businesses and business start-up for developing social
economy:
Small and start-up companies are the backbones of the economy of the UK, and there are a
total of 99.5% micro and small businesses in the UK that contributes a lot in facilitating an
active growth in the social economy. With the growing percentage of the small and start-up
companies, they are not only developing the economy, but they are also involved in
developing the society (Flynn et al. 2015). It has been observed that these vast numbers of
small businesses are hiring the considerable number of employees in their organisation that
are helping the employees in maintaining their lifestyle. Along with that, this employment
opportunity is effective in engaging the young generation with work that also reduces the
number of crime in the country (Blankson et al. 2018). Moreover, it is also seen that startup
and small businesses are also helpful for the owner in achieving some level of profitability
and maintaining their lifestyle.
It has been observed that the number of the registered organisation is continually developing
in the UK. Therefore, the small and start-up businesses can be one of the sources of the
income for the government (Flynn et al. 2015). This income can help the government in
investing the money for the development of the infrastructure of the country. Along with the
infrastructure development, this money is also helpful for the government in maintaining
various types of function of the government.
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P5) Skills and the characteristic traits that create successful entrepreneur:
For being a successful entrepreneur, various types of skills along with characteristics are
essential. The first characteristics traits that are required among any entrepreneur has the
desire in running the individual and independent businesses and the desire to gain the
practical level of profitability (Klotz and Neubaum, 2016). For targeting any independent and
new companies, making active business decision is always essential, otherwise, there are vast
possibilities that the business may fail. Therefore, giving self-independence is one of the
essential characteristic traits is essential for making success entrepreneur. Additionally, an
excellent technical and the management skills are always crucial for making any person a
successful entrepreneur (Klotz and Neubaum, 2016). The case study shows the fact that in the
excel centre, the business show 2017 will be conducted that is effective for a different new
entrepreneur in gaining a practical knowledge regarding the skills, experiences and the
characteristic traits so that they can be a successful entrepreneur in the near future. There is a
variously established entrepreneur who will share their secret to be a successful entrepreneur.
J.K Rowling is one of the entrepreneurs who were rejected by numerous publishers but she
did not lose the hope. After struggling so many years, she has now achieved the worth of
$400 million for her famous Harry Potter series (Caliendo et al. 2014). On the other hand, the
example of John Paul Deja can be mentioned here who have currently achieved the property
worth of $2.8 billion by establishing his hair care brand. However, in the initial stage,
achievement of this amount of capital was not achieved, in the earlier life; he was just a
worker in a laboratory who was sacked. However, after sometimes, John has slowly
developed his own company and achieved that much property (Caliendo et al. 2014).
Therefore, from this discussion, it can be said that no entrepreneur was born with the skills
for developing their own venture. Facing struggle and situation helped them in developing
their enterprise.
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P6) Assessment of how entrepreneurial personality may reflect the mindset and
motivation of entrepreneur:
Various entrepreneurial personalities are there that are associated with the development of
motivation and mindset of entrepreneur are describing below:
Cultures:
The culture of any person has an enormous impact on their mindset and motivation to form
entrepreneurship. It has been observed that if any person belongs to any religion that creates a
narrow-minded soul, then it is tough for those people in becoming an entrepreneur (Fang et
al. 2015). This is because for becoming an entrepreneur, being open minded is necessary as it
involves several sacrifices. On the contrary, people belonging from a positive culture always
affect the highly motivated people to become an entrepreneur.
The lifestyle of various individual:
It is observed that the people who have adventurous lifestyle are more prone to be an
entrepreneur because they have the capacity in taking risks (Kuratko, 2016). On the other
hand, people with less risk-taking capabilities are not effectual to be a successful
entrepreneur.
Motivation achieved from families:
It is observed that the people who are belonging to an educated family are becoming more
open-minded so that they can quickly start their wn venture. Moreover, people residing in the
entrepreneur families are becoming more self-dependent so that they became more efficient
in being an entrepreneur (Ibrahim and Mas’ud, 2016). On the contrary, people who are
belonging to an entrepreneur family are more prone to be an entrepreneur because they get
necessary support as well as financial assistance from their families to start a new venture.
Own level of motivation:
People who have a better sense of the self-efficiency, risks and the responsibility taking
capacities are becoming an entrepreneur because they have several capabilities in getting the
motivation to be a successful entrepreneur (Ibrahim and Mas’ud, 2016).
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