Entrepreneurial Ventures, SMEs, and the UK Economy: An Analysis

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Entrepreneurship and Small Business
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Entrepreneurship and Small Business Management
Table of Contents
Introduction................................................................................................................................3
LO1............................................................................................................................................3
P1: Examine different types of entrepreneurial ventures and explain how they relate to the
typology of entrepreneurship.................................................................................................3
P2: Explore the similarities and differences between entrepreneurial ventures....................5
LO2............................................................................................................................................7
P3: Interpret and assess relevant data and statistics to illustrate how micro and small
business impact on the economy............................................................................................7
P4: Explain the importance of small businesses and business startsups to the growth of
social economy.......................................................................................................................9
LO3..........................................................................................................................................10
P5: Determine the characteristic traits and skills of successful entrepreneurs that
differentiate them from other business managers................................................................10
P6: Assess how aspects of the entrepreneurial personality reflect entrepreneurial
motivation and mindset........................................................................................................13
LO4..........................................................................................................................................14
P7: Examine, using relevant examples, how background and experience can hinder or
foster entrepreneurship.........................................................................................................14
Conclusion................................................................................................................................15
Recommendation......................................................................................................................16
References................................................................................................................................17
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Introduction
The assignment gives a detailed description of entrepreneurship and small business
management and its different aspects. In the first part of the assignment different types of
entrepreneurial ventures that are suitable in entrepreneurship is discussed including the
typology of entrepreneurship. In the next part of the assignment, the differences and
similarities between different entrepreneurial ventures have been explored. The next part of
the assignment consists of an assessment of statistics and data that shows the impact of small
and micro businesses on the economy. In the next part of the assignment, the importance of
small business start-ups and small business in the growth of the social economy has been
discussed. The next part of the assignment consists of the characteristic, skills and traits that
are required to become a successful entrepreneur. In the next part of the assignment reflection
of aspects of entrepreneurial personality on entrepreneurial motivation and mindset has been
discussed. The last part of the assignment consists of relevant examples that show the impact
of experience and background on entrepreneurship. The assignment would help in
understanding if an individual should open a small and medium business in the United
Kingdom.
LO1
P1: Examine different types of entrepreneurial ventures and explain how they relate to
the typology of entrepreneurship
In this section definition of entrepreneurship and entrepreneur would be provided. A typology
of entrepreneurship would also be discussed in this segment. Different types of
entrepreneurial ventures would also be discussed in this segment including the relationship
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between the types of entrepreneurial ventures. At the end, the Life Cycle of Entrepreneurial
Firms would also be discussed.
Entrepreneurship is known to be an activity that helps in setting up a business with the
involvement of financial risks so that profit could be earned (Kirzner, 2015). It can also be
stated as the process of designing, launching and running an entirely new business of small
scale. An entrepreneur is known to be an individual who sets up the business in the hope of
profit (Kuratko, 2016). There are different types of entrepreneurship and the typology of
entrepreneurship differentiates between corporate entrepreneurship, individual
entrepreneurship, and public sector entrepreneurship. Entrepreneurship is of different types
and each type has its own function and role to play (Kim et al., 2018).
Start-up is an entrepreneurial venture where an individual tries to establish a small business
(Darnihamedani, et al., 2018). The franchise is the type of business where an individual or
group of individuals takes permission to open subunits of an already established business
(Burns, 2016). This is mainly done in places where an organization has not been able to
reach. The acquisition is known to be a process where an already established business is
bought entirely by an individual or by groups of individual (Ebben and Johnson, 2018). New
development is another process of entrepreneurship where the products of an organization are
newly developed and sold in the market. The joint venture is another condition of
entrepreneurship. In this process, two established organizations come together to sell
different products in the existing or a new market (Yan and Luo, 2016). Lastly, Public Private
Partnership is known to be cooperative arrangements involving two or more private and
public parties (Hodge and Greve, 2017).
Start-up is the entrepreneurial venture which is related to individual entrepreneurship. The
franchise is known to be an entrepreneurial venture which is related to corporate
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entrepreneurship. New development again is related to corporate entrepreneurship. Joint is
that entrepreneurial venture that is related to corporate entrepreneurship. Public-private
partnership, on the other hand, is related to public sector entrepreneurship.
There are many small and medium-sized businesses opening on a regular basis. The main
challenge of any new business is to stay established in the business. Many organizations fail
to do so hence perish after operating for some time in the market. The lifecycle of an
entrepreneurship firm is simple. The first stage of the life cycle is where individuals try to
setting up a new business and are known as the birth stage (Colombelli et al., 2019). The next
in the entrepreneurship life cycle is the breakthrough stage where the organization has
established to a certain limit. People generally at this stage get involved in development. In
the last stage which is also known as maturity stage is the state where the business has no
more to grow and has the reached the highest peak of growth.
From this section it has been learned that entrepreneurship is the activity of designing,
launching a running a business of small scale and the person who is involved in doing so is
known as the entrepreneur. The section has also given us knowledge about the typology of
entrepreneurship including the relation between typology of entrepreneurship and different
ventures of entrepreneurship. It has also been learned that in the entrepreneurship life cycle
there are three stages and they are; birth stage, breakthrough stage and maturity stage.
P2: Explore the similarities and differences between entrepreneurial ventures.
This section of the assignment helps in understanding the overall entrepreneurial ventures of
entrepreneurship. In the first part of the assignment, the differences between the three main
entrepreneurial ventures have been discussed. In the next part of the section, the similarities
of those entrepreneurial ventures have been discussed as well. The last part of the section
includes a discussion on Intrapreneurship and Social Entrepreneurship.
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Lifestyle ventures are known to be a particular business set up which has been set up by an
individual with the main aim of obtaining a minimum level of income and not more than that.
The entrepreneur also has that aim to enjoy a particular lifestyle from the income and does
not intend to upgrade in terms of lifestyle.
Smaller profit venture as the name suggests in an establishment of a business where the
owner or the entrepreneur is happy with little profit (York et al., 2016). In this case, the
entrepreneur believes to earn little and has no intention to earn extra profit. These ventures
sometimes help in getting an advantage over its competitors.
High growth ventures are known to be a small business that has been designed for the
purpose of obtaining high growth and incur rapid profit from the business. These type of
ventures in order to achieve a high amount of profit follows a strategy where the product is
developed and promoted with the help of investors who provide working capital.
There are some entrepreneurial ventures that have been identified to be similar in nature.
Entrepreneurial venture based on new ideas is also termed as innovative ventures. This type
of venture basically aims to have innovative products to bring in profit. Ventures based on
new ideas are also similar to this. New ideas bring innovation which leads to risks. Any
business is not safe even after detailed market research. In the case of innovative business
ventures, there is no scope of market research as the product is new into the market and the
demand for the product is unknown. Innovative product with new ideas gives competitors a
tough time in competition with the organization which in turn gives an edge over its
competitors. This helps the organization achieve greater success. These venture types are
related to each other and have certain similarities.
Intrapreneurship has been identified to be a new concept that mainly focuses on employees
within an organization who have different characteristics and attributes of an entrepreneur
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(Gawke et al., 2017). An intrapreneur is known to be someone who has the ability to take
risks in order to solve a problem (Baruah and Ward, 2015).
Social Entrepreneurship, on the other hand, is known to be a concept where an individual
takes up a novel application in order to solve the problem of community and the individual
involved in the process is known as a social entrepreneur (Chell et al., 2016).
This section has taught about the differences in the three main entrepreneurial venture types
in terms of profit and revenue. The three main entrepreneurial ventures have been found to be
different from one other in various grounds like the style of operating the business, purpose
of running the business, earning profit and revenue and others. Likewise, there are similarities
in different entrepreneurial venture types and those have also been discussed in this section.
Lastly, brief idea about intrapreneurship and social entrepreneurship has been gained.
LO2
P3: Interpret and assess relevant data and statistics to illustrate how micro and small
business impact on the economy.
This section is mostly based on statistics and data related to entrepreneurship and small and
medium-sized business. In the first part of the segment data related to employment, economic
growth and GDP related to SMEs has been provided. The next part of the section consists of
an analysis of the role of SMEs in the economy of the UK has also been provided. Data of
other analysis regarding SMEs and large business in the UK economy has also been provided
in the last part of the section.
The United Kingdom has been a well-performing nation in terms of unemployment rate.
Their unemployment rate has been found to be just less than 4% which is an overwhelming
achievement (Tradingeconomics.com, 2019). It is believed that the rise of SMEs in the UK
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has a major role to play in this context. As per the current records, it has been identified that
the current GDP of the UK is 2.62 lakhs crore USD which is again an extraordinary
performance (Fsb.org.uk, 2019). The SMEs in the UK are believed to be contributing 47% to
the UK economy which is almost half that is being contributed to the economy of the UK.
The small and medium-sized enterprises play a major role in the economy of the UK and
have been contributing for a long time. In recent times, it has been noticed that the rise of
SMEs in the UK has increased and that is one of the major factors that helps the UK economy
grow.
The total employment in SMEs of the UK has been predicted to be 16.3 million which is also
a great result in respect to SMEs. In the year 2018, the combined annual turnover of SMEs
has been found to be £2.0trillion which is considered to be 52% of the whole turnover of
private sector in the UK (BBC News, 2019)
It has already been said that SMEs play a major role in the growth of the UK economy so the
SMEs are considered to be the booster of the UK economy. From a news article it has been
found that since 2010, 3.3 million new jobs have been created. The employment rate since
2010 has risen considerably. The data that have been provided in the section proves that the
SMEs has played and is still playing a major role in the economy of the UK. There are many
other aspects that SMEs are helping the UK to perform better in various ways. The main
contribution has been found to be on the economy.
It has already been discussed that the SMEs in the UK contribute 47%b on the UK economy.
Large businesses also play a vital role in term od contributing to the UK economy as they are
more involved in bringing in large business and other foreign currencies that has helped the
UK a lot. The rise of SMEs is not only limited to the UK but the rest of the world. The
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contribution of SMEs in the economy has enhanced by large number form the past and is
expected to rise more in the near future.
This helped in gaining knowledge about the contribution of SMEs in the UK economy and
the global economy through various numerical data and statistics. This section has also
contributed a lot in learning a great deal of the impacts of SMEs on the economy of the
country.
P4: Explain the importance of small businesses and business startsups to the growth of
social economy.
This section of the assignment discusses social economy and social enterprise including
corporate social responsibility. The importance of SMEs in the growth of the social economy
has also been discussed in this section of the assignment.
The social economy is known to be formed by a rich diversity of different organizations and
enterprises (Quarter et al., 2017). The organizations and enterprises that help in the formation
of the social economy through rich diversity are cooperatives, association, mutual, social
enterprises and foundations and others that share common values and features. The values
and features that these organizations and enterprises share are:
 Open membership and voluntary
 Democratic Governance
 Social objective over capital
 Application of the principles of responsibility and solidarity
Social enterprise is known to be an organization that helps in the application of commercial
strategies in order to maximize improvement in environmental, financial and lastly social
wellbeing (Ridley-Duff and Bull, 2015). In this case, it can be said that the enterprises focus
on maximizing social impact including external shareholders and profits
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Corporate Social Responsibility which has been abbreviated as CSR is known to be an
international private business that indulges in self-regulation (Unit, 2015). In very recent past
CSR was described as an internal strategy or policy of organizations which has considerably
passed after the development of different international laws. In many cases, it has been seen
that many organizations take part in CSR activities to win the trust of their customers and the
population. CSR activities like cleaning campaign, tree plantation campaign and others are
meant especially for the betterment of the environment and organizations invest money on
those campaigns as a gesture of responsibility towards the environment.
Like economy, SMEs also contribute a lot in the social economy of a place. We have already
seen in the earlier discussion that the social economy is formed by rich diversity and SMEs
help in creating that diversity. The growth of SMEs has opened up various spheres in the
economy and social economy is one of it. The activities performed by the SMEs also help in
forming up the social economy.
This section has enhanced knowledge about Social economy, social enterprise and Corporate
Social responsibility. Social economy has been learned to be formed by rich diversity and the
SMEs play a great deal in this context. Social enterprises are the enterprises that generally
work for the betterment of the environment. The last part of this section includes corporate
social responsibility and from the discussion, it has been learned that CSR is an internal
strategy of an organization that generally focuses on the betterment of the environment.
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LO3
P5: Determine the characteristic traits and skills of successful entrepreneurs that
differentiate them from other business managers.
An entrepreneur in order to establish and run a successful business requires certain skills and
personal characteristics. Without the required skills and personal characteristics, an individual
cannot become a successful entrepreneur. The first part of the section discusses those skill
and characteristics. The most debatable topic in the context of entrepreneur and leadership is
that if entrepreneurs or leaders are born or made hence that topic would also be discussed in
this section of the assignment.
Personal characteristics or qualities are known to be traits that make up an individual’s
personality (Kozubíková et al., 2015). Skills on the other hands are known to be the traits that
make an individual able to something and that lies in his or her expertise.
The first and foremost characteristic of a successful entrepreneur is self-confidence. A
successful must be self-confident and believe in him or her. If the individual cannot believe in
himself and his ideas then it cannot be expected that he would be able to run a business where
people would be following him and his ideas. The individual has to be confident about what
he is doing and the result he is going to achieve by his works.
The next personal characteristic of a successful entrepreneur is self-motivator. The individual
running a business must be highly motivated. In a business times would come when things
would not work out in favor and the individual who can keep him motivated and bounce back
with stronger and better plans can only be successful bot unprofessional well as personal life.
Goal oriented individual is like to be a successful entrepreneur. A successful entrepreneur
always stays focused on the goal that has been established by him. The individual in order to
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