Entrepreneurial Ventures and Small Business Impact on the Economy

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Entrepreneurship and Small business management
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Table of Contents
Examine how small business has impact on different levels of economy...................................13
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Introduction
Entrepreneurship is the heart of every business as large businesses or companies started
initially as small business which is started by an entrepreneur and they are seen as those
individuals who always look forward in the creation and development of products or new
market segments. Entrepreneurship has various types depends on the nature of business type
and technology. The entrepreneurship mainly described as running and development of new
business and bears all the risk involved. In this report we will discuss how entrepreneurship
and small business are involved in ventures and categorized on the basis of technology,
motivational, entrepreneurial activities based on skills and positive mindset.
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TASK 1
Different types of entrepreneurial ventures and explain how they relate to the typology of
entrepreneurship.
There are four types of entrepreneurial ventures which are explained below:
 Small business entrepreneurship: Entrepreneurs and Startups are small business runs
his/her own business and hire local employees or family members to operate the day
to day activities and barely profitable. Their main motto is to fulfil basic necessities of
family and is funded by friends, family or small loans. For example: Grocery stores,
hairdressers, travel agents, storefronts etc.
 Scalable Start-up entrepreneurship: This type of entrepreneurship is concerned with
changing the world through their visions and gets investment through venture
capitalists and hires those who have the brightest minds and ideas.
 Large Company Entrepreneurship: Large companies have high level of market share
by creating new innovations, offering new products with their existing products.
These companies collaborates with other innovative ventures to create a new product
according to change in customer tastes, new technologies etc.
 Social Entrepreneurship: There main purpose is to make world a better place by
creating products and services which can solve needs and problems. They are termed
as not for profit organisations.
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Typology of Entrepreneurship with Entrepreneurial ventures.
The major types of ventures mainly start from small business entrepreneurs and go up to the large
businesses. It also includes the social businesses as well as small business and start-ups. These
entrepreneurial ventures are proven to be effective in the field of marketing. The differences that
are present in these types are size of business, profit margins and investments.
Small business entrepreneurship: In today’s world, small business enterprises have become
very common one out of every three person in this world has a small business such as grocery
store, travel agency, storefront, Internet connection providers and several more. It has been
estimated that nearly half of the persons of any country, who are not employed in the
government service or private job are involved in a small business. It can be stated that small
businesses have a significant impact on the employees of the company.
Scalable Start-up entrepreneurship: Most of the entrepreneurs pursue scalable startup
entrepreneurship. The main motive of these persons is to change the face of the world by
their visions and ideas. Therefore, it can be stated that their businesses are started by the
entrepreneurs being fully aware that they are going to help in changing the face of the world.
Their main source of funding is venture capitalists and investors and their entire future
depends on them.
Large-company entrepreneurship: The size of these companies is larger and developed
through new innovation. The other strategies used by these companies are to offer new
products to the consumers that are different from the existing products. These companies also
keep a look at the changes that may come in the taste of the consumers as well as the
introduction of new technology.
Social entrepreneurship: These entrepreneurships are based on the social needs and are
famous for producing the products which can contribute in betterment of community. In such
a case, it can be stated that as compared to the other businesses, the target in this case of
entrepreneurship is to make the world a better place rather than retaining profits.
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Similarities and Difference between Entrepreneurial ventures.
The similarities between entrepreneurial ventures are in terms of market share, profit
margins, development of new ideas and innovation which leads to the growth of their
enterprise. Start-ups and large business have one thing common to innovate and develop new
product for the consumer according to the demand and market requirement and their main
motive is to earn profit and capture market. In the same way, small business are concerned
with the fulfilment of basic necessities and doesn’t earn much profit where as social
entrepreneurship is concerned with the social needs of community without earning any
money.
The differences between entrepreneurial ventures are size of business, investment, returns on
investment, market share and dominance. Every entrepreneurial venture differences in
aspects which are written above and these factors influence their style of working. In small
business entrepreneurship and social entrepreneurship profit margins and market dominance
are negligible whereas start-ups and large business have market dominance and retain huge
sum of profit by launching products and services.
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Entrepreneurial ventures in public and corporate sector.
In Public sector entrepreneurial ventures are consist of not for profit organisations or social
entrepreneurship as they contribute towards the social needs and develop products and
services which can fulfil the social demands of community. They are mainly funded by
government and other business firms and companies they raise funds through charities and
donation events.
In Corporate sector, large business, start-ups and small business entrepreneurship contributes
socially and in development of economy by launching new products and services for the
consumer and earn profits and capture market share. Corporate social responsibility is used
by these entrepreneurial ventures to deliver the social, economic and environmental benefits.
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Scope, growth and development of entrepreneurial ventures.
Entrepreneurs these days are creating products according to the change in taste and
preferences of consumer and market requirements. These factors tends to increase the
business in market which leads to increase in scope and development of entrepreneurial
ventures and these day every entrepreneur and business is interested in creation of products
through new ideas and innovation and these ideas attracts the investor and shareholders to
make an investment. In today’s era young entrepreneurs and generation people are interested
in developing their own business rather than putting efforts in 9 to 5 job for someone else,
they are ready to small start create new innovative things, so its shows the scope and growth
of entrepreneurship.
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Impact of micro and small business on the economy and apply relevant data and
statistics.
Small and micro business entrepreneurs faces challenges such as in terms of investment,
limited skilled labour and access to market is less but they provide the freedom or financial
independence, encourage to develop more innovative products, creating employment
opportunities and independence to run your own business according to your terms which
initially seems a bit difficult but later results in last longing success. The nation’s stability is in
part predicated upon a stable economy and the financial strength derived from these businesses.
Small businesses are an engine of growth that allows both citizens and the government to acquire
the goods and services they need to grow. The data is shown below in regards with micro and small
business and retained profit share.
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Importance of small business and start-ups in the growth of social economy.
Small business contributes to local economies or community by developing the innovative
products and contributes in growth where business has started running their operations and
provide employment opportunities to those individuals who are not employed at large
corporations or business houses. Small businesses accounted for 99.3% of all private sector
businesses at the start of 2018and 99.9% were small or medium-sized and total employment
in SMEs was 16.3 million; 60% of all private sector employment in the UK. Start-ups create
economic activity, provide jobs and it acts as an engine to initiate the change by offering
products and services throughout the country which can ease the life of consumer in every
possible way. It helps in improvement of technology which is an advantage of a nation in
future development and growth of economy and creates increase in nation’s GDP, creation of
wealth by using investor’s money as start-ups grows which directly contribute in benefit of
nation’s people.
It is commonly believed notion that economy of a country is dominated by big business
houses. On certain levels, it is quite true, but not many people are aware of the fact that the
small scale businesses or start-ups also play a role in increasing the growth of the economy.
These businesses or start-ups bring with them new innovations, new local jobs and also
provide competition to their existing competitors. As per the records of the “Global
Entrepreneurship Monitor” (GEM) research, a new entrepreneur with new ideas and high
potential creates 4 times more job than existing companies. This results in 12% increased
annual growth and also contributes to the economic development of the society.
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Evaluate the differences small, medium and large businesses make to the economy, applying
relevant data and statistics.
There are many differences between a small, medium and large business such as decision
making, resource allocation, risk factors and many other factors which are briefly explained
below:
Decision Making: In large companies decision making involves approval from hierarchy
which consumes a lot time when immediate approvals are required for some work and these
delay in results affects the performance of business. Small business are better in comparison
to larger one’s decision made at the time of urgency which leads to the growth of these
enterprises rapidly.
Resource Allocation: In small business few resources are available and are allotted
accordingly which can fulfil the work purpose where as large companies have abundant
resources employee use these resources freely in comparison with smaller business.
Innovation: The innovation of new products and services leads to increase in competition and
to deal with these competition companies need to make huge investments to sustain in market
which provide consumer according to their choice. Here, Small business have less scope due
to limited source of funding.
Risk factor: Large business can take bigger risk as they have resources required to operate the
business and they can make huge investment in other companies and earn profit in
comparison to small business. Small business cannot take bigger risks as they don’t have
much resources which can back them up if any uncertainties happen.
In 2018, UK had 5.7 million Small business enterprises which was 99% of all the business.
Micro business have 0-9 employees and 8,000 large business with 250 employees.
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