Entrepreneurial Activities and their Economic Impact in the UK

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Running Head: ENTREPRENEURSHIP AND SMALL BUSINESS MANAGEMENT
ENTREPRENEURSHIP AND SMALL BUSINESS MANAGEMENT

ENTREPRENEURSHIP AND SMALL BUSINESS MANAGEMENT
Table of Contents
Introduction......................................................................................................................................4
LO1 – Illustrating and exploring the different types of entrepreneurial ventures...........................4
Examining several types of entrepreneurial ventures and their relation with the topology of
entrepreneurship [P1]...................................................................................................................4
Exploring the similarities and differences between different types of entrepreneurial ventures
[P2]...............................................................................................................................................5
Investigating a diverse range of entrepreneurial ventures to demonstrate and understanding of
entrepreneurship in both public and corporate sector [M1].........................................................6
Critical examination of the scope, development and growth of entrepreneurial ventures [D1]. .7
LO2 – Assessing the impact of small businesses on economy........................................................7
Integrating and accessing the impact of micro and small business on the economy of a nation
using statistics and other relevant data [P3].................................................................................7
Importance of small business and business startups to the growth of social economy [P4]........8
Evaluating the differences made by small, medium and large businesses to the economy
applying statistics and relevant data [M2]...................................................................................8
Critical examination of the impact of small businesses at different levels on the economy
including local, regional, national and international levels [D2].................................................9
LO3 – Assessing the key aspects of an entrepreneurial mindset.....................................................9
Determining the characteristic traits and skills of a successful entrepreneur that differentiates
them from other business managers [P5].....................................................................................9
Assessing the reflection of entrepreneurial mindset and motivation through the aspects of
entrepreneurial personality in an entrepreneur [P6]...................................................................10
Exploring and examining different lines of argument relating to characteristics of an
entrepreneur [M3]......................................................................................................................10
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ENTREPRENEURSHIP AND SMALL BUSINESS MANAGEMENT
Analysis of the characteristic traits, skills and motivational drivers of successful entrepreneurs
along with specific examples [D3].............................................................................................11
LO4 – Examining the different environments that foster or hinder entrepreneurship..................11
Examining the influence of experience and background in hindering or fostering the qualities
of entrepreneurship with relevant examples [P7]......................................................................11
Analyzing the link between entrepreneur real characteristics and the influence of personal
background and experience for some specific successful entrepreneurs [M4]..........................11
Critical evaluation of the positive and negative influences of background and experience on
entrepreneurs along with contrasting and comparing using examples [D4]..............................12
Conclusion.....................................................................................................................................12
Reference List................................................................................................................................14
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ENTREPRENEURSHIP AND SMALL BUSINESS MANAGEMENT
Introduction
Self employment and entrepreneurship has become a popular trend in the existing market
scenario of business since the last few years. The entire business world had experienced an
unfavourable session of unemployment and recession in the early few years of 21st century.
Millions of people all over the world had lost their jobs during the ongoing recession. As a result
of this, many people often for a new idea of self employment and establishing their own business
establishments to employ other people. This was the time when entrepreneurship was at its peak
and it has been evolving since then for better. A huge portion of the British economy is
supported by small businesses and Entrepreneurship related activities. Hence, the following
studying is about the impact of entrepreneurship and its associated activities on the British
economy. The study has explained different types of entrepreneurial ventures along with the
similarities and differences between them. The impact of different types of businesses on the
entire British economy at local, regional, national, and international levels have been discussed
by collecting facts and statistical figures. The report has also discussed about the major qualities
that are required to become an entrepreneur and has explained the characteristics traits and skill
sets that differentiate between successful entrepreneurs and other businessmen.
LO1 – Illustrating and exploring the different types of entrepreneurial
ventures
Examining several types of entrepreneurial ventures and their relation with the
topology of entrepreneurship [P1]
There are four major types of entrepreneurship associated ventures that exist in United Kingdom.
These are the Small business entrepreneurship, scalable startup entrepreneurship, large
organisation entrepreneurship, and Social entrepreneurship. The Small scale business
entrepreneurship includes small businesses that are operated by an individual or a small group of
people. These are usually the commonly found business like carpenter shop, General Stores,
vehicle repair shop, and other similar businesses. This type of business requires some small
amount of funds and can be conducted without having a specific skill set but some knowledge
about management of resources. The scalable startup entrepreneurship is about working towards
a specific direction to bring a Revolutionary change in the existing market. The primary
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requirement for a scalable Startup entrepreneurship is to have a group of creative and innovative
thinkers. This requires a significant amount of fund so that their research and development
related activities can be conducted. The funds are usually collected from sponsored people for
the proprietor(s) of the entire project (Ludvig et al. 2016).
The large scale organisation entrepreneurship is a practice that is carried out by already
established organisations to encourage creativity and innovative thinking among its employees.
The primary objective of a large scale organisation entrepreneurship is to develop innovative
products to attract more customers and retain the same for a longer duration. The entire funding
is sponsored by the company or by the stakeholders of the organisation. The fourth type of
entrepreneurship is the Social entrepreneurship that is done by an individual or a group of
individuals or even an organisation with the objective of providing some social help to people.
This type of entrepreneurship activity does not require any special skill our talent but requires a
high level of dedication towards the social services. The funding for Social entrepreneurship
comes from charity donations by individual people and organisations through corporate social
responsibility actions (Brush et al. 2018).
Exploring the similarities and differences between different types of entrepreneurial
ventures [P2]
The most common similarity between all the different types of entrepreneurial ventures is that it
requires a high level of dedication and innovative or creative vision. Moreover, the necessary
qualities of an entrepreneur like never giving up despite failures, building contact with people to
increase network, and managing time and other resources are equally important for all the
entrepreneurial venture types. However, there are some major differences in the above
mentioned it types of entrepreneurship activities. The Social entrepreneurship requires leadership
qualities where an individual can easily communicate with different people and convince them
for serving for a social cause (Chou, 2018). The large organisation entrepreneurship requires
proper study of the market and implementing innovative ideas to make the existing products
even better. The risk of negative consequences due to failures is quite low because the
organisation already has a huge reservoir of fund. The scalable startup entrepreneurship requires
a high level of focus because it is full of risk and is likely to backfire in case it fails. This is
because of the non availability of huge funds. It is very important to have a creative workforce
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that can withstand the high level of competition in the market. The small scale businesses are
about opening a local store which might be already present in the market. The risk of failures is
very low in this type of business because small scale entrepreneurship is about providing
products and services of basic necessities to the people (Malmström et al. 2017).
Investigating a diverse range of entrepreneurial ventures to demonstrate and
understanding of entrepreneurship in both public and corporate sector [M1]
The entrepreneurship related activities are generally carried out in a corporate sector because
corporate business companies are more likely to invest and carry out research and development
projects for innovation. The main objective behind this is to keep on improving the products and
services of an organisation in terms of quality to attract and retain maximum number of
customers. The entrepreneurial venture activities in case of scalable startup entrepreneurship and
large organisation of entrepreneurship involve some revolutionary design or technique that is
likely to change or replace an existing product in the market. This can be a specific product that
satisfies basic household requirements of people or it can be some revolutionary product that will
forever change the method of execution of an activity. A prominent example is that of film
cameras being replaced by digital cameras since the introduction of digital technology. The
digital single lens reflex camera or DSLR cameras have been revolutionary in the field of
photography. Similarly, the introduction of mirror less cameras in the recent few years is also a
product of innovation in the corporate sector (Moses et al. 2016).
On the other hand, innovation can also be witnessed in the field of public service sector. The
public sector innovations are more likely to be oriented towards serving the people in a better
way for social cause instead of earning more profit margins. There have been other players who
have created new ways of paper disposal and invented machines that can dispose the waste
papers and recycle them into brand new A4 sheets within few minutes. This can be termed as an
example of entrepreneurship in public sector because the primary aim is to serve the people.
Moreover, the organisations operating in public sector also fund entrepreneurship related
activities like inventing some innovative device that can collect the harmful pollutants emitted
from vehicles and convert the same into ink that can be further used in pens for writing purposes
(Johnsen and Sørensen, 2017).
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Critical examination of the scope, development and growth of entrepreneurial
ventures [D1]
The entrepreneurial ventures have seen a significant development and growth in the recent few
decades with the introduction of internet. The easy access to internet has reduced the distances
between people living distance apart geographically. People living at huge distances from each
other can easily communicate using internet due to which they have discovered many
opportunities. As a result of this, innovative services have gained more popularity because it has
become very easy to share any innovative invention with people all over the world in a matter of
few minutes. Moreover, the basic information that is usually the outcomes of research activities
are easily available from online sources that can be used to produce innovative items. The
government has also supported entrepreneurship in United Kingdom due to which almost 90% of
the total private companies comprise of micro, small and medium sector enterprises that have
been established by entrepreneur as (Metaxas and Karagiannis, 2016).
LO2 – Assessing the impact of small businesses on economy
Integrating and accessing the impact of micro and small business on the economy of
a nation using statistics and other relevant data [P3]
The GDP of United Kingdom is the fifth highest in the world with almost 2.8 trillion US dollars
in the year 2018. The micro, small, and medium sector businesses contribute approximately 52%
of the total GDP that comes from services and manufacturing sectors in United Kingdom. There
are almost 90% of the total private sector organisations that operate in United Kingdom as
entrepreneurial ventures. Hence, it can be said that the micro and small business sector
companies have a significant impact on the overall development of an economy. These small
businesses help the country reduce the rate of unemployment at local and national levels in the
country due to which the government has to face lesser burden to provide subsidies to the people
for medical facilities and education. Moreover, due to the huge revenue collection from micro
and small sector business companies entrepreneurial ventures, the government can accumulate a
huge fund reservoir or Foreign Exchange Reserves that are very helpful to deal with emergency
life situations in the country (Holmberg-Wright and Hribar, 2016).
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Importance of small business and business startups to the growth of social economy
[P4]
The small businesses and startups are very important for the growth of the economy of any
country because the total investment that is required to be done to establish a small scale
business is very less compared to that required to setup a large scale business organisation.
Moreover, the smaller groups that it carries out an entrepreneurship related activity is more likely
to be focused towards a specific work. Therefore, the market research can be conducted in a
focused manner that is more likely to result into some positive outcomes based on which the
entire business model can be established that can be potentially beneficial for the organisation.
Small scale business startups also allow the people of a country to carry out small activities for
their livelihood and connect the gaps between major industries. An effective example is the
production of packaging products that is used by large scale companies to package the items
processed by them (Kerr, 2017).
Evaluating the differences made by small, medium and large businesses to the
economy applying statistics and relevant data [M2]
The total contribution of small and medium scale industries to the GDP of Britain in 2018 was
52%. On the other hand, the rest of the GDP of Britain was achieved from the small scale
industries. This means that a sum of almost 1.5 trillion US dollars was earned by the large scale
organisations in the financial year that ended in 2018. Small scale sectors have a prominent
advantage that at the infrastructure and other similar resources required establishing a business is
very less. Moreover, the creativity of people can be easily determined in small scale
entrepreneurship related activities. However, a significant disadvantage for small scale
entrepreneurship business is that the total value of fund reserves is very less. On the other hand,
the large scale businesses operate on a huge scale in terms of financial and human resources
aspects. The large scale companies are more likely to employ a huge population that can further
reduce the overall business employment burden on the country’s government (Ng and Kee,
2018).
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Critical examination of the impact of small businesses at different levels on the
economy including local, regional, national and international levels [D2]
The small businesses significantly impact on locals levels of a country. The most effective
consequence can be seen when the organization is established at a local level an employs the
local population using the locally available resources, it is generating employment at minor
levels. There have been many examples when the people of local vicinity have established a
tourist spot due to the presence of some unique heritage in the locality. Hence, the place was
promoted well using different media sources and all the possibilities of self employment and
entrepreneurship were explored by the people. Many people built hotels and resorts at those
locations in order to welcome the tourists providing them proper hospitality services. Hence, the
entrepreneurship activities affected the economy at a local level. Similar things happen with the
country at a regional level when the entrepreneurship expands into a medium scale business.
More people are employed that generates even more income for the company due to which the
organization is able to pay higher taxes. The national level impact can be identified by the
significant growth in the overall revenue of the private sectors and total GDP of a country. The
international level impact of entrepreneurship usually results into the improvement in
international relations with other countries along with better diplomatic ties (Meyer et al. 2016).
LO3 – Assessing the key aspects of an entrepreneurial mindset
Determining the characteristic traits and skills of a successful entrepreneur that
differentiates them from other business managers [P5]
There are some specific characteristics that are possessed by the successful entrepreneurs that
differentiate them from other business managers. The managers are generally expert in their
domain that involves some work to be done as per a specific set of rules. However, the
entrepreneurs are capable of making new ways and innovating new techniques of undertaking a
work. The entrepreneurs have a unique quality of never giving up despite facing multiple failures
while moving towards their goals. Moreover, they are also great at making connections as they
know the value of a big network. A successful entrepreneur is a regular reader and he can deliver
motivational speeches to his colleagues and subordinates like a worthy leader. Proper time
management and resource management are few other qualities possessed by the successful
entrepreneurs (Mathias et al. 2017).
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Assessing the reflection of entrepreneurial mindset and motivation through the
aspects of entrepreneurial personality in an entrepreneur [P6]
The successful entrepreneurs are highly dedicated towards their work and always have a positive
and confident mindset towards their responsibilities. They have a well designed and planned
roadmap towards any activity and hence they can easily deal with any situation. They have the
courage to take risks and are very well aware of the fact that they can fail in it. Therefore, the
successful entrepreneurs do not get disheartened after facing defeats and learn from their
previous mistakes to use their experience in the upcoming future. The learning urge is always
present in successful entrepreneurs and they take important knowledge from every possible
source. The mindset of a successful entrepreneur is that of a leader that doesn’t let his teams feel
low. There is a constant support from the leader or entrepreneur is to the employees in terms of
moral boosting and technical help regarding work (Chowdhury, 2017).
Exploring and examining different lines of argument relating to characteristics of
an entrepreneur [M3]
The two main different types of characteristics of an entrepreneur are being strict and being
lenient. There are positive as well as negative aspects of both the types of behavior shown by the
entrepreneurs. There are many people that believe that being strict at workplaces is a very good
practice because the employees are more likely to work seriously for the company if the leader is
very strict. Hence, there are some entrepreneurs that are very strict about work quality of work
and deadlines. They are known for not compromising with their rules under any circumstances
even if they have to take some strict action against their subordinates. However, there is a
drawback that it might create some differences among the employees from different
designations. On the other hand, there are some people that believe that the entrepreneurs that are
a bit lenient with their employees are more likely to be successful in their professions. They
believe that having leniency towards the employees make the leaders bond well with their
subordinates. Hence, the people are more likely to be more loyal to the organization. However,
there is a negative side as the lenient behavior of an entrepreneur might compromise with the
deadlines and work quality (Khor, 2017).
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Analysis of the characteristic traits, skills and motivational drivers of successful
entrepreneurs along with specific examples [D3]
The main source of motivation for the successful entrepreneurs is the internal self motivation that
arises due to a passionate feeling towards a goal. There are some entrepreneurs that want to do
something for the people and country. Hence, those people are highly motivated towards
achieving their goals and are likely to develop the traits of a successful leader or an entrepreneur.
In order to attain the decided objectives, the entrepreneurs can build contacts and get information
from all the necessary sources. This also makes the entrepreneurs try new things and develop
new skills that are useful for the future (Martin, 2015).
LO4 – Examining the different environments that foster or hinder
entrepreneurship
Examining the influence of experience and background in hindering or fostering the
qualities of entrepreneurship with relevant examples [P7]
The background and experience of an entrepreneur usually has a significant impact on the
qualities of the person. A growth and development friendly environment for potential
entrepreneurs is highly beneficial. An individual person that has made proper use of all the
available resources during childhood is more likely to develop the qualities of an entrepreneur.
Similarly, the qualities can be hindered in case the person does not make proper use of the
resources. There are people that spend their childhood in poverty but become successful
entrepreneurs in the future. This is because their qualities of entrepreneurship are fostered by the
urge to make their lives better and making complete use of limited resources (Vamplew, 2018).
Analyzing the link between entrepreneur real characteristics and the influence of
personal background and experience for some specific successful entrepreneurs
[M4]
An individual that has received all the modern facilities during childhood can easily develop his
skills of creativity that will be useful for future entrepreneurial goals. However, the same
individual can damage his talent if he wastes these opportunities. On the other hand, an
individual that does not has access to modern facilities and has spent childhood in poverty
background can make use of all possible resources to complete the tasks. However, many people
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also believe that the people from poverty background are not able to develop their creativity
related skills and therefore they cannot become great entrepreneurs. It is also very important for
an entrepreneur to have an ample amount of experience so that he has knowledge about the
possible outcomes. Working as an employee for some other organization is often very helpful for
any particular individual to identify the main aspects of doing business based on which the
entrepreneur can make the structure of his own business (Robinson et al. 2017).
Critical evaluation of the positive and negative influences of background and
experience on entrepreneurs along with contrasting and comparing using examples
[D4]
The most prominent positive aspect of having a resourceful background from the perspective of
an entrepreneur is that the individual can develop his own use of creativity and innovation by
experimenting with all the resources. However, it also has a negative impact on the personality
of a person because every individual that is able to get every work done sitting idle is likely to
spend time doing nothing and wasting the same watching useless activities. On the other hand, it
can be said that the people that come from poor background have a positive influence that they
can easily make use of the smallest available resource with them. This quality is obtained not
observed among the people coming from rich background. It can also be said that the people are
very effective in cost cutting as they can easily identify the areas where an organisation is
investing unnecessarily. However, a negative quality is that due to the left of availability of
resources, the thinking and perspective of those people are far away from entrepreneurship in
some cases (Coulson-Thomas, 2017).
Conclusion
Entrepreneurship related qualities are often present in an individual from the beginning.
However, there are some people who have a positive influence of their environment and make
use of their skills and talents to become successful entrepreneurs. It can be said that
entrepreneurship has a great scope in the upcoming future because the variety of demands and
requirements for customers is increasing rapidly. Hence, it is providing a wider scope of
development and growth for entrepreneurship sector in United Kingdom and in other parts of the
world. The governments of every country must encourage startups and entrepreneurship related
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