Entrepreneurship and Small Business Management Report

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ENTREPRENEURSHIP AND SMALL
BUSINESS MANAGEMENT
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Table of Contents
TABLE OF FIGURES......................................................................................................................... 3
INTRODUCTION............................................................................................................................. 4
TASK 2............................................................................................................................................ 5
TASK 3.......................................................................................................................................... 17
CONCLUSION............................................................................................................................... 26
REFERENCING.............................................................................................................................. 27
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TABLE OF FIGURES
FIGURE 1: FINANCIAL DATA OF UK ECONOMY..............................................................................6
FIGURE 2: BUSINESS SHARE IN UK ECONOMY...............................................................................7
FIGURE 3: CHALLENGES FACED BY THE SME'S IN UK, 2018...........................................................9
FIGURE 4: SME'S DATA BY REGIONS IN UK..................................................................................11
FIGURE 5: NUMBER OF BUSINESSES (SME'S) IN UK.....................................................................12
FIGURE 6: THE CONTRIBUTION OF THE SME'S IN SPAIN (EU)......................................................14
FIGURE 7: NUMBER OF SME'S IN NETHERLANDS.........................................................................15
FIGURE 8: THE BIG FIVE MODEL...................................................................................................21
FIGURE 9: MASLOW’S PYRAMID..................................................................................................23
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INTRODUCTION
Entrepreneurship ventures have become very trending in the modern world. Almost all the new
organizations are working and establishing their business based on the concept of
entrepreneurship in which the main idea is to promote and bring innovation in the products
and services to earn higher profit. In this assignment report, various aspects of the
entrepreneurship ventures will be discussed, it has also been analyzed in different reports that
UK's economy is supporting entrepreneurial ventures because they are contributing to the
greater extent in maintaining the economic condition of the country. The assignment will
be completed in three tasks in which the first task will be a presentation explaining the different
entrepreneurial ventures and activities related to them, the second task includes preparation of
report describing the impact of the SME's on UK's economy. The last task will include an essay
in which entrepreneurial mindsets and their backgrounds will be discussed in detail.
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TASK 2
INTRODUCTION
Entrepreneurship is the concept of bringing something new that help in satisfying customers
along with earning huge profits (Kirzner, 2015). This section of the assignment will include the
individual report discussing the various impacts of entrepreneurship ventures and small
businesses on the economy of the UK. And the significance of the small and entrepreneurial
business that supports the growth of the economy. This report is to be prepared by small
business consultants in a startup business (Chang and Wyszomirski, 2015).
BODY
A.
DEFINE SME
The small, medium and the micro-enterprises can be explained as the businesses in the number
of employees and their turnover is set to a certain limit and they cannot exceed that limit that
is decided by the UK government. The defined limit for the SME is that the organizations which
do not have the employees more than 250 persons and also their annual turnover cannot
exceed the limits of the 50 million euros (Xu, M et al., 2016).
EVALUATION OF THE GROWTH AND THE CONTRIBUTION IN FINANCIAL TERMS BY THE SME’S
TO THE UK’S ECONOMY
The increasing number of startups and the entrepreneurial ventures are contributing to the
greater extent to the UK’S economy (Cooke, 2018). the industrial and the manufacturing sector
of the econp0myu are contributing a lot especially in providing opportunities for jobs, but this
has also become a major concern that youths and other business generation persons are not
likely to do the job. With the development in the entrepreneurial sectors, people's perception
has changed and they are ready to take the risk of starting a business startup for more profit
generation. According to the current situation, the SME's has become the UK economy's
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backbone because of the higher contribution in many areas. The SME's are providing new
markets, helping in exploring new areas and providing with many different opportunities that
lead to economic growth as well as development (Cooke, 2018).
The development in the small as well medium enterprises is increasing day by day, their
contribution in the year 2018 was 99% as compared to the overall business in the UK. Here is
the recent data used from the recent reports of the UK economy that Small, medium and micro
enterprises cover almost all the part of the UK and they are helping in improving the economic
condition of UK (Giaoutzi, 2017).
FIGURE 1: FINANCIAL DATA OF UK ECONOMY
[SOURCE: STATISTA, 2019]
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The above recent report clearly states that the small, micro and medium enterprises are
contributing to the greater section of the UK (Giaoutzi, 2017). The major contribution from the
micro businesses was 33% of the employment as well as an increase in turnover by 21%. It has
also been seen the more than or up to 96% of the business organizations in the UK have the 10
or less personnel working with them and this is the huge contribution that could help in the
future generation.
The contribution by the SME's in the year 2018 is also represented by the graph in which it is
clearly defined that businesses have shifted from large to small, micro and medium businesses.
FIGURE 2: BUSINESS SHARE IN UK ECONOMY
[SOURCE: STATISTA, 2019]
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The above graphical presentation shows that the number of a micro business in the UK is
highest in 2018, their contribution to the employment sector is 33% and the overall turnover is
21%. The small business is 4% and contributing to 15% of the employment opportunities and
15% turnover rates. There are almost 1% of the medium enterprises and those who contribute
to the employment of 13% and 15% turnover. Thus this is clear with the statistical data and the
figures that the SME's are playing the major role in the development and the growth of the
economic condition (Giaoutzi, 2017).
The changes in the political conditions in the UK have affected the growth as well as the
development of the UK's SME sector. With the introduction of the BREXIT, many changes have
taken place, the major impact has been on the capital investment in the SME'S that has been
reduced through BREXIT (Giaoutzi, 2017). It has been recorded in many reports that
organizations those who were dependent on the import items and those who were working the
technology services related industrial sector have experienced greater change.
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FIGURE 3: CHALLENGES FACED BY THE SME'S IN UK, 2018.
[SOURCE: STATISTA, 2019]
There are many challenges that are faced by SME's in the UK economy (Kuratko, et al. 2015).
This has been analyzed that due to the changes in the factors such as political, potential as well
as the economic condition, the SME's has to face many challenges to grow in the market and to
establish their own businesses with higher profits. The most challenging task for SME's is to
attract customers, which means they are lacking either in providing consumer satisfaction or in
explaining their objective that is beneficial for the consumers (Kuratko, et al. 2015).
However, the discussion concludes that SME's are important for the economic growth of the
country but there are still many improvements needed and a lot of the work has to be done.
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B.
EXAMINING THE SME ROLE AND THEIR CONTRIBUTION TO THE NATIONAL ECONOMY AND
EXPLAINING THE IMPORTANCE OF THE BUSINESS STARTUPS IN THE ECONOMIC GROWTH
UK startups significant in the growth of the UK economy, the SME's has proved to be the major
sources of the growth in many areas in the economy. Small businesses are not only helpful in
proving the various job opportunities but also with the establishment of the new small business
people are moving towards standardization in their lifestyles (Storey, 2016). The SME's are
bringing new things and new markets for the people, with the help of the SME’s the country is
able to use advanced technology because of the innovative ideas and the products offered by
the SME’s (Storey, 2016). The communication among different businesses and different
countries are also increasing and the economy is moving towards improvement in overall
terms. Therefore this is very clear that SME’s are playing the major role in the development of
the UK economy.
a) Comparing the impact of the SME’s for 2 UK regions
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FIGURE 4: SME'S DATA BY REGIONS IN UK
[SOURCE: STATISTA, 2019]
The two regions of the UK such that London and the northeast, these areas have the highest
number of businesses in the UK and their comparison is given through the data that is
explained in the table (Storey, 2016). There are almost 1563 businesses in LONDON per 10,000
residents and when looking on to the NORTHEAST region, there were only 749 businesses that
are SME'S. In a nutshell, it was analyzed that one-third of the UK's businesses are there in
LONDON.
b) Comparing SME's impact on the UK utilizing different industries such as construction
and retail
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FIGURE 5: NUMBER OF THE BUSINESSES (SME'S) IN UK
[SOURCE: STATISTA, 2019]
A major comparison has to be done with the retail as well as the construction industry in SME'S
in the UK. It has been clearly shown in the above table that the retail industry or the sector is
contributing or the retail sector accounts for the overall 10% of all the businesses (Storey,
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