UNIT: 09

ASSIGNMENT TITLE: Entrepreneurship and Small Business

Management
STUDENT NAME: Shehryar Saeed
TUTOR NAME: Raja Sohaib
INTERNAL VERIFIER NAME: Malik Abdul Naveed

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Table of Contents

:
Learning Outcome 1....................................................................................................................................3
Learning Outcome 2....................................................................................................................................6
Learning Outcome 3..................................................................................................................................11
Learning Outcome 4:.................................................................................................................................13

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 Introduction of Entrepreneurship:
Entrepreneurship can be defined as the ability and willingness to develop, organize and manage a
business startup, being aware and mindful of any of its risks that come along with it, in order to
make revenue and profit.

Learning Outcome 1

LO1: Explore and illustrate the range of venture types that might be
considered entrepreneurial.
Definition of Entrepreneurship:
Entrepreneurship is defined as the process designing and willingness to develop, organize and
manage a business startup, being knowledgeable of any of its risks that come along with it, in
order to make revenue and profit. The common example of entrepreneurship is introducing a
new idea in market.

An entrepreneur’s goal is always to create something new or different and great to be

remembered among people and create something that would change the world in a very positive
manner for its betterment and growth. An entrepreneur is an individual who runs and finds a
small business rather than working as an employee. A good entrepreneur would always go
beyond his/her limits to achieve the goal and success for his/her innovation. There are a lot of
examples of entrepreneurs who have changed the world and created something different and
great. Few entrepreneurs are below :

 Bill Gates
 Mark Zuckerberg
 Sean Parker
 Steve Jobs

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These are the some of world greatest entrepreneurs. Which have played very important role in
the economy of the world. These people have the skills and dedication necessary to anticipate the
future needs and bring good new ideas to the world. Entrepreneurs become successful by risking
everything for their start-up and they keep hustling and working hard to be rewarded with profits,
fame, respect and continued growth opportunities. They add more value than anyone else and
success follows them.

What is difference between Serial Entrepreneur, Intrapreneur and Owner-Manager?

There are different types of Entrepreneurs. Some of which are explained below:
Serial Entrepreneur: A typical entrepreneur is an entrepreneur who comes up with a single idea
and a serial entrepreneur is known as an entrepreneur who continuously comes up with new
ideas and is always motivated to start new businesses.
The instinct of a serial entrepreneur is to come up with an idea and as soon as his idea is
envisioned, he would hustle to get things started in order to turn that idea to something great,
give its role and responsibility to someone else and start coming up with new ideas and get
things done for that one.

Intrapreneur: An intrapreneur is basically an inside entrepreneur, who uses entrepreneurial

skills without risking its associates with those activities. Intrapreneurs are known to be the
employees within an organization who are working on something new and different from market,
an idea that would be different or a project etc, with enough resources given by their own
organization.

Owner-Manager: An owner-manager is someone who spend their time and energy on present
goals. Internally they focus on the market. Their main target is to sale goods and earn profit.
Classification of Entrepreneurship:
Entrepreneurship is classifies into two parts
 Lifestyle firms
 Growth firms
Lifestyle firms: Lifestyle firms are known as progress that provide an reasonable income/living
for their founders. Lifestyle firms are basically small business with no immediate plan for
growth. These firms are known to rely on internal funds rather than depending on investors to
invest in their business.

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Growth firms: Growth firms are basically high imaginable firms, with a vision for growth that
are not only innovative but also risk-taking and accessible for change. Growth firms would plan
to grow into big firms with multiple employees within a specific period of time.

Entrepreneurship in a public or corporate sector:

Entrepreneurship in a public sector:
Entrepreneurship in a public sector refers to the measures adopted and developed by local and
regional authorities to support self-employed entrepreneurs to start their own business and
support them through developed networks. This sector includes all the innovative ways of action
and acting of public powers that are required to promote economic growth and reasonable
development.

Entrepreneurship in a corporate sector:

Entrepreneurship itself is generally understood as the creation of new ideas and products. It can
also be seen in the corporate or public sector context too. Corporate entrepreneurship involves
different kinds of innovative activities such as the development of new products and
technologies, along with changing organizational methods and structure. Firms that would show
corporate entrepreneurship are the ones who are able to take advantage of coming opportunities
and gain success in their growth and business performance and also gain a great competitive
advantage in the market.

Micro and small organizations:

Micro Organization: A micro organization is a small business firm that employs only few
employees. A micro organization would usually operate with very less people and start with a
small amount of investment. A micro organization is quite vital as it serves to improve the
quality of life for the people living in developing countries. These organizations can take small
loans through micro-finance which helps and allows poor individuals or families to start their
own businesses and earn income to run their home monthly expenses.

Small Organizations: Small organizations/businesses are the ones that are privately owned
organizations, partnerships, or sole-traderships that would have few employees and perhaps a
low amount of annual income as well. These would include bakeries, barber shop and grocery
stores etc.

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Social Enterprise: A social enterprise is known as a commercial organization with certain social
objectives that seek to maximize profits while giving benefits to society and environment. Profits
earned through these organizations are used in the funding for social programs.

Social Entrepreneurs: A social entrepreneur is a person who make an enterprise that have the
potential to solve problems that would be community-based. Social entrepreneurs always move
forward, take risks and make efforts to bring change in the society through their ideas/initiatives.
Examples of social entrepreneurship would include points such as, microfinance institutions,
educational programs and helping children orphaned by wide-ranging diseases. A social
entrepreneur’s goal is not to earn a profit, but rather to introduce innovative products in the
society. While most entrepreneurs would seek ways to earn great profits, a social entrepreneur
would choose the non-profitable path to bring change in the society.

Social Economy and its growth:

The social economy can be defined as the third sector of mixed capitalist economies separate
from private and public sectors and is based on cooperative, non-profit, and voluntary activities,
rather than paid activities carried out within communities and internationally. The social
economy is well defined by the collection of diverse social objectives of different organizations
that make it up according to their requirements. A number of social economy
organizations/companies would simply deliver services to their members or others without
making any sort of use of the market. Social economy has now been recognized has a great
aspect of a society and is growing rapidly among developing countries, making it really better for
the communities and the individuals too.

Learning Outcome 2

LO2: Assess the impact of small businesses on the economy.

Entrepreneurs are always brainstorming for a business due to their passion. Passion is what keeps
them going, they achieve their goals because of their passion. Entrepreneurs think long-term and
always ask themselves, will they be doing this for the next 10 years or where will they be in

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The next 10 years. The intersection of passion and strength is a potential idea for entrepreneurs.

Creativity and Innovation: Creativity is known as the capability or act of considering

something original, unique and unusual and innovation is defined as the implementation of
something new and different. Basically, creativity is an imaginative process and innovation is a
productive process. Creativity is thinking about something new and different and innovation is
about introducing something new and different. Being different is what keeps entrepreneurs
separate from others. The ‘being different’ mind set helps their creativity and innovation
processes.
Innovation can be anything, for example: new technology, new idea, new product and a new
method of manufacturing .
Thus, innovation is very closely tied to creativity and putting creative ideas into action is an
innovation.
How to generate new business and entrepreneurial ideas:
The concept of generating new business and entrepreneurial ideas very essential for
entrepreneurs, as they know and understand how new business ideas can change the level of
business processes that will consistently lead to greater productivity and success for them.

It is a well-known fact that for any business venture to experience growth and progress, three
factors are very important and must come together in application and practice, these are: Idea,
Creativity and Innovation. Below are some of the more frequently used sources of idea for
entrepreneurs:
 From consumer or target audience
 From existing products and services
 From research and development
 From the government of the day

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From consumer or target audience: It is said that every creative and innovative
entrepreneur must always take good care of his/her potential customers on a continuous basis.
Customers’ opinions and advices are a big source for generating potential ideas and this is
usually achieved through a comprehensive survey or a forum.
However, the ideas that are generated from the customer/target audience should be to a large
extent and represent enough market to support a new venture of business or perhaps grow the
existing business.

From existing products and services: Products and services can also be a source of
generating new business ideas and thus, should be carefully monitored and taken in for
evaluation to uncover ways to improve them. This might result in a new product or service that
has more market appeal along with better sales and profit potential.

From research and development: The greatest source of generating a new business idea
is the entrepreneur’s own struggle and effort in research and development. Every entrepreneur
has his/her own struggle and therefore, must do the work on his/her own, just to prove to the
world that there is, in fact, no better source of generating business ideas other than, themselves.

How businesses protect intellectual property rights:

Intellectual property rights are basically known as rights that are owned by an individual or a
company, in order to have exclusive rights to use their own plans, ideas, or other elusive assets
without the worry of market’s competition, at least for a certain time period. These rights usually
include copyrights, patents, trademarks, and trade secrets. These rights may be enforced by a
court via a lawsuit. The reason intellectual property rights exist is to discourage any company or
individual to steal or take credit for an idea that were never theirs.
Ways to protect Intellectual property rights:
Business owners and entrepreneurs must protect their own Intellectual property (IP) rights, and
ensure they don’t trespass on the IP rights of others. To do this, a plan must be placed and
practiced.
There are three main areas of a business that should be protected:
 Brand name and logo
 Patents
 Design registration.

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Brand name and logo:
The way companies/organizations can fully protect their brand name and logo is by registering
them as registered trademarks. However, just because companies have registered a business
name with the Registration Office, doesn’t mean that it can’t be copied or stolen by someone
else. A trademark is any unique sign that can differentiate the products and manufacturing of one
brand from another and can also be represented graphically, such as Coca-Cola or Pepsi etc.

Patents:
A patent is an exclusive right that is granted for an invention of a product that provides a
different way of doing something or offers a new solution to a certain problem. It advises its
holder for a limited period of time, the right to exclude others from take advantage of the
patented invention except with the consent of the patentee. In other words, one must need
permission to even use or borrow something from the person. Same applies to companies and
brands. Patents can be considered to protect the way something works.

Design registration:
This covers aesthetic and skilful creations such as the lines and shape of a particular product or
good. Design registration is also referred to graphic designing. A skilful art/tool that is used by
companies to print/create their own logo and protect the way a product looks.

The role and importance of small firms:

There’s an old saying that goes, “Small businesses are the backbone of the community.” It’s true
since small businesses are known to provide opportunities for entrepreneurs, jobs for people etc.
It is also true that running a small business isn’t all sunshine and rainbows, it comes with a great
risk. Starting with a small business is very good if you want to get succeed in life rather than
risking your future with a big business or industry directly. And this risk is what perfectly
defines an entrepreneur.
Small businesses are important not only because they provide opportunities for entrepreneurs,
but also create meaningful jobs, which ultimately helps reduce unemployment and provides great
job satisfaction too. These businesses support the locals and communities etc. Small businesses
also help increase economic growth by providing employment opportunities to those who would
perhaps not be employed by larger brands/organizations. Small businesses look for people who
are unique, skilful and talented and who would invent new and unique products or introduce new
upgrades to current products etc. At times, larger businesses also get to benefit from small
business, which helps them along with the economy.

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However, small businesses do not always remain small. Nike, Apple and amazon are one of the
few major examples of small business turning out to be huge hits for not only themselves but for
the whole world.
Types of small firms/businesses:
1. Sole proprietorship
2. General partnerships
3. C Corporation
4. Limited liability company

Sole Proprietorship: A sole proprietorship is a business which is own and control by one man.
It only have one owner and is not incorporated. These types of businesses are considered single-
type businesses with no plans to bring in another owner or an extra employee.

General partnership: General partnerships refer to those businesses that are owned by more
than one person, perhaps two or more people. Who invests their money, labour, property, and
skill for the success of the business. Such partnerships require each owner/shareholder to be
responsible for the company’s debts and liabilities no matter what.

C Corporate: C corporations are known as the types of businesses that are separate from an
individual owner, making them able to take special liabilities that are not available in a general
partnership or a sole proprietorship.

Limited Liability Company: A limited liability company is best known as a combination and
grouping of a partnership and a corporation. One good thing about a limited liability company is
that there are no such restrictions on the number of business shareholders. A owner has separate
liability from a business. An LLC company can have as many shareholders as needed, for
example, Google has multiple shareholders, being an LLC company.

Main factors of a LLC business are the following:

 Profit
 Turnover of a business
 Rate of Growth
 Innovation concept
 Sustainability

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Profit: Profit is main focus of a every business. If a business would have good profit ratio than it
would lead to great success. Profit is known as a financial benefit that is recognized when the
amount of revenue that is gained from an organization’s taxes, cost and expenses is exceeded. It
is a well-known fact that any profit gained by the company directly goes to the company's
owners, who may or may not decide to spend it on the business. Profit is calculated as total
revenue less total expenses.

Turnover: Turnover is known as an accounting concept that tends to calculate how efficiently a
business conducts its operations. Usually, a turnover is used to understand how quickly a
company/organization collects cash from accounts receivable or how fast it tries to sell its
inventory. In the investment industry, turnover is defined as collection percentage that is sold in
a particular month or perhaps a particular year.
Growth rates: Growth rates are known as the percentage change of a variable within a specific
period of time. Growth rates are well-known to investors for their tendency of representing
annualized rate of growth of a company’s earning, revenues, dividends or macro concepts,
including GDP (Gross domestic product) and retail sales etc.
Innovation: Innovation is known as the process of converting an idea or invention into a
working product that has value for the customers who buy that product. For an idea to be
officially termed and recognised as an innovation, it must be under a certain economic cost and
must satisfy the needs of the customers.
Sustainability: There are three columns of sustainability; Economic, environmental and social.
These are also sometimes referred to as profits(economic), planet(environment) and people
(social). The proper definition of sustainability is rather unclear but in business terms
sustainability is known to encourage businesses to make decisions in terms of years and decades
rather than on the next quarter's earnings report and to not only consider the profit or loss factors
but much more than those.

Learning Outcome 3

LO3: Determine and assess the key aspects of an entrepreneurial mind set.
The word “entrepreneurial” is taken from word entrepreneur. It is define as a person who makes
money by starting its own business especially when it involves taking risks and making new
opportunities to get succeed in society.

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The entrepreneurial mind set consists of many things but according to my opinion it consist of
following points :
1. Creativity
2. Action
3. Listening more than talking
4. Seeing the bigger picture
5. Learning from failure
6. Making an impact
For being a entrepreneur having an entrepreneurial mind set helps to achieve great things in life,
not only for the person himself but for the world and the society. Take Mark Zuckerberg, he is
known as one of the greatest Technological entrepeneur in America. He is the founder of
“Facebook” an great example of Entrepeneurship, Estimately $55.0 billion his net worth was
recorded on 30th November 2018.
An entrepreneurial mind set is what makes entrepreneurs think back of their past, then they think
of where they are today and then think ahead about what they want to accomplish in future and
be unstoppable. Entrepreneurs are those people who have a strong discipline and have solutions
to their problems.
The entrepreneurial mind set makes entrepreneurs think about their dream life daily, they see it
clearly in their creative mind, they know the price of their dream life and never let short-term
failure stop them from moving forward.
Entrepreneurs and small business owners have very unique and different characteristics than
most people and that is what truly separates them from the rest. They’re very driven to succeed.
They want to witness their start-up grow and expand into a proper established business and they
welcome any challenge they face. They are also very goal oriented, they set goals and work
towards achieving them regardless of the obstacles that would come in their way. They set goals

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to have clarity about where they are going. They’re also very confident in life as confidence is
key to gain trust, respect and success.
There’s no doubt that the majority of entrepreneurs had it tough in life. They went through tough
calamities and hardships to be what they are today. Examples include, Jeff Bezos, who started
Amazon with just a single office and barely made any revenue in the beginning. Steve Jobs, co-
founder of Apple and Pixar, started his company ‘Apple’ in a garage and later when he was 30
years old, he was fired from his own company. He was left unwanted and depressed.these two
examples are the best example of entrepreneur who had a tough life. Nothing was generally easy
for them to be great and made the world changed. However, entrepreneurs have their highs and
lows. Their highs can be very high and lows can be very low. At times, life drags them down but
it’s not the setback that matters, it’s the comeback. Entrepreneurs are known to make huge
comebacks once dragged down by life. According to my thinking, entrepreneurs are not really
born. All human beings are equal to each other but only those of us who are obsessed, passionate
and hardworking tend to be different and successful in life. Entrepreneurs are not born, they are
made. They are made through life’s endless calamities, they are made through pain, they are
made through hard work and ultimately, they are the ones who go on to change the world and
become truly successful. Anyone can be an entrepreneur, as long as the person has a goal,
envisions it, works towards it and is passionate and hardworking towards his goal, then, and only
then, will he be great and be crowned as a successful entrepreneur.

Learning Outcome 4:

LO4: Examine the different environments that foster or hinder entrepreneurship

Environment: Environment is define as a surrounding of society in which person lives. It is the
most common factor of entrepreneurship. Environment play very important role in setting up of
an entrepreneur because of the influence of various environmental factors which are described
below.

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This diagram is showing the main aspects of entrepreneurial environment. Six main factors
are menton and explained below
 Political legal environment
 Economic environment
 Socio-Cultural environment
 Domestic environment
 Technological environment
 Global business environment
1.Domestic Environment: The encouragement and guidance of various governmental and non-
governmental firms plays a vital role in the setting up of an enterprise.

2.Economic Environment: The essential economic factors like demand and supply will
determine the size of the enterprize. The surrounding of the economy will also determine the
various means of financing the business.

3. Global business financial environment: The funds required for starting up an enterprise

depends on the availability financial status and other sources of funding and the policies
followed by them.

4. Socio-Cultural environment: Worth the social and cultural factors play very important role
and demand that the enterprise is linked with the needs of the population living in a specific
society.

5.Technological and Legal factors: Making an enterprise involves fulfillment of various factors

which is linked with the market. Thus these factors have a role in setting up the new enterprise.

6. Political legal environment:Different governmental policies convincing the economy will

affect the setting up of the enterprise. Thus political factors needs to be focused while setting up
the enterprise.

Following are the factors that influence entrepreneurship and small businesses:

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There are about five key factors to entrepreneurial success and these are creativity, tolerance for
risk and responsiveness to opportunities, leadership and the ability to take advantage of the
intellectual property rights.
Entrepreneurs are never discouraged by the challenge to be creative. They don’t necessarily have
to be the original wheel creator, in fact they can take existing ideas and make small yet
impressive and much needed improvements on them. Their greatest ideas may come to them
when, perhaps, they are falling asleep or while taking a shower.
Entrepreneurs are best known for taking risks and everyone knows that great rewards rarely
come without risk. The ability to risk and take advantage of an opportunity will depend, partly,
on an entrepreneur’s tolerance for risk. Opportunities are known to leave quickly. However, with
the power of social media, information has become vast and wide-spread and ideas have led to
faster competition to be the first mover and the ability to respond to the market and new business
opportunities is what differentiates a successful entrepreneur from a failed one.
Entrepreneurs are always into leadership and inspiring others. Leadership can arise in many
forms, and was and always will be an essential aspect to entrepreneurship. Great entrepreneurs
must take the lead for their unique ideas to come to completion.
Lastly, Intellectual property (IP) laws can provide many entrepreneurs with exclusive business
rights to their ideas. If ideas are not protected, they can and will be copied.

Risks and rewards of a business start-up:

If an entrepreneur has a great idea and time to devote to that idea and be passionate about it then
he/she may still face a some positive and negative issues or various questions and criticism when
starting their own business company. Here are some of the risks and rewards of a business start-
up for entrepreneurs:
Risks:
 Inconsistent or no income
 Long hours

Inconsistent or no income:
When creating their own start up, not only do entrepreneurs truly not know about the amount of
time it would take for them to earn profit, they do not know if they will ever really make enough
money to tolerate with themselves, their employees and business as a whole.

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Variations in the economy, demographic changes, and consumer trends and styles have an
impact on the amount of revenue their business earns on a monthly basis. When starting out on
your own, years of experience in your industry and a substantial book of clients may lead to
consistent work, but even that is very rare for a brand new company. You’ll have to be prepared
to lose money the first year, possibly break even the second year, and finally turn a profit in the
third year if everything goes well.

Long hours:
Due to inconsistent income, entrepreneurs are very likely to be in need of taking the very first job
that is offered to them, which would usually be one with long hours. It may be a job that assigns
projects which perhaps they do not like, maybe they do not even like the whole job, but in order
to launch their own start up, they must work late nights to be a big hit. It’s like the famous saying
that goes, “Struggle now and enjoy later.”

Rewards:
 Income Potential
 Experience

Income Potential:
The potential income for entrepreneur while starting their own business can be very rewarding
and worth all the struggle. They control all their costs to a reasonable extent and the only limit to
growth for them is their own limitations. This is the best part about their own business. It’s
there’s. They can do whatever they want, whenever they want.
Experience:
Being a Founder of your own start up can be very intriguing and prideful. The best part about all
the struggle and hustle is the experience. Experience for an entrepreneur opens many doors for
growth. Experience comes from making mistakes, taking risks and making mistakes.

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Harvard References:
Oberlo. (2019). What it Means to Be An Entrepreneur. [online] Available at:
https://www.oberlo.com/blog/what-is-entrepreneurship [Accessed 18 Mar.
2019].
BusinessDictionary.com. (2019). What is serial entrepreneur? definition and
meaning. [online] Available
at: http://www.businessdictionary.com/definition/serial-entrepreneur.html
[Accessed 18 Mar. 2019].
 What is Intrapreneurship? - Difference, Features and Examples of
Intrapreneurs. [online] Paggu.com.
Available at: https://www.paggu.com/entrepreneurship/what-is-
intrapreneurship-difference-
features-and-examples-of-intrapreneurs/ [Accessed 19 Mar. 2019].

Slideplayer.com. (2019). Entrepreneurship Lecture 2: The Entrepreneurial

Mindset. - ppt download.
[online] Available at: https://slideplayer.com/slide/5860985/ [Accessed 19
Mar. 2019].
https://www.resourcesolutions.com/what-we-
do/workforce-planning.html / [Accessed 20 Mar.2019]

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