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The impact of organizational and
entrepreneurial level individual factors
as determinants in the growth of small
businesses in the UK
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The impact of organizational and entrepreneurial level individual factors as determinants in
the growth of small businesses in the UK
Table of Contents
Chapter 1: Introduction..............................................................................................................4
1.1 Research outline...............................................................................................................5
1.2 Research problem.............................................................................................................5
1.3 Research background.......................................................................................................6
1.4 Research rationale............................................................................................................7
1.5 Research limitation...........................................................................................................8
1.6 Future scope.....................................................................................................................9
1.7 Research aim and objectives............................................................................................9
Chapter 2: Literature review 4500...........................................................................................11
2.1 Introduction....................................................................................................................11
2.2 The concept of Entrepreneurship and small business growth........................................11
2.3 The measurement of the business growth......................................................................13
2.4 Determinants of small business growth.........................................................................15
2.5 Risks associated with the small business.......................................................................15
2.6 Theories of small business growth.................................................................................15
2.6.1 Integrated model theory affected on small business growth...................................15
2.6.3 Stage model and life cycle theory on small business growth..................................16
2.7 Modes of small business growth....................................................................................18
2.7.1 Organic Growth vs Acquisitions.............................................................................18
3.5.2 Growth through Networks and Alliances................................................................19
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3.5.3 Growth through Internationalisation.......................................................................20
2.8 Summary 100.................................................................................................................21
Reference:................................................................................................................................24
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Chapter 1: Introduction
Small business plays a vital role in contributing their products as well as employment.
However, their success or achievement is still low. In that fact, the success of small and
medium enterprises (SMEs) is penetrating the export potential and export markets becomes
low compared to the existing SMEs (Song et al., 2018). Therefore, it is needed to determine
their factors in developing their business potential and efficiency. The factors of operating a
small business mean tax areas, management control, supply chain management, brand
reputation, marketing, leadership, HR management, business strategy and many more
(Weijiang, and Zhuo, 2018, p.1). At the same time, this study is expected to follow the rules
and regulations of the government in order to improve their business as well.
On the other hand, the performance of the small business organisation is categorized into two
parts that are concerned with the organisational as well as personal aspects. The study of
personal aspects consists of individual characteristics, core competencies and demographic
segments, while the aspects of organisational include several resources of a business,
organisational structure, culture and company competence and so on (Koryak et al, 2015,
pp.89-105). Apart from that, in case of a small business organisation, the growth
determinants can be separated into several factors and these are environmental, individual
and organisational, core competency in the entrepreneurial methods, the characteristics of the
managers or owners, innovative strategies and technologies(Sarwoko, and Frisdiantara, 2016,
pp.36-41). As per these factors, the SMEs' performance can be determined by the
characteristics of the managers and leaders along with entrepreneurial competence. The
strategic decisions and implementation can be determined by the entrepreneurial competence
which will affect the performance of the SMEs(Rezaee, 2016, pp.48-64). Thus, these factors
are significant and vital for small businesses for their growth. Due to environmental situations
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like change in marketing dynamics, competitive situations and so on, the environment within
the workplace is an important factor in boosting their business and develops their efficiency
in a proper way. Therefore, the determinants of growth of SMEs are needed to be examined
effectively.
1.1 Research outline
To conduct this research, the researcher takes the suitable and best methodologies as well as
sets some business goals and objectives which helps in getting a proper and effective
outcome. Along with that, the literature review section has been highlighted several
discussion about the research topic which support this research project. The researcher
identifies the primary and secondary data collection method to gather both primary secondary
data and information regarding the research topic. Besides that, the mixed methodology is
adopted by the researcher for a better outcome.
Moreover, the researcher also organises an interview and survey method for accumulating the
primary data. At the same time, the thematic analysis is conducted to comprise the discussion
between the interview section and the finding section. The final outcome can be determined.
After the determination of the finding and thematic analysis, a proper discussion, as well as
recommendations, are also demonstrated in this research work for a better outcome. The
researcher makes the total project systematically by which the possible outcomes will be
gained. This helps for further researches to make their project easily and handle any type of
risk.
1.2 Research problem
The small business enterprises have confronted several issues and challenges constantly
while operating their business. These problems hamper their business activities and
operations. Sometimes, the SMEs face some funding issues and finance related problems
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while operating their marketing and sales applications due to their expenses(Slawinski, and
Bansal, 2015, pp.531-549). At the same time, the small organisations also face supply chain
issues which are a huge barrier for them to maintain their operational activities in a proper
way. Moreover, they cannot make proper strategic decisions and therefore, they face a huge
problem. Due to these issues affecting their business, it is vital to deal with such issues and
tackle them in a systematic way.
Furthermore, they have to determine various factors which are needed to be improved. To do
so, the small enterprises have to provide the assurance of sustainability of their resources,
financial services management and ensure to upgrade and develop their several operational
areas(Hoogendoorn, 2016, pp.278-296). Therefore, it is important for business managers and
owners to operate all the activities and operations in an effective way. In this project, the
researcher highlights several key areas and the mitigations of those areas. Apart from that, the
researcher also focuses on the influences of those key areas on the development of their
business.
1.3 Research background
As per the huge majority of studies, the reasons for a firm development in the UK have been
seen. Some evidence as per the impacts on the development of new firms for growing
countries can be still scarce. Moreover, a few numbers of works have focused on several
factors of the organisation. However, the firm growth’s determinants might change among
several countries. Therefore, it is important to examine them by utilising similar
methodologies, frameworks, and measures.
From several studies on entrepreneurship, the concept that presents a mixture of public,
private, formal and informal, profit and non-profit activities is defined. In the region, the most
common trend is that new SMEs play a significant role in the UK economies (Amorós et al.,
2016, pp.283-307). In that perspective, small businesses cannot be marginal sectors in the
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country, but they have a big profile especially in employment. In the 1970s, the establishment
of net employment was covered among the public sector, SMEs, agriculture, micro
organisations, and large-scale private sectors. At that time, while the region has been
growing, the labor market had left to the SMEs and the enterprises.
The main purpose of this research is to determine several factors affecting new firm
development in the UK. In that case, the data and information had been selected in 2000 and
2001 by conducting face to face interviews among the new business enterprises(Huggins et
al., 2017, pp.357-389). Therefore, organisational, individual and environmental variables or
factors are needed to be involved to explain a detailed discussion of their growth. Along with
that, various characteristics of regression approaches as well as employment growth variables
are also used. In order to grow these factors for the betterment of their business, SMEs need
to utilise several strategies and technologies which help in taking any strategic decisions and
act in a proper way(Nyoni, and Bonga, 2018, pp.01-18). Thus, they can operate their
activities correctly and grow their competitive advantages as well.
1.4 Research rationale
There are several determinant factors in an SME that can affect the business positively and
negatively equally. Many factors like area, brand values, sustainability, the supply chain of
social enterprises, leadership and the marketing and brand values can make an impact in the
business. To solve all the problems, the business has to ensure some criteria that can give
strength to the companies. The smaller business has to ensure the sustainability of the
product, employment and service management.
The company faces some issues like management and account problem and they have to
recognise these problems. It is very important to find out the direct and indirect impact of
these factors on the overall growth level of a business. If the entire problem can overcome,
then the company can easily get the core competencies normally. As a result, if it is overcome
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then it increases the growth level of the company. It gives strength to the company to
compete with its rival companies in the market area. To recognise these problems and to
know the particular area which should be developed, this research is needed. This research
will help the SMEs to focus on particular organisational and entrepreneurial factors.
1.5 Research limitation
In conducting the research, the researcher will face many problems that become hazards to
complete the research. The researcher will face some serious issues during the interview
process. The participants sometimes may not be helpful in the whole process. The
interviewee may be asked some confidential queries about the company therefore on that
time, they will not cooperate with the interviewer. Sometime the participants will not provide
the right information. The participants may be afraid to give such personal details about the
company therefore they will not provide the right information therefore they will not agree to
help the interviewer. It makes some negative effects in the meantime of the data analysis.
That can cause a massive problem to collect the company's right information.
During complete the research, there may be less information or different themes that can be
found on the internet. So, it causes also some major issues to complete the research. Less
information can cause a little problem for the researcher. There may be some incorrect
information in the timing of data analysis. This can cause wrong information in the whole
research work. There may happen some biasness in the meantime of the interview process.
That can cause some issues in research work. Come Time constraint becomes a barrier in this
researcher. There are several factors associated with this research and thus it is needed to
properly analyse. To complete the research it will need more time. To complete the survey
the researcher needs more time to complete the whole process. Therefore, the limitation
should be mitigated by proper focusing on these negative factors.
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1.6 Future scope
Future scope discusses bout the significance of this research in the future and its application
in the future. This research is based on a small and medium company. In this research, many
issues are faced during the data collection and data analysis which are given in this research.
It will help future researchers to concern about these issues and conduct the research in a
systematic way. There are also several issues faced by the SMEs for these organisational and
entrepreneurial factors. If these issues may overcome then the company's growth level
increases fluently even it is a small company. The researcher gives detailed information in
every part where it needed. Many effecting factors that can cause problems like financial,
managing issues, supply problems, employee problems. All these problems and their
solutions are provided in this research project. It can help companies like SMEs to overcome
such type of issues if happened in the future. The researcher can use this research for a
secondary research article. Here researcher can provide a brief account on the in every part
that can help a brief description of the work. From this research, the researcher will get to
know the approximate time taken to complete the whole research. Apart from that, the
companies can determine their lack of areas from the decisions made by this researcher. They
can maintain a continuous growth level by mitigating the issues. Therefore, this research will
be more significant in the future for both future researchers and SMEs of the UK.
1.7 Research aim and objectives
Before completing the research, the researcher has to set the aim and objectives of this
project. That will help the researcher to complete the whole research more efficiently.
After determining the aim, the researcher can get a clear idea which part is more important
and which part is less important. Thus the researcher can focus more deeply on the important
part. Therefore to start the research, it is more vital to do thorough research and set the best-
suited aim according to the research topic and research theme.
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Research aim:
The research aims to determine the effect of the company and individual factors that can
determine the growth level of small businesses in the UK.
Objectives:
The researcher at first has to set some objectives as per the aim. It will help the researcher to
find out the actual results which can help the researcher to take important decisions from
several factors. These objectives will be helpful for the researcher to recognise the research
questions as well as collect information about the topic. However, the research objectives are
given below :
1. To study the company level factors for further improvement of these factors.
2. To focus on the individual level factor that can help to prevent the improvement or failure
of the business.
3. To determine the main key recommendation that can help to follow the small business
towards great success and helps to maintain it.
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Chapter 2: Literature review
2.1 Introduction
The expansion of a small business is necessary as rapid growth contributes to the innovation,
job creation and boosts their economic growth. If a small enterprise expands in size, they
have to spend more money on poverty decrement and economic development. However,
there is a question of how small enterprises accomplish growth. In that aspect, it has been told
that all businesses cannot grow and those who grow, they gain organic growth than the larger
businesses. According to the expanding level of obedience to expansion in established
countries, firm growth has been a massive problem in entrepreneurship. Therefore, this study
has focused on knowing several kinds of determinants or factors to drive their business
growth. A critical view of previous articles is that the environment, individual and firm
predict business growth. This section, therefore, reviews the literature on business expansion.
This chapter shows a clear vision of the definition of entrepreneurship and small business
expansion, estimating the business expansion as well as appropriate theories driving the
business growth. Along with that, several determinants of business growth, risks associated
with the business and several modes of business expansion are also elaborated in this chapter.
Lastly, a summary of the whole section is also attached here.
2.2 The concept of Entrepreneurship and small business growth
According to the research of Zacca, Dayan and Ahrens (2015, pp.2-23), entrepreneurship
means the creation of new enterprises, the determination of new opportunities and
exploration of new ventures. Several entrepreneurs have various external skills. In that
perspective, they should be creative, innovative and capability to take any risk. At the same
time, Huggins and Thompson (2015, pp.103-128) stated that entrepreneurs need to be more
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creative and they must utilise advanced models and techniques for running the business.
However, Jones, Borgman and Ulusoy (2015, pp.611-632) asserted that the entrepreneurs are
those who explore the business environment, opportunities and utilise then after the proper
execution. Along with that, several scholars comprise the entrepreneurs with small business
owners. In that case, both factors can be used in an interchangeable way, but these have so
many differences in their responsibilities under a situation (Scuotto et al. 2017, pp.640-655).
From the above-mentioned studies, it has been understood that the prime focus of an
entrepreneur is innovation to gain more profit for their success.
Whether enterprises have been growing, the business becomes successful. As growth comes
with several connotations, it means value addition, revenue generation as well as expansion
as per the size of the business. Moreover, growth can also be estimated in terms of different
qualitative features such as products' quality, market position and demand of the consumers
(Dikova and Brouthers 2016, pp.489-530). Therefore, growth is a significant indicator of
flourishing a company. There are several vital factors such as attributes of the entrepreneurs,
resources including finance along with manpower that influence the improvement of the
small business and comprise it with a non-improving business. As per the work by Osinde,
Arasa and Kinyili (2019), it is seen that the growth can be a vital function in making any vital
decisions made by the entrepreneurs. This study also highlights the way of developing
externally and internally and identifies the best place to explore their business in the global
and local markets. Besides that, several theoretical models are there to determine the
important factors to boost their business. With the help of those theories, the small businesses
can able to deal with the impact of different variables like company, strategy and attributes of
the owners of a business which affect the age and size of the enterprises on their expansion
(Del Giudice et al. 2017, pp.652-673). In addition, a business’s growth depends on other
characteristics like productivity and financial structure. The total assets of the small business
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also directly influence their sales and revenue value, where the investment in R&D, amount
of workers and other elusive assets have not a huge impact on the growth aspects of the small
business (Herstad, Sandven and Ebersberger 2015, pp.138-153).
2.3 The measurement of the business growth
The business growth is needed to be a measure which generates diverse views for a business.
In the literature of Baum, Schwens and Kabst (2015, pp.754-768), several measurements of
the business expansion has been employed. These measurements provide specific benefits
and challenges in the view of prospects of growth. However, there can be a controversy in
literature by which the business growth has been measured.
Several factors associated with the business growth

measurment
Worker's performance
Asssets
Productivity
Revenue
Sales growth
Employment
0 5 10 15 20 25
(Figure: Several factors associated with the business growth measurement)
(Sources: Rodríguez and Nieto 2016, pp.1734-1753)
From the work of Kuratko, Morris and Schindehutte (2015, pp.1-13), the business expansion
can be calculated as per several changes in the employment, profit margins, sales rate,
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revenue and productivity. In that perspective, there is a growing symphony of the usefulness
of the sales because of the measuring of growth for a 5 Years’ time span (Khedhaouria,
Gurău and Torrès 2015, pp.485-504). On the other hand, he asserted that a huge outcome is
that the sales lead the other indicators. From this view of the study, it has been understood
that the business growth means the increment of sales which drive the enhancement of the
assets and increase in workers of a small business (Hillary, 2017). This helps in gaining a
huge amount of profit margin and reaches a stable position in the market.
Julien (2018) proposed that the sales rate is measured easily over several sectors and
countries. With the help of measurement, business growth can be calculated with ease. He
utilised the growth of relative employment for the time span of three years. As per this study,
it is concluded that employment plays a vital role in business growth which is helpful for
policymakers as they are mostly concerned about employment rather than the sales
development within the economy. Though an outsourcing strategy is employed by some
small businesses, the employment growth cannot be always linked with the sales rate (Burns,
2016).
Apart from that, this study mainly focused on employment and sales growth due to some
reasons. The main reason is that the measures of employment and sales have implemented
highly in the explorative growth studies (Keasey, Pindado and Rodrigues 2015, pp.862-881).
Moreover, another measurement of growth provides several deficiencies that create their
aptness difficult. For instance, the application of the whole asset can be linked with the
capital power of the sector.
Hayes, Chawla and Kathawala (2015, pp.395-406) said that it has been seen that several
growths calculate and this estimation of the small business growth have favourable impacts
on model building as well as theory improvement. These measurements also support using a
single measurement of business growth. The multiple measures are helpful in taking into
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consideration several models testing as well as theory improvement. From that point of view,
it is known that the growth of business should be measured as this enhances their
performance as well as profits. This is possible by identifying some statistics like workers,
turnover, sales, and market share (Fitzgerald and Muske 2016, pp.412-430). The business
growth assures the long-term survival of the business.
2.4 Determinants of small business growth
The research of several scholars classified several internal and external factors which makes
an impact on the growth of small businesses. These can be organisational factor or
entrepreneurial factors. According to Brenner and Schimke (2015, pp.539-557), the
determinants can be categorised in three ways which are characteristics of the firm, firm's
strategy and the entrepreneur. He further stated that this differentiation is made on the basis
of the available resources of the entrepreneur, business strategies and business characteristics.
This study mainly recognised all the components of the key variables. Apart from that, this
study also stated the significance of these components to the rapid growth of the businesses.
On the other hand, the research of Dvouletý (2017, pp.12-33) assessed that every factor
provides a unique offering to the business. For a start-up, the entrepreneur is the main and
plays a vital role in the growth of such businesses. The decision of the entrepreneurs and his
implemented strategies reflect on the growth of these start-ups. Therefore, an accurate
prediction will be fruitful to the entrepreneur. However, this study has some negative points.
The mechanistic approach is not able to discuss the topic so much and its contribution is little
towards the chemistry between these factors for the growth of the small businesses. By the
way, this study is helpful to recognise several determinants which make an impact on the
several business functions of a small-sized company.
Storey (2016) first developed and determined the determinants for a small business.
According to him, the internal and external factors influence the decision of the entrepreneur
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and thus it makes an impact on the growth of the small business. The determinants of Storey
are illustrated in the table form below:
(Figure: Determinants of small business growth)
(Source: Storey et al., 2016)
However, an issue will be occurred to identify whether the external factors matter or the
internal factors like the decision of owners matter most in the growth of the small business.
By the way, the components of Storey's are derived empirically and individually which has a
continuous effect on the growth. However, this study did not state a particular combination of
the factors which are needed to sustain the growth of the small size company.
According to Sarwoko and Frisdiantara (2016, pp.36-41), growth is an issue of skill and
willingness to some extent, but constraints and the enablers of the external environment
cannot be ignored as it has a great influence on the business growth. However, this study
recognised many different determinants than Storey's components. Based on this study, the
determinants are characteristics and behaviour of the entrepreneur, management strategies,
business characteristics and environmental factors. However, these determinants are not
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completely new as some of them are referred to in several previous studies. By the way, the
main conclusion which can be determined from all the previous scholarly articles is the
business growth which can be formed because of several internal and external factors.
Peric and Vitezic (2016, pp.1-12) assessed that the external factors like population ecology
determine that small businesses are mainly impacted by the determinants which are located in
the outside of the borders of business and can be found in between markets and industries.
This research states that rapid growth can be seen in the business in regions and dynamic
industries. This study can be utilised as evidence that business growth can be externally
determined.
On the other hand, the entrepreneurship literature of Eijdenberg, Paas and Masurel (2015,
pp.212-240), it is seen that there are several factors regarding the internal infrastructure and
entrepreneurs' decisions. This study assessed that communicated vision, growth motivation,
willing to growth, owner's decisions and growth aspirations facilitate the growth of the small
business. Mainly a business's characteristics should be related to the key decisions taken by
owners by which the company can make their direction towards further growth. From this
study, it can be said that internal factors influence business growth to some extent. However,
this study doesn't focus on the external factors which are also some crucial determinants of
the company's growth. Therefore, it is a lack of this research study.
On the contrary, from the research study of Khedhaouria, Gurău and Torrès (2015, pp.485-
504), it can be seen some factors like legal status, firm size and age, location of the firm and
sector affiliation is the factor which can influence the growth of the company. However,
factors like firm size and age have been recognised as the determinants of business growth in
several past research studies.
These factors were first identified as the determinant in Gibrat's law. According to this law,
the growth of a company is independent of the firm's size. Therefore, according to the law, a
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business's growth in a specific time frame will remain the same. This is applicable for any
business with a specific industry. By the way, the impact of the firm's age in small business
growth is mixed.
This study recognised many new organisational and entrepreneurial factors which have a
great influence on business growth. By the way, in the practical field, often Gibrat's law is
applicable as the business will face some hazards in the meantime of sustaining their
business. Therefore, they have to change their strategies according to the influence of these
factors. Otherwise, the company will face down risks and threats. Therefore, due to some
factors, the company may not be developed in the same way. Therefore, it is said that
business growth is not a constant process. But, to make it constantly, the company should
focus on these factors by which they will gain some core competencies and enrich the growth
of the businesses (Barber, Metcalfe and Porteous, 2016).
2.5 Risks associated with the small business
There are several risks associated with small businesses. Especially, in the case of start-ups,
there is a huge risk to confront a loss and even close down of the business. Therefore, these
risks should be recognised by the small business and it will be helpful in their continuous
growth.
2.6 Theories of small business growth
The study of Suleiman (2016), it is indicated that most of the small business does not grow
properly. This study explains the factors that influence small businesses. The existing
literature provides various theories that predict that small business does not grow properly it.
The scholar predicts that the growth of small businesses is crude and contradictory. Similarly,
a scholarly article of (Fortier, M 2016), indicates that small business growth can be affected
by many factors. Moreover, it is difficult to explain the growth of small businesses with a
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single size model. Integrated model theory where explain the factors that influence the
business growth and another one is stage model theory shows the growth rate of business in a
series of different stages of improvement are the two main theories in business growth. This
study highlights to examine the factors externally internally properly to understand the small
business growth.
2.6.1 Integrated model theory affected on small business growth
Many theories highlight to explain this model that leads to the growth of a small business.
From such theories assessment of advanced economies and less developed market economies,
both parts have received. Both economics highlights the external and internal factors which
are equally needed to examine the growth of the small business. However, many theories are
involved to examine the business growth therefore, much confusion arises. Some integrated
model theories are Penrose’s resource-based perspective, Storey’s growth determinants
model, Jovanovic’s learning theory, Wiklund’s growth model, Davidsson’s growth
determinants model. As a result, it is difficult to understand which is more appropriate for the
growth of the small business (Bugajska, B.E., 2017, pp.1095-1110). A little concern arises
among the scholars that the integrated theory has a positive and negative effect on small
business growth. It is difficult to describe by this theory why some small business grows but
some business fails. This may happen for the issues regarding management control, bonus
schemes including misuse them, public sector management accounting issues. These may be
the reason for the failure of some small business growth. Therefore the integrated factors help
to examine small business growth.
2.6.3 Stage model and life cycle theory on small business growth
It is most important to explain the growth process apart from highlighting the factors that
influence small businesses. This model helps to understand the details process included
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among every stage. This theory presented the life cycle of stage models that encloses the
entire life span of a business. According to (Savage, Tokunaga, 2017pp.353-361),this the
theory states that life cycle models are mainly referred to the organisations. These theories
mainly state the issues of economics, sociology, and management as all businesses do not
pass through this cycle. These models help to attempt to highlight the progressive nature of
the growth of a business (Booth, Sutton, Papaioannou 2016). The difference between life
cycle and stage model theory is life cycle model points out the growth, important, maturity
and decline on the other hand stage model theory highlights the problems faced by the small
business.
Figure: Business life cycle
Source: (Goss, 2015)
Stage model mainly explains the process of business development and the problems that are
facing go through the business. The stage model theory shows the problems faced by each
stage and they are varying in each stage. It is difficult to overcome such obstacles and
therefore the entrepreneurs should mediate the factors and need to make some strategy that
helps for the growth of small business. Life cycle model also provides the nature of the
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evolution of business and potential obstacles faced by small businesses (Storey, 2016). The
external problems insist in the early stages of the life cycle of the organizations therefore the
internal problems are seen in the later stages of the organization. However certain problems
tend to persist in many stages and scholarly studies have made no steps for understanding
why the problems exist. From this theory, the stage model highlights the point on what a
small business can do but it fails to describe the environmental impact on business activity
and performance. According to the scholars states that stage theory only shows the symptoms
of growth and does not highlight the underlying causes of growth. Thus, these two theories
influence to overcome the obstacles and help to improve the growth of the small business.
2.7 Modes of small business growth
In order to handle any critical situation of a small business, the best approach is to identify
appropriate modes of business growth. As per Puente et al. (2017, pp.699-726), it is seen that
businesses grow in several ways like external growth and internal organic growth. This study
also highlights that the entrepreneurs aggressively focus on embarking on several kinds of
growth on the basis of their huge motivations. Therefore, it is understood that they are willing
to gain high growth. Below, detailed information about different modes of business growth is
discussed.
2.7.1 Organic Growth vs Acquisitions
Acquisitions strategy for growth is the most effective strategy by which a small business
purchases other businesses or firms. In that fact, Alasadi and Al Sabbagh (2015, p.293)
discusses the presence of diverse routes to growth, markedly growth versus organic growth
by acquisitions. This study shows that organic growth is limited by considering three factors
which are external factors, internal factors and combination of external and internal factors.
As per the strategy linked factors, he told that the organic growth is dependent on the growth
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opportunities and managerial capabilities and specialized resources for making a plan and
locate those resources effectively, but this growth cannot appear automatically. Form this
study, it is concluded that a small business which tries to expand organically, can engage in
providing proper technological training session. This helps in boosting their operational
activities. Thus, the skills gained by the workers from the training provide some extra value
to their operational growth that can allow their business in order to explore its market share.
In case if their business cannot be growing, this knowledge and experience will become
untapped.
Löfsten (2016, pp.88-106) discusses several explanations of the cause of gaining the
competitors for their growth. While starting a new business in the new market, the technical
and managerial difficulties and costs can be possible to decrease by obtaining another
business. In that way, small businesses can able to tackle market difficulties with the help of
the acquisition strategy. This study also illustrates that existing firms are not only enough to
grow their business successfully, but this can affect their way of external growth. On the
other hand, the intention of acquisitions consists of several elements such as diversification,
market access, sustainable competitive positioning value, expansion responding to the change
in the sector and acquisition of information of other firms and businesses. The acquisition
strategy also helps in securing the market share and achieves their strategic goals firstly.
Thus, these moves are helpful for the small business to resolve the obstacles come with the
competitive market. Along with that, some scholars have asserted a powerful bonding
between business growth and acquisitions. However, some have reported a negative
relationship between these two terms. From this point of view, it has been known that
sometimes acquisitions may hinder the substantial advantages as this strategy focus on
providing faster growth rather than internal development. Apart from that, the acquisitions
strategy enables the small business to obtain both intangible and tangible assets and as a
Page 22 of 31

result, the conclusion of the acquisitions develop their flexibility, increase the leverage
competencies, deliver resources as well as make new opportunities (Li et al. 2016, pp.97-
125). This can support in mitigating the managerial constraints which increase the business
growth.
3.5.2 Growth through Networks and Alliances
According to the study by Omri, Frikha and Bouraoui (2015, pp.1073-1093), several
categories of networks have been seen. At the same time, these typologies of networks can
lead to grow their business effectively. In the context of economic sociology, the impact of
network fixing on business expansion has also been developed. Moreover, it is also built that
entrepreneurs should obtain knowledge via external networks. The platform for making a
selective learning process is provided by the networks and this learning procedure helps to
bring several innovative ideas for business growth. According to this study, it has been
understood that the alliances, networks and joint ventures are the most crucial strategy for
high firm growth. Thus, the network, as well as alliances, play a significant role in increasing
small business growth.
3.5.3 Growth through Internationalisation
Growth through internationalisation depicts a strategy in strategy and management. The
prime reason for choosing this mode is to prevent the local market obstacles, difficulties and
inefficiencies within the domestic business environment. The growth of small businesses is
considered as the act of entrepreneurial. Koryak et al. (2015, pp.89-105) proposed the
internationalization strategy of a business. For instance, it has been understood that the best
path to determine the internationalization can be an outcome of the resources which the
organisation help. The way to internationalisation consists of incremental stages along with
exporting which acts as a prime path to internationalization. Along with that, the
Page 23 of 31

internationalization strategy can also be termed as a term of business growth and growth
strategy as this includes market and cross-border related activities. As a result, this enhances
the quality of products and develops the performance. Furthermore, it can also be developed
that the internationalization strategy also included foreign direct investment (FDI), exporting
and alliances. More involvement in exporting can enable small businesses to execute huge
resources to the foreign markets. Notwithstanding, internationalisation strategy needs small
businesses to engage a huge amount of resources in it. In that case, the execution of resources
is difficult to find for a small business due to a lack of resources.
From the above-mentioned modes of business growth, discussion, it has been concluded that
acquisition strategy is beneficial for expanding the small business in the local and
international markets. By utilising this strategy, the small business becomes able to develop
its activities and make more opportunities. At the same time, internationalization is the most
complex strategy which does not provide huge benefits for a small business.
2.8 Summary 100
Page 24 of 31
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The impact of organizational and

entrepreneurial level individual factors

as determinants in the growth of small

the growth of small businesses in the UK

1.1 Research outline...............................................................................................................5

1.2 Research problem.............................................................................................................5

1.3 Research background.......................................................................................................6

1.5 Research limitation...........................................................................................................8

1.6 Future scope.....................................................................................................................9

1.7 Research aim and objectives............................................................................................9

Chapter 2: Literature review 4500...........................................................................................11

2.2 The concept of Entrepreneurship and small business growth........................................11

2.3 The measurement of the business growth......................................................................13

2.4 Determinants of small business growth.........................................................................15

2.5 Risks associated with the small business.......................................................................15

2.6 Theories of small business growth.................................................................................15

2.6.1 Integrated model theory affected on small business growth...................................15

2.7 Modes of small business growth....................................................................................18

2.7.1 Organic Growth vs Acquisitions.............................................................................18

3.5.2 Growth through Networks and Alliances................................................................19

the growth of small businesses in the UK

2.8 Summary 100.................................................................................................................21

the growth of small businesses in the UK

reputation, marketing, leadership, HR management, business strategy and many more

and regulations of the government in order to improve their business as well.

personal aspects consists of individual characteristics, core competencies and demographic

segments, while the aspects of organisational include several resources of a business,

managers or owners, innovative strategies and technologies(Sarwoko, and Frisdiantara, 2016,

strategic decisions and implementation can be determined by the entrepreneurial competence

the growth of small businesses in the UK

1.1 Research outline

adopted by the researcher for a better outcome.

1.2 Research problem

the growth of small businesses in the UK

tackle them in a systematic way.

areas(Hoogendoorn, 2016, pp.278-296). Therefore, it is important for business managers and

1.3 Research background

several countries. Therefore, it is important to examine them by utilising similar

methodologies, frameworks, and measures.

the growth of small businesses in the UK

al., 2017, pp.357-389). Therefore, organisational, individual and environmental variables or

that, various characteristics of regression approaches as well as employment growth variables

activities correctly and grow their competitive advantages as well.

product, employment and service management.

the growth of small businesses in the UK

1.5 Research limitation

should be mitigated by proper focusing on these negative factors.

the growth of small businesses in the UK

1.7 Research aim and objectives

suited aim according to the research topic and research theme.

the growth of small businesses in the UK

determine the growth level of small businesses in the UK.

towards great success and helps to maintain it.

the growth of small businesses in the UK

Chapter 2: Literature review

businesses. According to the expanding level of obedience to expansion in established

Lastly, a summary of the whole section is also attached here.

2.2 The concept of Entrepreneurship and small business growth

the growth of small businesses in the UK

entrepreneur is innovation to gain more profit for their success.

(Dikova and Brouthers 2016, pp.489-530). Therefore, growth is a significant indicator of

the growth of small businesses in the UK