P3: interpret and assess relevant data and statics to illustrate how micro and samll business impact on the economy
Micro and small businesses have the great impact on the economy in the UK. These types businesses do change the economic situation in the UK. The numbers of such types of businesses are increasing day by day. Micro and small businesses are a very popular business form because these types of business businesses can easily establish any place. These type businesses follow some rules and regulation. These types of businesses do not have any strict rules.
Fiscal Policy: It refers a government adjusts tax rates and spending levels by monitoring a national economy. Fiscal policy influence macroeconomic condition, employment, economic growth and aggregate demand. It is called the sister of monetary policy (Church, 2014). Fiscal and monetary policies are used in different combination to fulfill a country economic target. This policy is the very effective policy in the UK.
Monetary Policy: It is the macroeconomic policy controlled by the central bank. Monetary policy includes interest rate, management of money. This policy is used by the government of the country to gain macroeconomic goals such as economic growth, liquidity, and consumption. The monetary policy has a very bad effect on the UK economic because this policy has very poor facilities than fiscal policy. This policy does not control interest rate and manage macroeconomic variability in the UK.
On Dec 28, 2017 statistic report show, there were 5.7 million small and medium businesses which were over 99% of all businesses in the UK. The small and micro-entrepreneurship can be any business with less than 250 employees. These types of businesses have great contribution to change economic condition in the UK. SMEs create many job vacancies for unemployed people. So the unemployment rate is decreased day by day in the UK. These types of businesses have the very simple rule and regulation
5.3 Million (96%) business were micro-business
Micro business organization: The micro-businesses are very popular businesses structure in the UK. The formation of micro-businesses is very easy. These type businesses can establish anytime and anywhere. These types of businesses follow small rule and regulation. The micro-businesses need very little investment to build up these types of businesses. These types of businesses consist of only 1-9 employees.. It is the biggest job sources in the UK. On Dec 28, 2017, there were 5.7 (96%) micro-businesses in the UK. These types organization growth rate will be increased 15% in 2019 to 2021.
Micro business accounted for 32% of employment and 19% of turnover
The micro-businesses can operate very easily and its formation is very easy. These types of organization maintain very few rules (Scarborough, 2012). These types of businesses create 32% employment opportunity for unemployment people. On Dec 28, 2017, these types of businesses were £463 turnover that was 19% total turnover of the private organization.
P4: Explain the importance of small business and business start-ups to the growth of the social economy
Small businesses and business start-up are called the backbone of the UK economy. SME has many contributions such as opening the new market, creating a job market and driving growth. There are very important factors in the UK. According to the CBI report, SMEs make up 99% of the private organization and 60% of private organization jobs. There have 4.9 million businesses in the UK. SMEs will do impulse £20 billion into the economy by 2020 according to the Confederation of British Industry (CBI) report. Now, this part is going to discuss the importance of small businesses (Blackford, 2013).
SMEs provide many opportunities for unemployed people. According to House of Commons Library report, SMEs hired 14,424,000 people in the UK last year. On Dec 28, 2017 statistic report show, there were 5.7 million small and medium businesses which were over 99% of all businesses in the UK. SMEs create 16.8 million job vacancies in the UK job market.
Small businesses have the great contribution to employment. According to the official report, Small businesses 2.61 million jobs were created each year between 1998 and 2010 with less than 50 workers. Small businesses were contribution 34% of the total jobs equating to 870,000 jobs. Start-ups were employment less than 10 workers. Start-ups was contributed 33% to the total 870,000 jobs.
On Dec 28, 2017 statistic report show, there were 5.7 million small and medium businesses which were over 99% of all businesses in the UK. So this amount is huge. The competition is increase when the number of private businesses is increasing because everyone wants to make the business profitable (Shepherd & Wiklund, 2015). There are turnover in the market whereby fewer productivity organizations do not sustain in the market and most productivity organizations expand its business when competition is increased in the market.
Small businesses are the great contribution to local economic growth. These businesses help excite economic growth by creating job opportunities for people who are unemployed. Small businesses do attract talents who create the new business idea of products and services or implement the new solution to the existing idea.
Standard of living
Small businesses play the very vital role in stander living because of people income level increase by doing small businesses. Now people are very conscious about their lifestyle and they are spending a lot of money on their stander living.
P5: Determine the characteristic traits and skills of successful enterpreneurs the differentiate them from other business managers
Passion and Motivation: Although there have many traits of a successful entrepreneur passion and motivation is a very important trait for the business success (Bushong, 2011). For example, Joe Woods has more passion and self-motivation for his IT business.
Not Afraid to Take Risks: It is very important factor in the business. A successful entrepreneur is willing to take business risk. For example, Joe Woods is the very braver person. He takes any type of the business risk. He invests a lot of money in his IT business.
Self-belief, Hard Work and Disciplined Dedication: An entrepreneur must keep self-belief, dedicated and confident in his work. A successful entrepreneur is a willingness to do hard work. For example, Joe Woods has believed in himself. He has confident and desiccated to his IT business and he is the very hard worker.
Adaptable and Flexible: Entrepreneurs must be a passionate and dedicated person but inflexibility about clients will lead to business failure. A successful entrepreneur welcomes all suggestion for customization that may increase the client satisfaction. For example, Joe Woods takes all type of business suggestion from his clients.
Product and Market Knowledge: A successful entrepreneur knows his product inside and outside. He also has good knowledge of the market. So a successful entrepreneur tries to create something new that helps him to sustain the market. For example, Joe woods improve services and provide this service number of companies who take payment from the vendor by credit/debit card.
P6: Assess how aspects of the enterpreneurial personality reflect enterpreneurial motivation and mindset
Entrepreneurial characteristics: Joe Woods has strength entrepreneurial personality. He has the high ambition about his IT business. He has self-confident about his work. He takes willingness all type of business risk.
Situational factors: It influencing customers are external factors usually outside the control of retailer, and marketer. Joe Woods is an innovative person. He wants to create new things and apply this thinks in his business.
Family maintenance: Joe Woods gives huge priority to his family. Family maintenance is very important for entrepreneurs because the entrepreneur’s success depends on family support. Joe Woods is a successful entrepreneur because he gets good support from his family.
Culture: Culture is the very important factor to be an entrepreneur because it motivates people to become the entrepreneur. The culture is an influence of entrepreneur motivation and mindset of Joe Woods.
Lifestyle: Now people give huge priority to their lifestyle. They are expense a lot of money for their lifestyle. Joe Woods earn a lot of money from his business. He spends huge money on his lifestyle.
Personal factors: Everyone wants to create own identity in the society, employee’s satisfaction, income security (Wilkens, 2017). These factors have the great contribution to the entrepreneurial and mindset of Joe Woods.
P7: Examine, using relevant examples , how background and experience can hinder or foster enterpreneurship
Lack of education: Education helps to take the right decision at right time and identify needs. If a person becomes illiterate, the person will not be aware of taking the good decision (Miner, 2016).
Low patience: An entrepreneur must believe that any successes do not come overnight. He must have huge confidence in his business success. For example: If Joe Woods does not have confidence in his work, he does not the success of his IT business.
Income insecurity: Entrepreneurs face a higher risk when they launch new products on the market. If they think that they earn huge income very early stage, it will be the wrong thing to them. For example: At first, Joe Woods did not have any income from his IT business.
Background and experience can foster enterpreneuship
Personal background: Personal background involves many elements such as family background, ages, work experience, education etc. These elements are very important to be a successful entrepreneur. For example, the personal background of Joe Woods is very good. The personal background helps to become a successful entrepreneur
Entrepreneurial traits: Entrepreneurial traits refer to internal locus control, innovative, self-confidence, innovative inspire a person in the entrepreneurship business. For example, Joe Woods is the very creative person. He has self-confidence about his decision. So he would overcome all business problems.
Family support: Family support is the very important factor to become a successful entrepreneur. For example, Joe Woods has a big strength behind his business success; he gets big support from his family members.
Education: It is the very important factor because educated people take the right decision at the right time (Hoffman, 2011). For example, Joe Woods is the very educated person. He completed his graduated degree from a local university 9 years ago.
Entrepreneurship creates many job vacancies for the unemployed persons. It has great contribution to change country economic condition. Entrepreneurship also has the great achievement to the sustainable growth of any economy (Webb & Adler, 2013). Entrepreneur can easily launch the new business with his innovative idea and achieve business success. Entrepreneurs must have passion because success does not come overnight. Entrepreneurs must have a good personality, knowledge, and characteristics that help him to be innovative and creative.
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