1.3 Enterprise, Business Growth and Size

2026 Syllabus Objectives

By the end of this topic, you should be able to:

1.3.1 Enterprise and Entrepreneurship

  • Describe the characteristics of successful entrepreneurs
  • Explain the contents of a business plan and how it helps entrepreneurs
  • Explain why and how governments support business start-ups

1.3.2 Measuring Business Size

  • Describe the methods used to measure business size
  • Explain the limitations of each method

1.3.3 Why Some Businesses Grow and Others Remain Small

  • Explain why owners may want to expand their business
  • Describe different ways businesses can grow (internal and external)
  • Explain problems linked to business growth and how to overcome them
  • Explain why some businesses remain small

1.3.4 Why Some Businesses Fail

  • Identify causes of business failure
  • Explain why new businesses are at greater risk of failing

1.3.1 Enterprise and Entrepreneurship

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What Is an Entrepreneur?

An entrepreneur is a person who comes up with a business idea, organises the resources needed to run it, and takes on the risk — meaning they could lose their own money if the business fails. Entrepreneurs are also often innovators, meaning they create new products or find better ways of doing things.

Famous examples include Mark Zuckerberg (Facebook) and Elon Musk (Tesla and SpaceX).

Characteristics of Successful Entrepreneurs

Entrepreneurs need both personal characteristics (personality traits) and skills (things they can do well) to succeed.

Characteristic / SkillWhat It Means
CreativityComing up with new ideas for products or services that stand out from competitors
Hard-workingPutting in long hours, especially at the start when there is little support
ResilienceBouncing back from setbacks — mistakes and failures are common, and an entrepreneur must keep trying
InitiativeBeing able to make important decisions on your own without waiting to be told
Self-confidenceBelieving in yourself and your idea — this helps you convince banks, investors, and customers to trust you
Risk takerBeing willing to invest money and time even when success is not guaranteed
CommunicationTalking and writing clearly and persuasively to banks, customers, and staff
Problem-solvingFinding solutions when things go wrong
OrganisationPlanning and managing time, money, and people effectively

Exam tip: Don't just list these traits — always explain why they matter. For example: "Risk-taking is important because it allows the entrepreneur to launch new products even when success is uncertain."

Advantages and Disadvantages of Being an Entrepreneur

Advantages:

  • Freedom to make your own decisions about time and money
  • Can turn personal interests and skills into a career
  • Potential to earn more than as an employee if the business succeeds
  • Personal satisfaction from building something yourself

Disadvantages:

  • High risk — many new businesses fail, especially without careful planning
  • Must invest personal money (capital), which could be lost
  • Opportunity cost — by starting a business, you give up the salary you could have earned working for someone else
  • Can be very stressful; long hours, no guaranteed holidays or sick pay

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