The Type of Small Business Opportunities - Assignment Example

Small Business Enterprises The type of small business opportunities that can be capitalized in UAE The United Arabs Emirates (UAE) is described as a capital hub as it commercial city, Dubai, offers an easy access to approximately 1.5 billion consumer markets in West Asia, Africa, Eastern Europe, CIS countries as well the nearby Middle East nations. Qatar and Dubai are some of UAE countries people are trooping to because of the many job opportunities and favorable economy there. For instance, Dubai is one of the uppermost destinations for investors and business people in the entire Middle East. The government policies and the nature of the current infrastructure facilitate the growth of small business as well as big companies. Business opportunities in UAE are not just for people within Middle East, but also to overseas investors. Foreign investors in Middle East nations are encouraged since their foreign business is a great boost to the economy. There are numerous free trade areas, particularly in Dubai, and that is the reason why trade and commerce is at peak in those countries. People come from many countries to shop in UAE because they get cheap and quality goods there. Additionally, introducing a business in the UAE is very straightforward and easy. UAE encourages investors to invest in the oil and gas –rich country. Another reasons why investors are attracted in investing in UAE is because the taxation mostly non-existence or minimal. The Middle East governments have a long- run strategy that concentrate heavily on the growth of upcoming businesses. They have business policies that are truly favorable to all investors. The tax-free atmosphere is encouraging for new and emerging enterprises (Spraggon, 2014). This paper will discuss a type of small business opportunity that can be capitalized in United Arabs Emirates. Additionally, the paper will discuss the business significance and its benefits to the society. This paper also discusses how the small business can help the economy and business sectors at large. Because of the many large-scale businesses in UAE, there is a huge demand for experts who offer financial services like bookkeeping, accounting, and auditing. Persons with solid backgrounds in any of these financial fields will make a lot of profit by opening a business that will provide financial services to other businesses in UAE. The UAE financing sector is adequately resourced to cope up with domestic and global stress situations and has dealt with the current global financial chaos comparatively well. Looking at future, a report indicated that UAE finance sector would continue to indicate a high level of flexibility because of its conservative, sound financial indicators, a restricted real estate exposure and low dependence on foreign funding. The finance sector in UAE provides financial services to corporate, private and institutional clients. Financial sectors provide affluent individuals and high net worth around the globe a complete range of customized investment and advice services. Islamic finance is one of the most competitive sectors in UAE as it holds approximately seven percent of the worldwide Islamic banking assets and has a holds a market share of about twenty-five percent locally. The tactful sector has grown gradually since 2009 and this trend is more likely to continue in the future. UAE is growing as a financial place that attracts expertise and investment from all corners of the world. The financial services sector plays a vital role in sustaining UAE businesses and allowing the UAE’s economy to grow. The products and services it gives are an important part of the UAE economy. The significance of financial services in a current economy means it is fundamental that financial improvements help to build a competitive and flexible financial system that is tax-free. Discuss its importance and how it helps society at large A finance sector in UAE will be very beneficial to the society in terms of providing accountancy, auditing and bookkeeping services to other business people and investors. Financial services are important to every society when it comes to funds management. Not everyone is an excellent money manager, but financial service experts are well trained to help consumers spend less and save more. A finance sector ensures that it safeguards the integrity and savings of financial contracts. Investors can have a broad access to safe means of saving, with reduced risks and easy accessibility of funds. Investors can also be able to have legal and operational consistency across all financial products, contracts and transactions. By engaging in the provision of financial services, the members of the society are provided with a broad access to financial products and services. Business people can access financial services across the globe, including low- income and disadvantaged sectors. Providing financial services will be beneficial to the society since it will make payment of goods and services easier. Money transfer will be made easier for both domestic and foreign investors. Business people normally operate with a large sum of money, and it is risky for them to carry this money physically. Therefore, financial services will provide ways to make payments to suppliers without necessarily carrying large sums of cash in their pockets. Finance sectors provide accurate and secure payment methods between counterparties for the exchange of goods and services. A finance sector will also enable smoothing consumption and cash flow over time. It provides ways to balance saving and spending during different stages of life. These services help individuals who typically spend more than what they earn or those who spend less than what they earn. Investing in the finance sector will benefit the society through facilitating efficient allotment of capital to enhance economic growth. It helps individuals borrow funds for present and upcoming needs. It helps entrepreneurs raise capital for new ventures or to finance day-to-day activities of the business. Provision of financial services will gather, scrutinize and give out information for better investment decision –making. Financial specialists offered objective and trusted advice about using financial products and information that meet an individual’s objectives reducing investment risks and search costs (Publications, 2014). Explain why small business opportunities can help the economy and Business sectors in general In many countries, small businesses represent the ninety-eight percent of all business established, and they produce approximately sixty percent of all net jobs in those countries. Small businesses are considered to be at the forefront in terms of providing employment, and therefore they provide the initial training for a nation’s workforce. The role of the small business sector in national development can be evaluated in terms of a variety of consistent economic, political and social issues. The economic contributions include wealth creation, employment creation, and mobilization of local resources, increased output and adaptation to technologies (Hailey, 1991). Job creation With quick population growth, there is increased demand for employment that absorbs surplus labor. Small businesses sectors provide work for more labor per unit of output or capital than other larger companies do, and they are perceived as a low-cost means of establishing new jobs. All over the world small business sectors, being local, labor intensive and small have confirmed to absorb the surplus domestic labor. The World Bank argues that small business enterprises create up to eighty-five percent of the entire employment in the manufacturing segment. The most analyst acknowledges the fact that small business sector plays a significant role in the creation of employment. Income generation and poverty liberation As a chief source of employment, small business sector is known for being capable of creating income of a big part of the population, especially the unskilled and less educated, and for this reason, small business sector is in the forefront in poverty reduction. Small size enterprises (SSE) are reducing the symptoms that are associated with poverty such as health conditions, poor dietary, rural- urban migration, and high birth rate. In other words, expansion of opportunities n SSE can reduce some of the pressures that arise from the rapid fast population growth. The income earned from small business sectors can assist to improve the health of the population, and remove consequences of poverty such as poor sanitation, poor diets, and inadequate water supplies. Competition and mobilization of resources Small business sectors mobilize and utilize resources more efficiently than the large firms utilize. They tend to make use of natural and local raw materials, agriculture produce and scrap. They are supple enough to utilize them in a way that meets the particular needs of the domestic market. Since they have local contacts SSEs, they in a better place to assemble local savings and acquire finance from local and informal sources. In most cases, owners of small businesses have high opportunities to save and re-invest back earnings compared to owners of large operations. Small business ventures can keep away from the economic inefficiencies and inflexibility of larger entities. Output and Growth The small business sector accounts for a major proportion of national output, primarily producing for the local consumption. SSEs are also contributing a small but significant portion of export earnings. Additionally, they can sustain healthy growth rates even in times of economic crises due to their adaptability and flexibility and their close connection with the domestic markets. SSEs are mechanisms for development since they are an appropriate vehicle for the entrepreneurial individual, and their presentation the dynamism of their organizer. Small ventures by the temperament of their size reflect the character of the organizer expansionist growth profile. Innovation Development is all about innovative thinking and change and as such small business enterprises is an essential part of this advancement process. SSE is a valuable seedbed by which exploration of new products; new ideas and opportunities are germinated. Entrepreneurs are representatives for providing drive, change foresight, and energy. Entrepreneurs start new businesses every year, a high percentage of this businesses fail within the second year of operation, but from those that survive there are new opportunities, new initiatives and new goods and services. SSEs are now prepared to adapt intermediate technologies or recycled equipment to local needs and thus not employing unnecessary capital-intensive technology. References Hailey, J. (1991). The Small Business Sector in Developing Economies. New York: Cranfield School Of Management. Publications, I. B. (2014). How to Invest, Start and Run Profitable Business in the UAE Guide. Qatar: IBP Inc. Spraggon, M. (2014). Managing Organizations in the United Arab Emirates. Dubai: Bodolica. Read More