A smaller business with limited time and budget will often see contacting a lawyer almost as a last resort. So how much are unaddressed legal issues costing SME businesses?
According to research conducted by the Legal Services Board, 23% of SME businesses reported significant loss of income, 12% reported an increased cost, 9% reported damage to their reputation, and 6% reported that employees had to be lost or the business closed down – all through unaddressed legal issues.
46% of SMEs reported that unaddressed legal issues impacted their business, with an average cost per issue of £13,812. Multiply this by the number of SMEs affected and you soon get to an eye watering number.
Those figures suggest that a staggering amount of cost and disruption could be saved if more SME businesses sought appropriate legal advice much earlier. In truth, many costly legal disputes and tribunals that SMEs become involved in are avoidable. Similarly, many SMEs delay enforcing their legal rights because they assume it will be too costly or complex.
With such significant potential costs and impact on their business, why are many SMEs reluctant to seek the legal advice they need? Sometimes it seems to be a concern about potential costs that could run out of control. Sometimes it’s a failure to recognise that there is an underlying legal issue that needs to be addressed or it may just be a hope that things will sort themselves out without legal action. Decisions are often directed by assumption rather than fact, which is rarely good business.
Given the possibility of financial cost and disruption to your business it’s better to know exactly where you stand – to know whether you have a potentially expensive liability or whether you have legal rights that can be enforced. If you also know the probable costs of any legal action you can be fully in control of the situation. You can then make smarter business decisions and avoid issues snowballing.
Recognising the predicament that smaller businesses face, PowellsLaw launched the Law on Call service. For a fixed monthly fee of £30, businesses can call the team as often as they need, to go through an initial assessment of your concern which could be, for example, employment, property, contracts, ownership or disputes.
Once you have had that assessment and are aware of your options for the best route forward, you can then make an informed choice how best to proceed. What each business then choses to do is up to them. There are no obligations but you’ll be clear where you stand and you will be making your business decisions based on fact rather than assumption.
For more information on this Law on Call service contact us today on 01934 623501 or visit our website.