Five good reasons why being proactive in seeking legal support is crucial for small businesses
By Andrew Gregory, Director, Leonard Curtis Legal
UK SMEs are historically reluctant to use lawyers to take care of their legal business, which can result in significant financial loss. A recent study showed that these businesses currently lose an estimated £13.6 billion a year by failing to tackle an average of eight legal issues - costs that can often be avoided.
The value of accountants and lawyers working collaboratively has long been recognised by the Big Four accountancy firms and the big businesses they represent are reaping the benefits of their increasing integrated legal offering. This joined up approach isn’t quite so easy for SMEs to access.
In an increasingly litigious and complex SME environment, there is a greater need than ever for accountants, lawyers and other professional advisors to work more closely together. It’s this multi-disciplinary approach, as part of an integrated service offering, that can add real value to a business.
The value of proactive legal support
Incorporating legal advice into general commercial planning and management is the approach being taken by the most progressive SMEs and their advisors.
Here are some of the main benefits of seeking proactive legal advice.
- Future proof your business
SME business owners and their accountant advisors can work with lawyers to identify and proactively manage hidden risks and threats which, if not addressed now, may cause significant disruption to current business operations and jeopardise future success.
- Create a deeper business understanding
By introducing a lawyer to their business and other advisors, they’re best placed to understand – and advise upon – their strategies and ambitions.
It’s a position that brings with it a sense of security for clients as their legal advisors already know them, their business operations and aspirations.
- Stay at least one step ahead of the game
From experience, we know that by the time many SMEs instruct a lawyer, they’re already at a disadvantage. Legal disputes can be more advanced than first thought and the position could have deteriorated without the correct initial steps being taken.
For many SMEs, earlier legal engagement can often secure a better outcome. By having access to advisors who understand the ever-changing legal landscape ensuring operations are fully compliant is a positive step.
In addition to formal legal engagements, lawyers are often happy to simply act as an invaluable ‘sounding board’ - enabling business owners and their advisors to check out any uncertainties that would ordinarily incur costs.
- Enjoy ongoing peace of mind
Legal advice shouldn’t only be accessed to tackle worst-case scenarios. Proactive legal advice should also be given to support the day-to-day. This might be to advise on contracts for new members of staff, the introduction of new laws and legislation, selling shares or taking on finance – safe in the knowledge that there won’t be any future nasty, and potentially costly, surprises.
- Plug specialist gaps and extend in-house capabilities
A fully integrated legal approach can plug any specialist skills gaps within the business or accountancy practice that supports it.
Providing the necessary legal support to UK SMEs
The right legal protection isn’t something small businesses can risk. It’s long been an issue that the law industry itself needs to provide the necessary legal infrastructure and support required by the UK’s SMEs to survive and grow. This includes easy access to legal advice, clear and understandable documentation and affordable fees.
It’s essential to change the perception of legal service providers - and the way that they can be accessed - so that more SMEs can reap the benefits of using them.