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The legal needs of small businesses

Background

Small businesses comprise 99% of all businesses, and 48% of all employment. In 2017 estimated turnover of small businesses was £1.3 trillion - or 37% of total business turnover in England and Wales.

It has been a strategic aim of successive governments to make the UK the best place in the world to start and grow a business. Ensuring that small businesses can easily access information and advice to anticipate and deal with legal issues they commonly encounter - from disputes with suppliers to breaches of intellectual property to employee matters - is integral to this aim.

However, there is evidence that small businesses face barriers accessing legal advice. Our research estimates the financial impact of legal problems experienced by all small businesses in 2017 at £40bn with over 1.1 million individuals suffering ill health.

Our research

The LSB carries out the largest published survey of small firms’ interactions with the legal sector. The 2017 edition of the survey - the third wave of this research - interviewed 10,579 owners and managers of small businesses.

Our research analyses the experiences of small businesses in today’s economy, showing the origin of legal problems that they face and their strategies for dealing with these problems, including where they seek advice and their experiences of doing so.

The latest research found that the number of legal problems faced by small businesses has reduced, but barriers to accessing legal services persist. In particular, legal services are perceived as expensive, meaning that problems are ignored or small businesses try to handle them alone.

The research findings and related material can be found here.

Next steps

We held a roundtable chaired by the Small Business Commissioner to discuss the findings and we will continue to explore opportunities to raise awareness of the research and engage in debates on how best to break down barriers to access.

We will also conduct further analysis of the research data and issue statistical releases on our research webpages.

We will work towards commissioning the fourth wave of the research aiming for publication in 2020.

Further information

If you would like to discuss our work please contact Steve Brooker, Head of Research and Development, at steve.brooker@legalservicesboard.org.uk.