A quarter of small businesses had their IP infringed in last five years

Research from the Federation of Small Businesses reveals that companies are struggling to protect their invaluable IP

A quarter of small businesses had their IP infringed in last five years

The importance of protecting the intellectual property (IP) of one’s business is something we’ve touched on a few times before. And for good reason. With IP tending to account for a significant proportion of a company’s value, failing to protect it can put a business’s revenue stream and success at serious risk. But, according to new research from the Federation of Small Businesses (FSB), this is the fate befalling a worrying number of small firms. 

The FSB surveyed over 1,000 businesses with intellectual property rights and found that a quarter of them had suffered some sort of violation within the last five years. This is despite 32% of firms saying they had spent money on securing their IP rights in the same time period, with around one in five of those companies investing more than £5,000. According to the research, the most common form of IP theft was the copying of a product, with half of firms falling victim to it. Meanwhile, 34% of thefts involved the use of copyrighted work on a website, with 33% involving the use of copyrighted work in a service or product for sale and 31% the use of a trademark.

Considering almost one in three businesses that own some form of intellectual property rights are reliant on them for 75% to 100% of their revenue, it’s plain to see why the infringement of these rights can be so damaging for small businesses. And, in spite of some government reforms aimed at helping businesses that include the Intellectual Property Office’s mediation service, the FSB’s research revealed that almost a third of small firms that had their intellectual property stolen took no action against the perpetrators. More than two fifths of those questioned said they directly contacted the party that had infringed their IP as a means of addressing the issue. 

Among the reasons given by small businesses for not taking action against infringement were the costs involved, a general lack of resources and a lack of awareness of appropriate routes.

With a fifth of businesses saying their investment in protecting their IP was not good value for money, the FSB’s national chairman John Allan has called for the introduction of better support measures for small firms.

“Left unchecked, theft and infringement of ideas, patents and brand costs small businesses and diminishes their appetite to invest in their business, ultimately hampering the UK’s long-term economic growth,” said Allan. “When infringement does occur, redress should be simple, swift and easy to obtain.”

It seems the IP landscape in the UK is still short in its support for small businesses. 

Adam Pescod
Adam Pescod

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