Figures Reveal Trends About How Firms Are Planning For Future

By Rob Dixon

New research showing that small and medium-sized enterprises (SMEs) are failing to plan for the future highlights the need for them to consider the serious consequences of not doing so, a top business lawyer has warned.
 
According to the study by Lloyds TSB Commercial Banking, 34 per cent of small businesses across the UK are failing to consider succession issues, with those specifically based in London and Essex being the least likely to address this.
 
It was also revealed that while Scottish and Welsh firms would expect a business to remain within a family, many in the South West would expect a managerial change to lead to a trade sale. Real estate and financial services businesses were also found to be the most prepared for succession.
 
Steve Beahan, a Partner in Irwin Mitchell’s Commercial Litigation team and part of the firm’s SME Group, said the figures demonstrated how there remains a lack of awareness of the huge implications that succession can have on a company and its future.
 
He outlined: “With the number of SMEs in the UK growing significantly at present, this is of course becoming an increasingly important issue.
 
“It is vital that small businesses consider succession well in advance of when they need to, specifically due to the tax and legal issues that are involved in this. We have seen cases in the past where disputes have arisen from a lack of forward planning, with some of them proving costly.

“The lessons to learn are fairly straightforward on this – carefully plan for retirement and succession to avoid potentially serious consequences in the future.”

Read more about Irwin Mitchell's expertise in relation to SMEs