By Daniel Hunter

The UK's small businesses are struggling to protect the identity and ideas at the heart of their businesses, according to the Federation of Small Businesses (FSB).

Time and money spent on protecting intellectual property such as patents, branding and product designs takes valuable resources away from business development, potentially putting growth and innovation at risk.

Protecting intellectual property is critical for the UK’s increasingly knowledge-based economy. Yet a quarter of the businesses surveyed by the FSB with intellectual property rights (25%) suffered some sort of violation or wrongdoing within the last five years.

With almost one in three small businesses (30%) who own some form of intellectual property rights reliant on it for 75 to 100% of their revenue, infringements of these rights can be incredibly damaging to small businesses.

There are a number of tools and services in place that have been developed by the Intellectual Property Office to help secure and protect intellectual property rights, helped by recent reforms, but this research shows that small firms continue to find it difficult to use them. The FSB is calling for ongoing efforts to improve signposting and simplification to encourage take-up of the available support.

John Allan, National Chairman of the Federation of Small Businesses, said: “Proper protection of intellectual property is a mainstream issue which deserves a mainstream focus. The knowledge economy, which runs on innovative ideas and brands, is becoming ever more critical to our economic success. 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.”

Martin Brassell, CEO of Inngot and co-author of a recent government report on intellectual property, said: “Intellectual property and intangibles are the things that make every knowledge-based business tick. Obtaining appropriate protection is a sound investment, but one that needs managing - it’s not a case of ‘fit and forget’. This is why companies need simple and cost—effective ways to identify important assets, recognise their value and manage their rights."

One in three (32%) firms with intellectual property rights said they had spent money on securing rights within the last five years, with one in five (22%) of those investing more than £5,000.

Even with this security, intellectual property is still regularly stolen. The most common forms of theft are through the copying of a product (50%), use of copyrighted work on a website (34%), use of copyrighted work in a service or product for sale (33%) and use of trademark (31%).

The Intellectual Property Enterprise Court’s small claims track, the Intellectual Property Office’s mediation service and the intellectual property finance toolkit are positive reforms the Government has made to help businesses. However FSB research indicates that around a third of small firms (29%) who had their intellectual property stolen took no action against perpetrators. Two fifths (43%) of those questioned said they used direct contact with the infringer to address the issue.

Some reasons small businesses gave for not taking action against infringement included the costs involved, a general lack of resources and a lack of awareness of appropriate routes.