Kirklees businesses are underestimating their true worth by not taking into account the value of assets such as trademarks, patents and intellectual property, according to new research.

The study by Yorkshire Bank showed that just 21% of small and medium-sized businesses in Yorkshire SMEs have ever taken steps to value their non-physical assets.

As a result, SMEs may not be making the most of growth opportunities – as about half of those questioned said they didn’t think their bank, shareholders or other lenders had an accurate understanding of their business’ intangible assets.

A business’ intangible assets are those which are not physical – such as copyrights, franchises or brand reputation. They are often created through research and development activity.

However, the Yorkshire Banks survey also revealed that most businesses seem to be failing to take full advantage of government incentives to encourage R&D and fuel business growth.

Just 15% of Yorkshire SMEs have ever accessed government R&D incentives. And only one in six has a dedicated R&D budget – despite 54% of firms polled claiming to undertake some form of research and development.

In the last 50 years, the makeup of the UK economy has shifted from being dominated by manufacturing to being service-led. As a result, many businesses have had to invest to bring them a competitive edge.

Figures from the Office for National Statistics show that since 1997, the share of the service sectors’ contribution to the UK economy has risen by 54% to 80%.

Yorkshire Bank’s new research suggests SMEs from all sectors could do more to innovate by taking advantage of government schemes or encouraging staff to be more creative. Only a third of Yorkshire SMEs incentivise staff, financially or otherwise, to come up with ideas to improve their business.

The survey said the larger the business the more inclined it was to invest time and money in research and development and have a more accurate understanding of its intangible assets. Businesses which tend to be more active in R&D include IT and manufacturing.

Alan Young, regional director for Business and Private Banking at Yorkshire Bank, said: “The UK economy has changed considerably in the last 50 years in terms of what we produce and the types of job being created.

“Whether they are a manufacturer in the automotive supply chain or an IT software developer, it’s vital that businesses have an accurate understanding of the value of their intangible assets and the difference this can make to their business. They also need to be fully aware of the incentives available to them which are going to drive their business forward.

“With many firms having few or no physical assets, it becomes increasingly important they have a full understanding of their business’ true value.

“Having this knowledge could significantly enhance the possibilities of accessing finance for growth, with profitability and cash generation, rather than the quality of the asset base, becoming an ever more important consideration for those lending or investing.

Yorkshire Bank said it had strengthened its support for UK SMEs by becoming the first to partner with the British Business Bank under its ENABLE Guarantees scheme.

Up to £125m of new lending by Yorkshire Bank, guaranteed by the British Business Bank, will help more small businesses achieve their growth ambitions.

The survey findings were revealed as Yorkshire Bank kicked off its Business Week, which will see more than 250 customer-focused events take place in the bank’s UK network of business and private banking centres.

The events will focus on areas such as succession planning, improving cashflow and inspiring the next generation of business leaders.