Here is our sixth Industry Insight from Simon Rudd from Coastal Accountants. Some good financial advice from Simon in this one so have a read and make sure you are making the most of all the support available during COVID-19.
Industry Insights from: Simon Rudd
Company: Coastal Accountants
Q1. Are you still operational as a business and is this currently normal in your sector?
Yes fully operational and this is norm for our industry (Accountancy).
Q2. If still working how have you had to adapt your business to keep working?
Yes – Working remotely from home. Additional duties on some staff as others off for COVID-19 reason. Increased workload due to claims to make and advice to clients on COVID19 Gov schemes. Otherwise business as normal.
Q3. What’s the biggest negative impact COVID-19 has had on your industry so far?
Delayed payments, potential bad debts and insolvencies, increased workloads. Staffing issues due to School Closures. Accountancy industry normally runs 9 months after any recession so impact may not be felt until next year.
Q4. Have you found any new business opportunities during COVID-19 for your industry or any positives that have come from this situation?
Additional support for clients with claims but supplied at cost. A number of new clients as we have taken proactive approach in advising clients which has generated a number of inquiries from contacts of existing clients as other practices have not taken this proactive approach.
Q5. How are you supporting your clients out of the ordinary during COVID-19?
We are providing updates on Government support and helping with applications for JRS, CBILS and rates grants.
Q6. What’s the most important thing that COVID-19 has taught you so far in your industry?
That our client portfolio is low risk and adequately spread across a number of industries and this is important to carry forward. The majority of our clients have strong a balance sheet and listen to advice from us. We have spent a lot of time over the last 9 years creating a strong client base of good companies with no one client above 6% of our total sales. Whilst this has in some way limited our growth we have still created sustained growth mostly through word of mouth but importantly we have gained good quality clients and our portfolio offers low risk in times such as these.
Q7. Would you say that currently during COVID-19 your industry is on a decline, plateau or incline and what makes you think this?
I would say that the industry is in plateau. Smaller practices such as ourselves have a large proportion of recurring work that is compliance based and required by law. Therefore unless there are significant business failures the work is still required. Some national or large regional firms may have more of their turnover based on advisory work which could decline or have a high percentage of turnover with a few very large businesses which could represent a risk.
Q8. If anything, what more do you think the government can do to support your industry?
The Government Support has been excellent to date. The only criticism is that there is a scatter gun approach and there are significant “black holes” where support is not available. In particular support for Directors of limited companies who take a high proportion of dividends as income. No help is available to these companies, whether this is a political move to punish potential IR35 companies or is just impracticable to support is the question but it has left a large number of genuine small businesses without support other than debt.
Q9. If you are not already when do you think you will be back working from your office, will you have to adapt the way you work initially and if so how?
I would anticipate being back at the office by the end of May.
Q10. When do you think it will be “business as usual” again for your industry and what makes you think this?
June 2020 as restrictions are relaxed on non essential travel and working.
Q11. What do you miss most during lockdown?
Seeing friends and family. Being in the office to work, being able to nip to a shop to get one or two items, going swimming.
Q12. What’s the best tip you can give to others to help them cope with life in lockdown, both in business and personal life?
In business – Carry on as much as possible, find ways of generating revenue, be innovative in your approach to see if there are anyways in which you can deliver your services/products in the current climate. Prepare cash flow forecasts with worst case scenarios, plan for this obtain payment holidays on loans/mortgages if required be ahead of the curve on any cash flow shortages. Make sure you check with your accountant you are claiming all the available help possible. Job Retention Scheme, Grants (Rates) for Small businesses with Premises £10k, Grant (rates) for larger hospitality and retail business £15k with business premises, Bounce Back loan 100% backed by government, Business Interruption Scheme Loan, VAT payment holiday, time to pay on all other taxes.
Personal – make sure you get out on your exercise everyday, meet up with friends on Zoom regularly, dont read too much news and remember this is temporary.
Thank you to Simon Rudd from Coastal Accountants for taking part in this survey. If you would like to give insights into your industry during COVID-19 to help other businesses please get in touch.