By Paul Weber, Society of Professional Accountants director.
Though many businesses have struggled during COVID-19, certain sectors seem to be thriving. Which leads us to ask, which booming industries should accountants who are members of the SPA be targeting in 2021?
When the first lockdown kicked in from March and the majority of high street shops were obliged to close, many of us turned to online retailers – either for essentials or simply for retail therapy.
It’s no surprise, then, to hear that multinational giant Amazon has achieved record profits, but there has also been a growth in UK eCommerce.
In May, Business Data Group, which specialises in managing UK business registrations, published information on new eCommerce company formations. The graph formed a classic hockey stick, shooting into the air from around March.
That’s backed up by the latest stats from the Office for National Statistics (ONS). From its data we can see that eCommerce took 33% of retail sales in May – a sudden 11% increase on the previous high. Even though shops reopened in June, it has retained much of the increase, sitting at 26% as of August. With a lockdown holiday season looming, there’s no reason to expect a reversal.
With all that in mind, if you aren’t up to speed with the latest thinking on tax and compliance for eCommerce, it’s worth making that a CPD target for the next year. If it is an area of expertise for you, make sure your practice is advertising that fact with a dedicated web page and blog content.
A related industry is fast food delivery via app, from Deliveroo to UberEats.
With everyone trapped indoors and in need of indulgent treats, Europe-wide firm Just Eat Takeaway reported a huge increase in earnings – €177 million, compared to €76 million at the same point in 2019.
As of September, Deliveroo was seeking to recruit 15,000 new delivery drivers in the UK, offering a much-needed antidote to the rising tide of stories about post-furlough-scheme redundancies.
The growth of these businesses has been fuelled not only by demand for comfort food but also by a scramble among catering and hospitality businesses to pivot online.
Although services such as Just Eat take a slice of profit, for many, it seemed better than nothing, and certainly easier than setting up their own online ordering portals overnight.
If your firm specialises in working with takeaways, restaurants, bars and pubs, think about how you can bring your knowledge of the various delivery services up to scratch.
You’ll also want to make sure you know the ins-and-outs of ‘dark kitchens’ and perhaps have some advice at hand on how your clients can set up their own online stores rather than relying on third-parties.
Finally, what the two examples above tell us is that businesses providing underlying technology and infrastructure to enable the growth in eCommerce are going to be booming, too.
What is your offer to digital marketing agencies, web designers, hosting businesses, app developers and software firms?
It’s more important than ever that you can demonstrate an understanding of research and development tax relief, innovation grants and, of course, off-payroll working rules as we head into 2021.
Join SPA for access to further advice, mentoring and networking for accountants.