Business Leader recently spoke to Peter Lomax, Partner at Thomas Wescott Chartered Accountants to discuss how his firm is helping businesses throughout the growth journey, the future of fintech, and what we can expect to see in the M&A market in 2021.
Can you give an overview of Thomas Westcott and your role in the business?
Thomas Westcott has the largest network of accountancy offices in the South West, with 33 partners and more than 250 staff operating from 17 offices.
We offer a broad comprehensive range of sector and service specialisms and have supported a diverse range of businesses and individuals right across the South West and beyond for more than 30 years.
I actually joined the firm quite recently from KPMG, where I led the firm’s financial services audit practice in the South West. I was attracted to Thomas Westcott because it’s a forward-thinking firm that’s known for being committed to outstanding, highly-customised client service.
I’m responsible for our team in the Weston-super-Mare office, making sure that we bring consistently high levels of service and support to our clients across North Somerset.
How can Thomas Westcott help businesses?
Thomas Westcott prides itself on the strength of its relationships with clients. With our partner-led service, our aim is to understand fully our clients and their businesses, adding value and helping them succeed. Once we understand our client’s business, we can help understand and define their objectives and work with them to achieve their goals.
We can support businesses of all kinds – large and small – ensuring all our clients have access to the highest level of expertise. We deal with businesses throughout their lifespan – from supporting start-ups and working with growing businesses to helping owners exit their business, whether via a sale or passing it onto the next generation. We also provide financial advice to business owners to help them achieve their personal finance objectives alongside supporting businesses and individuals with their tax affairs.
You recently completed a merger with Riley Chartered Accountants – what does this mean for the future of the business?
Bringing the Riley Chartered Accountants team into our Plymouth office is part of our continued growth across the region. We have brought new skills and new ways of thinking into our business which means added value and insight for our clients. This positive impact won’t just be felt in Plymouth. Because of the way we work, these benefits will be felt across the firm and all our clients.
You recently produced an interesting article on the role of FinTech within the SME community – what can we expect to see in 2021 and beyond?
If we give them access, FinTech companies will be able to use our data in more innovative ways. People are already used to seeing businesses such as Netflix, Amazon and Google make recommendations to you, based on past behaviour. I believe FinTech firms will start to do this more and more, so when they see a trend in your data, they will be able to recommend financial products that you might not even realise you need.
From your perspective, how can an economic recovery be achieved post-COVID?
The World Bank has said that countries will need to allow capital, labour, skills and innovation to shift to a different, post-COVID business environment. There are examples of this all around us:
- People are learning new skills, with former pilots, bar staff and shop assistants all taking up jobs in new sectors.
- Businesses are innovating – perhaps you’ve been to a drive-in movie recently or seen entertainment streamed online, rather than at the theatre.
- Capital is shifting to where it’s required as well – suppliers of in-demand equipment, from bicycles to hot-tubs, have struggled to keep up with demand, but will increase production. Some sectors are struggling, while others thrive.
To succeed, businesses and individuals will need to invest in new talent and equipment to meet the needs of a post-COVID economy. Individuals will need fresh skills and businesses will need different tools. As ever in business, those who spot trends early, react quickly and are able to access the funds, labour and materials will be the ones to succeed.
Regarding M&A activity – will we see an increase this year? If so, why?
I believe there will be an increase, for two reasons. First, activity was low last year, but rose dramatically in quarter four. Second, because of the likelihood of structural change in the economy, investors will seek to move their capital to businesses that are more suited, or can evolve to be more suited, to coping in the post-COVID world.
There are signs that owner-managed businesses are making decisions about the future of their business, with some deciding to exit rather than go through another economic downturn or face other unknown events. Any tax changes in the budget regarding Capital Gains Tax (CGT) could also drive activity. Buyers are in the market looking to diversify or strengthen existing revenue and profits too.
Post-COVID, will sustainability become increasingly important to businesses in all sectors?
Sustainability will be increasingly important in two ways as we recover from COVID. Firstly, businesses will have to become more sustainable and more resilient. This means that they will need to be prepared to weather future storms. We’ll never be completely free from COVID and we may have local restrictions or rules to contend with as new variants emerge and vaccines take time to catch up.
Governments will need to give clear indication as to what form these restrictions might take, and businesses will need to be prepared to deal with them. Whether it’s a temporary disruption to their supply chain or to their customer base, they will need a plan in place to keep the business going.
Secondly, businesses will have to take account of the needs of their customers. Conventional wisdom is that in times of financial hardship, consumers make less ethical choices.
However, in my view, the nature of this pandemic, and the collective period of reflection that it’s forced upon us all, may mean that the opposite is true. People have had time to reconsider what they want from their lives, and, just as importantly, what they want from the products and services they consume. Businesses will have to demonstrate they take these concerns seriously and that they meet the high ethical standards their customers set.