Sean Toomer is the owner, founder and MD of Diverso Accountants, an innovative subscription service working exclusively with small businesses and start-ups, providing not only accounting, but an extensive package of free support which includes accountancy and bookkeeping software, training, mentoring and advice, networking and free legal and IT support. A self-confessed ‘industry disruptor’ Sean is as far removed from the stereotypical accountant as it’s possible to be. His mission? To give small and micro businesses the service and support they need and deserve. Here, Sean discusses how small businesses can use agility and innovation as an advantage in a post-COVID world.
We are in the era of the small business. Small businesses are the backbone of the British economy with a combined annual turnover of £1.9 trillion and they employ 60% of private-sector workers outside of London. They’ve been hard hit – like everyone else has – by the events of the past five months. But they are also the best equipped to bounce back and to adapt and thrive in this ‘new normal’ in which we find ourselves. And here’s why.
Turning on a sixpence
One of the things which makes small businesses so interesting and unique is the way they can react quickly to change; they can innovate and pivot at a pace according to the demands of their customers and the circumstances in which they’re trading. As a small business owner myself, working exclusively with businesses with a turnover of less than £250k and fewer than ten employees, I can tell you, these are the people and businesses which excite me.
At a time of such wholesale and rapid change such as we have all just experienced, it is this innate ability of the small and micro business which sets them apart. While big companies and chains are encumbered with many more cogs and moving parts which inhibit innovation and adaptation, small businesses can completely change their approach almost overnight – as we saw when lockdown happened. It was the independent pubs and cafes which switched to providing take-aways and deliveries, while the big chains just shut up shop.
What lockdown has done is accelerate big changes in our society which were already coming; the move to e-commerce, working from home, virtual communication, the rise of social media as a vital means of connecting with customers. Before these changes were coming slowly, at a lumbering pace which suited larger companies. But now is the time for the agile small businesses to put down the accelerator – only they can pace-match the changes we’re seeing now.
Systemise and automate
One of the first things I would urge small businesses to do is embrace the technology and software platforms available to them to automate as much as possible. Platforms like Xero can help you maintain accounts consistently while Receipt Bank will allow you to capture, store and keep track of your business receipts, bills, invoices and bank statements.
Basically, you want to be doing everything you can to get paid as quickly and easily as possible. There is nothing more frustrating than going into a café or shop which doesn’t take card payments for example – especially now – when it is so easy to get card payment technology set up and integrated.
So often small businesses develop in an ad hoc way over time, but this period has provided an opportunity to step back and systemise. Small business, even single-person side hustles, should have clear systems and processes which not only makes everything easier for them, and easier to scale up, but also helps ensure the customer’s experience is the same every time.
Alternative revenue models
~Business Game Changer Special Promotion~
The other thing COVID has shown us is the benefit of alternative payment models. We are (we think!) one of the first accountancy companies in the country to offer a subscription-based service – and it’s an approach we have encouraged our clients to adopt in the past too.
The subscription model has far wider applications than we’ve traditionally seen, but it means thinking differently about how you do business. For example, we work with a web developer who now charges clients a monthly fee to set up and then maintain their sites, rather than a big one-off charge just to build them. And a video production company we work with moved away from one-off jobs, and now offers clients a certain number of videos a month for a subscription fee. Both, like us, were almost completely insulated from the tidal wave of uncertainty which came with COVID.
Building a monthly recurring income over time means in the event of a crisis, you’re are not going to be thrown over a cliff edge of massive unpaid invoices and evaporating business. Your cashflow is so easy a 12-year-old can do it, and crucially you build better relationships with customers, who grow to value and rely on you.
In our experience it stops the relationship being purely transactional – customers become clients. Many of our clients consider us part of their team, and they find it much easier to engage with us on that basis. If they have questions or need help, they can pick up the phone without being scared they’re going to be slapped with an unexpected bill.
Connection
Being a small business owner can be quite isolating, and that was even more the case in this pandemic. The tendency can be to turn inward, but as in every part of life, it is our connections and our relationships which keep us strong.
Businesses that maintained connections with their customers in lockdown – the hairdresser posting videos about how to dye your hair at home, the dance school providing a daily dance work out online – these are the ones swimming back up fast as we come out the other side. They might not have made any money, but they have built up bucket-loads of goodwill
Likewise, small businesses must keep connected with other small businesses – it is a great source of inspiration and advice. For that reason, we host monthly networking meetups with speakers for our clients, as well as offering regular training and all manner of advice and support – even free IT support and legal advice. It just goes to show that being part of a community, part of something bigger, can bring tangible benefits to your businesses, as well as all that other feel-good stuff which comes from building relationships with like-minded people.
Setting yourself apart
Perhaps the thing I love most about small businesses is how original they can be. They are not moulding themselves to any mode of behaviour or approach based on the past. They are not hamstrung by tradition or blind faith in ‘the way things have always been done’ as so many big businesses are. They are self-creators; they can make up their own rules, and that’s exciting.
I would urge all small businesses to capitalise on this incredible freedom they have. Find out what your customers want and need – not what they’re used to – and give that to them. Try to imitate your competitors and you’ll capture where your kind of business has been; do it differently, and you’ll capture its future.
We’re a good case in point. Diverso is the opposite of what you think of when you think of an accountant. We don’t wear suits; we don’t begin emails Dear Mr Smith; we’re not just interested in numbers – we’re interested in people. So, while some other accountants have been charging their clients for every additional service in lockdown – from loan applications to furloughing claims – and effectively making money out of other businesses’ misery, we’re proud to say we haven’t made a penny from COVID. Yes, it’s been a lot more work – in fact, it’s been like being in a war! But a war we’re winning. We’ve made a huge difference to our clients, and we have banked appreciation, goodwill, and reputation in spades.
Controlling your own destiny
Here’s the big one. As any entrepreneur will tell you, starting up your own business is not just about following a passion, or a big idea, it’s about autonomy – calling the shots in your own life. So many people will tell you it’s a big risk or a scary undertaking – but ironically having your own small business might actually be less risky than having a job in the current climate.
Taking control of your own destiny, seizing opportunities, creating recurring income streams, systemising, and making life easier for yourself, connecting with and being inspired by others, and doing things your own way. That sounds to me not only like a recipe for success in this new post-COVID landscape, but also for fulfilment. To my mind, that’s a far better place to be than in a 9-5 job right now.
