Every year The Sunday Times release the Fast Track 100 league table and Ones to Watch list showcasing the fastest growing businesses in the UK. As a champion of mid-sized, entrepreneurially spirited businesses and a proud sponsor of the Fast Track, we have been speaking to some of the business leaders featured.
We want to know what’s keeping them up at night and their thoughts on how government can create an economic environment that supports their ongoing growth. Here is what those business leaders told us;
There is a desire for the government to be clearer on tax policy. In the run up to the 2019 General Election, businesses were very concerned about the tax implications of a change of government. An increased majority for the Conservative Party may have given businesses some more certainty, but with Brexit finally on the horizon, uncertainty over taxes may well build again.
Infrastructure is at the top of the agendas of the UK’s fastest growing businesses too. Alongside improving transport links across the UK, this year’s Fast Track sees a rise in the number of businesses involved with Electric Vehicles or ‘mobility as a service’. In comparison to other countries, many in the sector feel the UK government is behind the curve. Even in larger cities, charging points can be few and far between which is inhibiting the growth and expansion potential of the technology.
There is still a lack of clarity and awareness around the types of incentives and grants available for companies looking to grow. R&D tax credits remain a hot topic; are businesses taking full advantage and maximising claims? We’ve seen a trend in businesses looking for second opinions on previous claims to ensure all eligible projects have been claimed against.
Another pressing issue raised by the companies we met was around efficiency and operational systems. As companies grow quickly, attention to and investment in systems can fall by the wayside leaving them no longer fit for purpose. Turning fast growth into sustainable, profitable growth relies on effective reporting on performance – so selecting systems that can scale with your business is key.
Many Fast Track companies are leaps and bounds ahead in this area, buying other data-driven businesses in order to bring tech development teams in house. Productivity is the main goal here. For example, some companies have created tools that measure their workers’ tiredness levels and identify which team members work better together based on personality data.
Technological advances are also needed in order to keep up with the changing attitudes to the workplace. A large portion of companies in the Fast Track 100 list have adopted flexible and agile working environments. They rely on systems to create a seamless connection between employees wherever they are.
It’s been exciting to see the range of e-commerce and retail businesses leveraging data and technology to better understand their markets, consumers and buying trends. This enables them to create products that really gets to the heart of what their customers want, when they want it. Technology that can help retailers improve their warehousing and shipping efficiencies are highly sought after – as there’s an acknowledgement that retailers must be both competitive with price and delivery time too.
The businesses featured in this year’s Fast Track 100 list have achieved fast growth over three years in an uncertain economic environment that has impacted customers, suppliers and markets. This might explain why the businesses we spoke to felt less concerned about Brexit than we expected. Many have robust plans to weather any future uncertainty. Nonetheless, there are some uncertainties which are worrying companies.
Businesses already trading with EU states are keen to ensure their teams are fully trained on handling Customs Duty. We’ve also heard of businesses holding stock in warehouses in Europe in case of a ‘Hard Brexit’, a strategy that is tying up a large proportion of their working capital. Other companies working with or trading in perishable goods are struggling with their supply chains and are worried about the impact of Brexit on transit times.
Companies looking to expand internationally in the short-term, hope they won’t be at a disadvantage. The questions they are asking are: will our brand be treated differently in the EU and will we be able to leverage off of our UK success? If we deal in multiple currencies, will we be fighting a losing battle?
Despite these concerns, Fast Track businesses are thriving because they are innovative, forward-thinking and look after their people. These types of businesses form what our New Economy campaign calls the economic engine of the UK. We are advocates of an economy that makes the most of Britain’s talents, skills and entrepreneurialism; an economy which is outward-looking and helps its home-grown businesses expand abroad.
Thank you to our BDO team, Gareth L Jones, Andrew McNamara, Fletcher Adamowicz, Mark Lamb, Laura Stuffins and Laura McNaughton for sharing their thoughts and to the leaders of the Fast Track 100 companies for taking to time to talk to us about their successes and their challenges. We hope the insights they have shared are helpful and informative.
Stuart Lisle is Senior Tax Partner at BDO.