Vegan Accountants, based in East London, serves the unique needs of ethical and plant-based businesses in the UK, having pivoted around five years ago to a purely vegan business model when partner Keith Lesser became increasingly focused on the vegan lifestyle, wanting to work with mission-aligned founders in the space.
Recognising the distinct financial and ethical considerations of vegan businesses, Vegan Accountants offers a comprehensive suite of services tailored to support businesses in navigating the complex landscape of sustainability-focused finance. With a commitment to promoting ethical business practices, the firm offers expertise in tax, accounting, and financial planning to empower clients ranging from startups to established enterprises.
What advice can you give to businesses looking to incorporate ethical practices into their financial management?
To be ethical is to be kind, there is a difference between kind and nice. Being nice is allowing business and performance to fall below quality standards. Being kind is actually to perform and to hold the team to account. This is a win-win and creates sustainable long-term success. Being vegan doesn’t mean being unprofitable or allowing poor standards, quite the opposite in my view, ethics and quality have to go together. Ethics alone is not enough.
“Being vegan doesn’t mean being unprofitable or allowing poor standards”
We would rather that ethical businesses are successful. Quickbooks can enable this quality by allowing analysis by customer, by employee or by product. The P&L by “class” feature for example is a way for the reporting to be split out and give meaningful data. A standard Profit and Loss does not give enough interrogation or decision support and this is imperative for organisations with multiple employees. Book-keeping is the cornerstone of this and every transaction must be categorised in this way and fall in line with the company strategy and objectives.
What strategies do you recommend for businesses to analyze and improve the profitability of their service lines? How can businesses identify which of their services are most and least profitable?
In terms of strategy, it is easier to do more work with existing customers than win brand new customers. Existing relationships are underutilized; companies put too much effort into new customers when, in fact, the existing customers can be their champions and need to be retained.
Deeper relationships are required and the vegan scene is the perfect environment to achieve this, we are actually quite lucky with vegan business that we can forge these close bonds with customers, suppliers and employees, it gives us a better chance to achieve success due to our values, compatibility and common interest. Analysis can be done on what customers buy right now and what products or services you provide that they are not buying. For example, one can ask, what is the profile or size of the customer, and how do they benchmark against similar size customers in terms of their spend with your organisation?
How can businesses leverage advanced analytics to better forecast future trends and adapt their strategies?
Partly a simple answer: put prices up. I am speaking to too many clients who just aren’t putting their prices up and are not articulating this to customers. Supplier costs are up, wages are up. If a business has not put its prices up and does not do this at least annually, it will not ultimately be able to achieve its potential.
“…companies put too much effort into new customers when, in fact, the existing customers can be their champions and need to be retained”
Forecasting tools in general are not essential, it depends on what the objective is. Is it to share with an investor? Or a bank? Is it for a sale? How concrete is the forecast? How mature is the business? The problem with forecasts partly is how quickly they go out of date. Yes, cash flow requires planning, but how far in advance and what degree of confidence is there? How many contracts are signed and what is the pipeline? What decisions does a forecast help with? Before jumping into data analysis, the objective must be considered first and the exercise tailored to this. Forecasting softwares in general I do not recommend and we usually build bespoke spreadsheets based on client requirements.
Simple is best and any forecast needs to be aligned to the chart of accounts in QuickBooks or Xero. I see too many forecasts in a completely different format to the historic actuals and is too confusing, this achieves nothing except extra work and cost. The actuals and history and the forecast have to present the same data. The bridge between the two needs to be automated and seamless.
Why should businesses consider partnering with ethical banks like Starling, and what are the potential benefits? How can an ethical banking partnership enhance administrative efficiency and client success?
Starling is a win-win. As in the press, Barclays has lost high-profile customers like Cambridge and Leeds University. This is hopefully an avalanche and a tipping point, individuals and companies feel powerless but we can choose who we bank with. The majority of high street banks provide awful service and are not interested in small businesses below £1million. Starling is a great product, free banking and ethical. Triodos does not provide business accounts. There are other more neutral banks but the top 6 Barclays, HSBC, Lloyds, Santander, RBS, and Natwest must be avoided.
What key strategies would you advise for businesses aiming to scale their operations and increase turnover?
Build a team! Systemise! On day one a founder may do everything in a startup. Capture processes via a system such as Monday.com and then delegate and hand over the tasks to a team. Start with freelance and build up if you cannot afford an employee. You need to be able to hire people below your skill level or with different skills at a lower rate than your worth so you can focus on more profitable activities. Get a quality accountant involved at the beginning, and get as much quality advice as possible. Avoid Google and Dave down the pub. Focus on quality customers.
How can delegation and team empowerment contribute to a business’s growth and sustainability?
We cannot do everything alone and, actually, building a vegan team is a great way to ensure retention and compatibility with values. I believe in operating an inclusive rather than an exclusive vegan model as we are better to have the debate outside the tent if we want the tent to get bigger. Vegan to vegan is fine but this will not build the movement. A business owner’s ultimate job is to make themselves redundant. Ultimately, however, they may have different objectives and enjoy work and wish to continue forever more so does very much depends on the individual and circumstances.
What financial due diligence advice can be learned from networking events and stories of failed start-ups?
The biggest one I hear is the owner going rogue, taking on too many loans, treating their company like a piggy bank, and not doing what the accountant has advised/instructed.
How can businesses benefit from seeking external perspectives and embracing failures as learning opportunities?
I have touched on a few but get the pricing right, build relationships with customers, focus on existing customers not just new ones, work with ethical suppliers/customers/colleagues, be inclusive and have a dialogue externally to the vegan movement, create separation between an individual and a company and put best practice in like monthly budgeting for tax liabilities. Pay all VAT immediately.
The worst is chasing your tail and spending beyond your means. The other side of it is successful businesses and individuals not getting advice so then whilst successful minimising their success and deflating their potential outcome by 30%. They might need that 30% buffer on a rainy day so quality business and tax advice is imperative. Planning like pensions and electric cars can be a tremendous way to become tax efficient and achieve substantial savings.
