Accountants have a critical role to play in supporting economic growth in South Africa, and particularly in enabling the success of South African SMMEs.
In 2021, FNB collaborated with Xero and Edge Growth to deliver a first-of-its-kind developmental initiative aimed at supporting and empowering black-owned accounting practices that support the SME market. Accountants who begin their own practices are typically well versed in the technical knowledge that the industry requires but may not have built a firm foundation in all the disciplines necessary for running a sustainable business: sales and marketing, pricing, and packaging of services, digital transformation and the like.
Following the success of the pilot programme, with participating accounting practices experiencing a collective 34% rise in revenue and 700% growth in profit, FNB and Xero launched the second cohort of the programme in 2023.
Heather Lowe, SME Development Head at FNB, said “This programme is evolving into one which effectively correlates with the FNB enterprise and supplier development philosophy, which seeks to transform enterprises or SMEs in untransformed industries in a meaningful way. Key to this success has been the depth and effectiveness of ecosystem collaboration at an industry level.”
Cohort 2 success
The second cohort proudly welcomed fourteen ambitious participants and recorded commendable successes in achieving its objectives, which were to support the digital transformation of accounting practices to support operational efficiency; to capacitate SMEs with practice building skills, leadership, and planning principles training to help businesses deliver high-quality accounting advisory and compliance services to SME clients; and to provide practice-management skills essential for ensuring the operational continuity and scalability of firms.
Participating practices in the second cohort recorded:
- An average weighted revenue growth rate of 18%
- An average weighted profit growth rate of 64%
- Growth in full-time jobs of 38%
- Business maturity index (BMI) growth from 53% to 81%
In total, over 11 months, cohort 2 saw delivery of:
- 74 specialist projects – encompassing a diverse range of initiatives including website design, financial management, branding, and HR policy reviews.
- Nine online bootcamps covering various disciplines.
- 1 694 mentorship hours
- 28 advisory board sessions and fireside sessions
Lotlotlo Tax case study
Lotlotlo Tax was founded by Yvette Modisane to provide specialist tax and accounting services to individuals and businesses. When Lotlotlo joined the FNB Xero Accounting Programme the business had been operational for two years and lacked clear direction and a strategy for growth. Following an initial assessment, several gaps, including a lack of marketing budget and plans, were identified. A strategic plan was developed which saw Lotlotlo’s branding redesigned, and a marketing toolbox created. Lotlotlo’s pricing model was updated, and its BMI grew by a staggering 62% over the course of the programme. As Yvette reported: “The programme has been such an eye opener. My business mentor has provided me with valuable insight and guidance that I will cherish for a very long time.”
Cohort 3 launched to bolster industry transformation.
Given the success of the first two cohorts, FNB, Xero and Edge have chosen to open a third cohort for applications.
Colin Timmis, Xero’s South African Country Manager, explains: “We saw a huge benefit in the first two rounds of the programme in connecting participants with experienced accountants and business owners. New accountants don’t typically have established industry networks and access to older accountants with industry experience. By establishing these connections we’re building a community of knowledge and experience that has been transformational and very rewarding. It’s been a valuable first step in creating an environment which operates as a long-term support and capacity-building network.”
Apply for the FNB Xero Accounting Programme
Take your practice to the next level with the FNB Xero Accounting Programme 2024–25, supported by Edge Growth. Applications will open today, [28 August 2024] and will close on [27 September 2024].
To apply, please visit the Edge Growth Incubator Portal page @fnbxero3 – Incubator Portal
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