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Finding and developing new local suppliers can be a challenge for any business, particularly for small and medium enterprises (SMEs). However, this process is crucial for a business to grow and expand its reach. According to Kyle Ballard, head of accelerators at BMA, a business accelerator programme can be a valuable tool to help businesses find and develop their future local suppliers.
“If designed using a tested methodology, a Business Accelerator programme should be able to find and develop your future, local suppliers, whilst simultaneously optimising B-BBEE outcomes. It must be able to identify high potential, committed suppliers, connect them with customers and unlock clear, scalable commercial opportunities through robust upgrading interventions,” Ballard said.
There are several key differentiators that a leading industrial enterprise should consider when selecting a business accelerator programme, according to Ballard.
The first is that the accelerator should seek to understand the customer’s needs, and then deliver on those requirements.
This approach is distinct from other SME development programmes that seek to identify what is deemed to be a “good business” without clarity on what the ultimate customer wants.
The accelerator should also be structured to identify high-quality SMEs who are prepared to demonstrate their potential to customers, rather than simply identifying SMEs needing support. The programme should efficiently screen a large volume of applicants, identify high-potential candidates, and support them to put their best foot forward. The customers should ultimately select the SMEs.
A business accelerator should also customise upgrading based on the nature of the identified commercial opportunity, bridging the often-challenging gap between high-potential enterprises and purchase orders being placed. The programme should maximise B-BBEE spend within the value chain, directing B-BBEE spend towards capacitating and aligning a lead enterprise’s value chain to directly support its growth strategy.
One example of a successful business accelerator programme is the Durban Chemicals Cluster (DCC) Accelerator, which since 2019 has successfully unlocked 33 new commercial commitments between leading corporates and SMEs, creating over 150 new jobs and adding up to more than R24.5 million in new revenue.
Another example is the KwaZulu-Natal Clothing & Textile Custer Accelerator, which has unlocked 14 new commercial commitments between leading retailers in the local clothing and textile sector, resulting in over R10.4 million in new revenue and creating over 120 new jobs.
“Companies operating in South Africa’s chemical sector are always on the lookout for high potential SMMEs to work with, and the DCC Accelerator makes it so easy to identify potential partners. We’ve met some high-calibre talent with brilliant business cases through the Accelerator,” said Rudi van Niekerk, regional general manager of H&R Africa.
“It’s been an unbelievable experience to see the calibre of local supply, the potential opportunities, and how Mr Price can partner with these SMEs for future growth and reach our localisation targets,” shared Paulina Urban, sourcing director at Mr Price Sport.
- Lead enterprises and other stakeholders interested in partnering with the Accelerator can visit https://bmanalysts.com/our-services/accelerators/ or contact Accelerators@bmanalysts.com for more information.