MTN Xlerator to boost local supply chains for growth

MTN South Africa has taken a significant step towards bolstering the nation’s supply chains, fueling economic growth, and promoting inclusivity with the launch of its Enterprise and Supplier Development (ESD) programme, MTN Xlerator. This aligns with the company’s commitment to supporting black-owned enterprises and is a key pillar of its Ambition 2025 strategy.

In 2021, the company committed over R220 million to various ESD initiatives, along with nearly R100 million dedicated to skills development. Over the past five years, MTN’s total measured procurement spend has surged from approximately R26 billion to more than R44 billion. Impressively, R17 billion of that spending was directed toward entities that are at least 30% black women-owned during the 2022 financial year.

Moreover, MTN’s commitment to supplier development, enterprise development, and socio-economic development initiatives in 2022 translated into investments of R189 million, R152 million, and R81 million, respectively.

Charles Molapisi, CEO of MTN SA, emphasised the significance of these achievements while acknowledging the importance of SMMEs in driving the economy and job creation. He stated, “We are exceptionally proud of these achievements; however, we know that if we are to create shared value consistently and sustainably in SA, we must adapt and become more intentional at developing and increasing access to the market for SMMEs, given the pivotal role they play in the economy and creation of jobs.”

The newly unveiled MTN Xlerator programme sets ambitious targets for procurement spending and local supplier development. The plan includes procuring from 50 black-owned suppliers (up from 13 in 2021) with contracts valued at R50 million or more.

It also aims to incorporate 140 active qualifying small enterprises into MTN SA’s supply chain, up from the current 70, and increase the number of active exempted micro enterprises from 66 to 120. Additionally, there is a commitment to expand the roster of black-owned women suppliers from 65 to 120.

Molapisi explained the programme’s broader goals, stating, “At MTN, we’re significantly ramping up procurement and development spending into key areas, where outcomes can be accelerated and maximised. Supply chain resilience will be enhanced by increasing supplier diversity and strength, collaboration, and the ability to adapt to the ever-changing operating environment and challenging economic conditions.”

Crucially, MTN SA aims to reduce barriers to entry into the telecommunications and technology sectors, historically challenging due to high capital investment requirements. Molapisi highlighted that the program is facilitating the establishment of more black-owned network operators in South Africa, a pivotal milestone for the industry.

MTN’s Xlerator programme offers support through various means to foster growth and help participants meet program requirements. Short-term support includes working capital funding, early payments, and working capital loans, while long-term assistance encompasses low-interest loans, asset finance, and guarantees.

To drive these initiatives, MTN has partnered with the likes of Nedbank, Absa, Bridgement, Mamor Capital, Payabill, and Tysys Capital Group, focusing on funding product development, direct funding and co-funding, loan support through guarantees, business plan evaluation, credit assessment, business development, and training and development.

Training and development will be tailored to individual participant needs, with a focus on certified technical, health and safety, and project management training, along with business development support to foster commercial growth.

Molapisi summarised the programme’s vision, stating, “Through MTN Xlerator, we are transitioning our supply chain strategy from transactional to values-driven, with ESD at its epicenter. The program aims to be a beacon of economic transformation, where budding entrepreneurs and suppliers are nurtured, while fostering competitive markets that catalyse job creation and establish self-reliant communities.”

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