The accounting professional has historically been dominated traditionally five accounting firms (PriceWaterHouseCoopers, Deloitte, Ernest and Young and KPMG) before reduced to four when PriceWaterHouse merged with Coopers and Lybrand. These are the powerhouse of the accounting, auditing, taxation and business advisory services in the country and also globally.
Growth in the accounting industry is either organic (internally driven) or through mergers and acquisitions. It’s not easy to grow organically because most the services are similar in nature. It’s not easy to innovate in this space. All companies are doing similar projects, in the similar process and charging similar prices. What may set one apart from another is services, but even that will not result in a competitive gap that is sustainable. Ultimately it boils down to relationship management. The latter always being the preferred way of growing the brand.
Emerging accounting practices, once they show signs of growth, are at “risk” of being swallowed by these big practices. I say “risk” in inverted commas because the swallow (technically speaking termed merger” is always voluntary. The owners of emerging accounting practices allow themselves to be merged with big established fishes. The big eating the small.
Competing in this market is not easy. To be big you need to have big clients. Big clients prefer big accounting firms not small.
The history of SizweNtsalubaGobodo is entrenched in the focus and progression of its business leaders.
SizweNtsaluba VSP and Gobodo Incorporated merged in 2011 to form the largest black-owned and managed accounting firm and the fifth largest accounting firm in South Africa. The landmark merger combined more than 40 years of experience across various industries and redefined the landscape of the accounting sector.
The successful merger of the country’s two preeminent firms was strongly assisted not only by the visionary focus of its leadership, but also the individual histories of the firms which charted a path towards industry prominence.
SizweNtsaluba VSP traces its roots back to 1985 when the firm was established primarily as a business consultancy and advisory firm.
Gobodo Incorporated took root in 1996 as a group of Black chartered accountants under the leadership of Nonkululeko Gobodo, the first Black African female chartered accountant in South Africa. At that time, Gobodo Incorporated served as an audit and advisory practice working with parastatals and government departments.
The list of clients that SNG services include among others:
Standard Bank, Nedbank Limited, FirstRand Bank Limited, State Bank of India, SA Roadlink, MTN Treasury, South African Airways, South African Reserve Bank, Industrial Development Corporation (IDC), State Information Technology Agency (SITA), City Of Johannesburg
Underdog edge: SizweNtsalubaGobodo has been able to resist being merged by the traditional big four. The merger of SizweNtsaluba and Gobodo has created a big accounting practice.
In the startup revolution the big do not always eat the small but the fast always eat the slow.
Underdog on top: From humble beginnings as two startup accounting practices, SizweNtsalubaGobodo has merged and emerged to be one of the top five accounting practices in South Africa. SNG is now part of the big fish.