‘As SMEs grow accounting solutions are apt to maintain accountability’
Nikki Summers, Director for Sage One East-West Africa, spoke to a select group of journalists about Sage One, an accounting solution that enables Nigerian small and medium businesses with access to laptops, smartphones and internet to take personal control of their accounting processes. BusinessDay’s FRANK ELEANYA was there.
How long have you been in Nigeria and what has been the feedback from producers?
We launched this product in Nigeria in January this year. The feedback that we have received has been absolutely phenomenal. Once a customer starts using it, they just love it. We already have some testimonials. I had a meeting with one of our accountant advisors and she was thrilled about not needing to be in the office to work. She can access everything wherever she is. Sage One has in-product communication so if the customer does an incorrect wrong entry, they can send a note to the accountant saying “Please checks this for me.” Because it is a cloud-based application, it all happens in real-time and there is only one version of the truth.
Whats different about Sage One Accounting
Sage One is our online accounting software, accessible anywhere you have an Internet connection and a computer or a smart device. The future is mobile and we are giving our customers the power to control their businesses from the palm of their hand. We think this is an exciting product for Nigeria, especially given how the slumping oil price has affected the economy and how mobile the country’s entrepreneurs are.
Nigeria must become less dependent on oil revenues, and SMEs have an important and growing role to play in this regard. They are already contributing a substantial amount to the country’s GDP as well as creating employment. As the SME base grows, so does the tax base. It is these entrepreneurs who are the drivers of prosperity and it’s our privilege and honour to serve them with solutions like Sage One.
Sage has more than 5 years’ experience in the online accounting and payroll space, with Sage Pastel My Business having been launched in 2009 in South Africa. This was later complimented by a payroll component with the arrival of Sage VIP Liquid Payroll and Sage Pastel My Payroll Online. Sage then re-launched Sage One in 2014.We recently started to focus on East and West Africa. One of the reasons for our delay in getting into the market was because we had concerns about internet connectivity. Though we have challenges around internet connectivity, access becoming less and less a problem across the globe. The time is right to bring the application to West Africa.
With Sage One, we enable our customers to focus on their business. SMEs spend dozens of hours a week on administrative tasks, when they should be focusing on the core business. The reason for this is that they do so much manual work – invoicing, doing tax calculations and so forth. Sage One allows them to automate this work and do it wherever they are. If they have Internet access, they can get on with their work.
Many businesses fail in their second year of operation due to lack of insight into their business. They start running into operational trouble due to cash flow issues. Many small businesses have paper expenses and invoices, sitting in a box in the office. Perhaps they will capture the numbers and try running them on Excel, but that generally does not work. We give businesses the ability to record and report on their finances so they always know what is going on.
Another challenge is that entrepreneurs need funding to start growing their business, but banks are not willing to give them loans because they cannot guarantee that they are going to pay back. One reason that banks decline loans is that businesses don’t have their financial records in order. We help our customers keep their finances tidy.
These are business challenges that smaller companies face around the world. We developed Sage One to address the needs of small and start-up companies for an easy and affordable accounting solution.
What do Nigerians stand to gain from Sage One compared to other solutions?
Sage One is designed for the ordinary person on the street who may not have financial training or an accounting qualification. If you look at the application, you will see that we do not talk in accounting terms, but in everyday language anyone can understand. It is really simple to use. We also back that up with resources like webinars and videos so that our customers can access help and support when they need it.
Another differentiator is affordability. Sage One costs just N2, 000 a month for one company and two users. It is so easy to use and cost-effective that we have already seen great uptake in Nigeria, where 250 small companies are using it already. So, that’s from the point of view of the small business. But Sage One also makes life easy for accountants.
SMEs need an accountant, but they cannot afford an accountant full time or an auditing firm. Sage One connects our customers to accountants and partners with real time and intuitive information about their business. The accountant can work for the business part-time and see their books online where he or she is.
You said the product has used in the South African market, to what extent was the success and were there lessons you learnt?
We have close to 40,000 customers using this product, representing significant market share.
Were customers concerned about putting their financial data online, in the cloud?
Because we deal with financial data, we are aware of the fact that we need to ensure that we apply the best security measures. We spent a great deal of time educating our market in South Africa about how we keep their data safe as well as how they can safeguard their financial information.
One risk lies with the people who use the software and have responsibility for the passwords. We insist on encrypted passwords, even though some people protest. Our development team is always looking into the system to make security even tighter because we understand that we are dealing with companies’ most sensitive financial data.
We will never compromise your financial data. When you sign up for the software, we stipulate that the data is yours. If you no longer want to use the software, we give you the opportunity to export all your data. We are not going to force you to keep your data with us.
What happens when a company outgrows Sage One?
Since we launched the product in South Africa, there have been a lot of developments. We have added additional features such as multi-currency, and we are looking at some other new features. But once a company has started using the software, we want to have that customer for life. We want to be able to start with you when you are a start-up and if you outgrow that product, we will be able to go to the next level and to the next level.
We are one of the software providers that can truly say we have got a solution from start-up to enterprise. The question we often get is, “Will I outgrow Sage One?” It depends on your business. For instance, if you are starting and you in distribution, you may never outgrow Sage One because the processes in your company are simple. But if assuming you were in distribution and now you are into manufacturing, we can look at a business management solution such as Sage 300 or Sage X3.