If you run a small to medium sized business then you probably already know that energy bills make up a major expense. Electricity and gas are reckoned to cost the average SME £2,500 and £3,200 respectively each year. And the total energy bill for SMEs in the UK has been calculated at over £3.5 billion.
Your energy bill is dependent on factors like how much heating you use at your business premises, for how long you keep computers running, and whether you have specific machinery that needs to be powered throughout the working day.
But with energy prices constantly on the rise getting the best deal possible for your business is becoming ever more important. Wholesale energy costs are rising worldwide – and the energy suppliers will always pass on those costs to you, the consumer. So you need to be smart when you select your energy supplier to get the right deal for your business.
As domestic consumers looking to heat our homes we’ve become accustomed to shopping around for the best deal, rather than simply accepting the deal offered by our existing provider. But businesses in the UK have been strangely reluctant to push hard to find the best energy deal going.
When the Competition and Markets Authority (CMA) did research into the energy habits of SMEs they found many businesses simply accepted a default tariff that hadn’t been negotiated. Their report, published in 2015, revealed that 39% of SMEs had never thought about switching their energy supplier and were almost certainly overpaying for their gas and electricity.
It seems many businesses don’t trust the market or believe suppliers will be willing to offer better deals than their current rates. Or small firms simply don’t have the time to pursue a new deal.
Something to be remembered when thinking about your energy supplier is that loyalty to a particular supplier does not earn you any rewards. It’s a common myth that staying long-term with a supplier will earn you lower tariffs and better deals. This almost never turns out to be true.
So how do you ensure you get the best rates for your firm? Switching your provider has been proved by researchers to deliver major savings for businesses. Market research from Love Energy Savings has shown that changing your supplier can save an average of 40% on your energy bill.
That’s money saved that you can invest elsewhere in your business to push forward growth. You can use it for marketing, new stock, hiring new staff or suchlike – the important point is that switching your supplier can unlock the way to major savings for your business.