SMEs feel slighted by Energy suppliers

Ofgem recently completed a Harris-commissioned study, polling 90 SMEs and enquiring about their use of energy and their experience of the energy market. Although this segment of the market represents comparatively low revenues for the suppliers -notwithstanding that little revenue times many SMEs still represents a fair few bob – it is a sector they should heed, as some of these SMEs may one day become significant PLCs with proportionate clout.

And the current views are damming. Energy suppliers are perceived as undifferentiated, offering in essence a commodity. There are claims of profiteering, of little or no proactivity when it comes to contract renewal, rollover or issuing of renewal letters, and of insufficient transparency concerning bill management, tariff rates and contract terms.

The bill is often found to be difficult to understand. In general there is a feeling that suppliers should be more honest and proactive. The concept of backbilling is intensely disliked, being described as ‘unfair’ and ‘diabolical’. Conversely, overpayments, sometimes involving large sums of money, take a considerable amount of time to be repaid by some suppliers.

Auditel affiliates will not be surprised by these gripes, but comforted by the fact that they bring genuine help to these stranded SMEs, not just on the financial side but also with decrypting a series of unfathomable hieroglyphics and possibly even with managing emotions!

This survey should be bedside reading for the CEO of all energy suppliers.

Should Small Businesses have a Smart Energy Meter or not?

The big energy companies are doing their own individual things at present with regard to rolling out the new AMR (Automated Meter Reading), meters. Commonly referred to as “Smart Meters” the government sees these as enablers to a lower carbon, and therefore more sustainable future for all of us, as well as to greater competition and lower consumption, and therefore costs. They will also lower the costs for network operators (suppliers to you and me), as they will have fewer billing queries and complaints due to the existing confusion caused by estimated meter reads. Of course the cost of actually reading the meters will drop considerably. As consumers in the domestic market and the small & medium business sector (thanks to OFGEM the industry regulator), we will all benefit from accurate bills, and better information to help us manage our consumption down. We should hopefully get increased price competition from new and smaller market entrants. Finally we should see more sophisticated and appropriate tariffs, using the accurate data.

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How financial directors can regain power over rising raw material costs impacting their organisations’ profits.

The findings of the latest FT and The Economist Business Barometer research come as no surprise: over the coming months leaders foresee the biggest risks to their businesses to be rising costs of oil, commodities prices and interest rates. This prompts greater scrutiny of organisations’ profit margin and higher expectation of financial directors to perform in challenging times.

The rising material prices are putting ever-increasing pressure on the costs of bought-in goods and services, and at the same time, increasing interest rates have the potential to dampen sales demand. The outcome is a negative impact to their P&L and a reduction in earnings before interest and taxes.

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Backdated utility bills drive small UK firms up the wall

How would you feel if you received an energy bill dating back six years because your provider claimed it had undercharged you? That’s the predicament facing thousands of small businesses, according to a campaigning organisation.

The Association of Convenience Stores (ACS), which represents more than 33,500 local shops across the UK, wants energy regulator Ofgem to end a rule that allows energy companies to treat their business customers in this manner. At present, providers can only serve backdated bills for one year’s energy usage to domestic customers.

Consumer Focus says its helpline received nearly 2,000 calls last year from small businesses complaining they received unexpectedly large bills of this type. What is more, once firms have received an outstanding bill energy providers can demand immediate payment, plunging many companies into difficulty.

— Guardian News & Media Ltd

Click to read full article

Until Ofgem decide to make changes to this ruling many customers will continue to recieve these surprise backdated bills and demands for instant payment.

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Team Auditel take on the Great British Bike Ride – 350 miles in 5 days

Team Auditel and sponsors at the Auditel Supplier Exhibition 2011

The Great British Bike Ride in 2011 will be staged from Land’s End to Twickenham Stadium in early July. This five-day ride is designed for all cycling enthusiasts, sportsmen and women who want to take on a real challenge and at the same time, raise some much-appreciated funds for highly deserving charities.

Team Auditel, consisting of six intrepid Auditel consultants plus their Recruitment Director, will be taking part in this year’s gruelling ride. All six team members will be cycling the 350 miles from Land’s End to Twickenham Stadium over 5 days and, hopefully, raising at least £10,000 for Auditel’s chosen charity, Help for Heroes. With an average of 70 miles to cover on each day of the ride, Team Auditel started training in October last year and the team has already covered thousands of miles. Any donation small or large will be much appreciated and a step closer to their target.  Visit the Team Auditel – Just Giving page for more details .

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Lower the cost of doing business

Auditel help thousands of organisations across the UK to lower the cost of doing business by reducing financial waste and improving their bottom line profits.

“Success is what happens when preparation meets opportunity.”

Seneca, Roman Philosopher, 1st Century AD

Opportunity

It is estimated that in the UK today hundreds of thousands of organisations are paying over the odds for a wide range of business overheads.

Bearing in mind that for every pound of profit made you need to earn around four times that amount in sales, then lowering the cost of doing business becomes an even more appealing proposition

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7 days & 7 Tips for saving the small costs – Small Leaks can Sink a Big Ship

By now most companies will have cut the large costs i.e. new projects, staff etc that they needed to do to get them through the recession.

Managing Directors, Finance Directors and Owner Managers are now gearing themselves up for the recovery and although they’ll, of course, have a keen eye on the costs their main focus is likely to be increasing revenue and identifying new opportunities.

1) Energy Market Timing

There are many complicated areas in energy but the biggest saving, by far, is timing the market correctly. You can easily save some money by simply calling a few energy companies for quotes, but make sure you are comparing apples with apples e.g. are they using the same number of kilowatt hours per annum and make sure you are not jsut comapring the headline pence per kWh, remember to include all the elements of cost.

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Contract Cleaning: How Auditel reduced Daiichi-Sankyo’s costs by 28%

Daiichi-Sankyo, a global pharmaceutical company with offices just outside London in the UK, asked Auditel to review their contract cleaning expenditure in an effort to reduce their costs and boost their bottom line. With office space covering three floors of a dedicated building their expenses were significant.

Auditel first looked to ascertain what service they were currently buying and at what price. We also needed to check that they’d been invoiced correctly (the last 12 months invoices and the supplier contract helped to fill in much of this detail). These showed that a fixed monthly price was charged for a set number of hours cleaning. In addition there were ad hoc invoices for the supply of consumables such as toilet roll. Comparing these invoices to the contract prices showed that everything invoiced in the last twelve months had been done so correctly.

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Return of 12 month mobile contracts and other new telecoms measures

Yesterday saw the formal adoption by Ofcom, and coming into force of the Telecoms Reform Package, a Euro-wide set of measures designed to create additional competition within the telecoms market. These measure are effective as of today.

Return of 12 Month Contracts

Telecoms providers are now obliged to offer (the currently very rarely seen) 12 month contracts both to businesses and to consumers. This will be of particular interest to businesses with traditionally high staff turnover, such as consulting, recruitment, and similar industries. It makes sense that such organisations do not wish to be locked into long-term contracts for mobiles where some staff may only stay in the firm for one to two years. This will also make it easier for staff who leave their employers to keep their mobile numbers (as long as their employers are happy with this) – since they are less likely to encounter long-term and potentially expensive contractual obligations entered into by their employers.

In general, prices tend to fall in the telecoms industry and availability of long-term-only contracts tend to lock the customers away from competitive purchasing and getting lower prices, thus protecting the incumbent suppliers from having to offer better deals to all of their customer base. Indeed, Ofcom said in their statement: “Shorter contracts are likely to promote competition and enable consumers to switch providers more easily to benefit from better prices and services”.

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New OFCOM rules for Business

OFCOM (The Telecoms industry regulator) has announced some changes that affect business customers:

Shorter Contracts – The maximum contract length for new contracts is now 24 months and a potential customer MUST be offered a 12 month option.  The aim is to promote competition and ease of switching.  However it doesn’t appear to state what notice periods are allowable.  We’ve recently seen one telecoms company that sold a 12 month contract but with a 36 month notice period i.e. in effect a 36 month contract.  Not exactly fair and a perfect example of sharp practices in the industry and why you should always read the T&C’s no matter how long, how boring or how much you trust the salesman (alternatively let us read the T&C’s for you!)

Porting Mobile Numbers to take a maximum of 1 working day – The penalty OFCOM has suggested is compensation of at least the daily line rental rate however providers are free to design their own compensation schemes.

Emergency SMS – Under new European regulations, disabled consumers should have the same access to emergency services as other consumers. The emergency SMS scheme, allows registered users to text 999 in an emergency instead of making a phone call. The scheme currently has around 14,500 registered users and predominantly used by hearing and speech-impaired people.  Mobile providers are now required to make the scheme available on a permanent basis for hearing and speech-impaired consumers.  So if you have any hearing or visually impaired staff with mobiles you need to ensure that they have access to this service.

Read the full OFCOM press release