The ‘Top 5 tips for reducing energy bills’ is brought to you in association with Make It Cheaper.

Make It Cheaper is the UK’s leading business price comparison and switching service, handling over 2,000 enquiries a week. It provides its customers with impartial, comprehensive and free information about overheads such as business electricity and business gas helping you to switch suppliers and making sure you are not caught out by the small print.

What many businesses are waking up to is that there is no such thing as customer loyalty with energy suppliers and by staying with one company from one year to the next you’ll end up paying higher rates. With 11,000 different business energy tariffs ranging threefold in price switching once a year is the only way to stick on the better rates. Here’s are some tips to help you.

Establish Contract Status

• Call your supplier to clarify your contract status, the unit price you’re paying and the date of your next renewal period. It’s actually better for a business to be in a contract than not. ‘Out-of-Contract’ rates are the highest rates you will ever pay. So, for example, if you’ve just taken over new premises but not contacted the suppliers, you will be clocking up a massive account.

Shop Around

• Don’t accept a new contract with your incumbent supplier until you’ve compared prices. If you don’t have time to call your existing supplier or potential new suppliers try a business price comparison service who can tell you immediately if your rates are competitive and if not, do the legwork of finding out which is the best deal for your business (based on postcode, credit score and consumption).

Check Renewal Dates

• Once on your on a contract, make a note of your renewal dates and what notice you need to give as many suppliers make it difficult to switch towards the end of a contract. Each supplier has different rules with renewal ‘windows’ closing long before the end date. Miss your window and you’ll automatically be ‘rolled over’ for a year on uncompetitive rates.

Serve Notice Regardless

• Not everyone has the time or patience to keep a track of when their contact is up for review. The best way to get around this is to send a notice letter irrespective of how long your contact has to run. You cannot be cut-off for doing this and given that your current supplier knows your switching intentions, they will be more inclined to offer you competitive rates at your renewal.

Sign-up For Help

• For those in any doubt about your existing contract(s) or just looking for an easy solution, Make It Cheaper offers a free contract checking service that deals with suppliers on your behalf and contacts you with the best rates available when it’s time to switch.

For more information please use our contact form and speak to Make It Cheaper today.

The problems micro-businesses face are compounded by a ‘protection gap’ with confusion about who takes lead responsibility – Ofgem or the Office of Fair Trading – for making sure this part of the market works well. To boost consumer protection in this sector, Consumer Focus would like to see Ofgem take further action. The first step must include clear standards and genuine buy-in from the brokers and energy companies, with the backstop of stronger regulation if improvements aren’t delivered.

Brokers are important because they can guide a busy business through the range of complex tariffs. Often, it will be a direct approach from a broker that makes a micro-business realise they could get a better deal. But the report highlights some serious problems. One of the most common is that brokers often aren’t clear about their role or don’t explicitly say that they do not have to search the whole market for the best deal. This leads to small businesses assuming they are dealing with impartial advisers rather than third parties who are often paid commission by energy companies.

Other issues are that some brokers:

• misrepresent offers from suppliers
• aren’t up-front about their fees and offer poor quality advice.
• aren’t clear how much a commission they receive and who pays it.
• there is also confusion about whether brokers are paid commission by a limited number of energy companies, or will advise on all suppliers and products.

Consumer Focus energy expert, Andrew Hallett, said: “Small businesses need to know they’re getting sound advice from brokers otherwise there is little point in their role.  When micro- businesses are under more pressure than ever before, it’s vital that they can be confident they’re getting the energy deal that’s best for them.

“Confidence in the energy market is becoming even more pressing as the Government wants small businesses to go green with Green Deal loans to improve energy efficiency. Small businesses need strengthened consumer protection.”

There are about 1.8 million business electricity customers on the UK mainland that are classed as neither residential nor heavy industrial. Of theses, hotels and B&Bs are the most cost-conscious when it comes to their business energy bills. In fact, providers of accommodation are three-and-a-half times more likely than the average business to switch supplier, having topped a list of 100,000 companies that have shopped around throughout 2009 to compare business electricity and/or business gas prices.

The list, worked out proportionately for each business type, also ranks pubs, bars and restaurants in the top three, just after wholesale premises. Other savvy business types include: manufacturers, post offices, printers and membership/sports organisations. The latter group includes clubs such as British Legions, Scout groups, community centres and other not-for profit organisations – all treated as business premises in the eyes of the energy suppliers.

Rank              Business Type                   Switching Likelihood

1                      Hotels / B&Bs                                 x3.5

2                      Wholesalers                                   x3.3

3                      Pubs, Bars & Restaurants            x2.7

4=                   Manufacturers                                 x2.6

4=                   Post Offices                                      x2.6

6                      Printers                                             x2.5

7                      Membership & Sports                    x2.3

8                      Engineering                                     x1.8

9                      Churches                                         x1.7

10=                 Hairdressers                                     x1.6

10=                 Dry Cleaners                                    x1.6

Further evidence suggests that businesses that have recently changed hands are also among the most common types to switch. A ‘change of tenancy’ usually means the energy supplier to the previous occupier will charge the new business out-of-contract, or ‘deemed’, rates which are significantly higher than average.

Here’s how one typical hospitality business has managed to save £3,000 this year following its discovery that it was being charged out-of-contract for its business electricity and business gas.

‘The George’ is a traditional coaching inn set in the heart of the village of Silsoe, Bedfordshire, close to places of interest such as Woburn and convenient for Luton Airport. Accommodation is available in the form of six letting rooms on a bed and breakfast basis. Owner Sue Goldsmith’s New Year resolution was to do something about lowering her business energy bills which had crept up to a total of £10,000 for electricity and gas combined.

Sue was being charged out-of-contact by both her gas and electricity suppliers and that these rates – 16.5p/unit for business electricity and 3.5p/unit for business gas – were much higher than rates normally available. Sue went for in-contract rates of 9.8p/unit for electricity and 2.5p/unit for gas. Because Sue was not in an existing contract with her suppliers she was able to immediately accept. Based on its energy consumption this year, The George has saved at least £2,000 on electricity and £1,000 on gas, bringing the annual energy bill down to a much more manageable £7,000.

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