If you run a small business, read this guide to find out how you can save on your energy costs
Energy bills can be a major drain on any small business. Yet SME owners often overlook the fact that, just as with their home energy, switching supplier and tariff can be a quick way to reduce spending and lower overheads.
It’s worth noting that business energy tariffs tend to vary a lot more than domestic deals, and there is a lot more room for negotiation in some instances. With that in mind, let us introduce you to the best practices for finding the right business energy deal for you.
Why should you switch?
An investigation by the Competition and Markets Authority found that as many as 40% of businesses haven’t switched their energy supplier in the last five years. And an astonishing 39% have never switched at all! But depending on the size of your business, the savings achievable through switching can be huge.
On average, SMEs spend more than £5,000 on electricity and £4,000 on gas per year currently. If you think that your own energy costs may be higher than necessary, start by familiarising yourself with the different aspects of your current bills – including your unit rates and standing charge. This is important because your estimated annual costs may not give a truly accurate picture of what you should be paying.
How do you find the best price?
Comparing energy prices online with our comparison tool is the quickest and easiest way to explore a huge number of tariffs all in one place. It can give you a wider picture of the kind of prices you should be expecting to pay, while also highlighting any specific providers which you feel would suit your needs.
One of the key factors involved in getting the best business energy deal is to haggle. Ofgem rules make haggling over domestic energy deals impossible, but business energy deals can be tailored to suit your needs, so don’t be afraid to state exactly what you’re looking for.
The larger your business the more you can potentially gain from getting a tailored deal. That’s why we typically recommend that for those enterprises spending over £5,000 a year on energy, it is best to speak to book a call with one of our energy traders.
Can you get a fixed tariff?
If you are looking to fix yourself into a tariff for an extended period of time then many suppliers offer deals ranging from 1–3 years, although they can extend to 5 years in some cases. Longer fixed terms tend to be more expensive, but they can also protect you from future price rises – at least in terms of unit costs (remember that standing charges won’t be fixed here).
With so many different fixed and variable deals to choose from, speaking to an energy broker can be beneficial in helping you to secure the right contract.
What about a dual fuel tariff?
Unlike with domestic energy, dual fuel tariffs aren’t generally an option when it comes to business energy. You don’t tend to get tariffs which cover both electricity and gas, meaning you’ll need to look for separate quotes. So if you choose the same supplier for both services, you should ask whether you can get a little extra discount because of this.
If you secure your energy supply with The Energy Check, we’ll always work hard to negotiate a better rate for you.
What should you watch out for?
There are several things you should know when switching your business energy:
- There isn’t usually a cooling off period after you sign a contract, so make sure you’re completely happy with your new deal before you do.
- Choosing a business energy tariff means entering a contract, and you probably won’t be able to switch until that contract ends. So make sure it suits you in the long term.
- Many deals will automatically renew after a certain period, so make sure you know when your contract is coming to an end so you can start hunting around and comparing prices elsewhere.
What if you work from home?
If you don’t work in a business premises, you probably won’t be able to get a business tariff. That is, unless a large portion of your energy use is for your business, usually around 50%.
If not, try switching your domestic energy provider instead and hunting down a better deal.
If you want to find a better energy deal for your business, start comparing with The Energy Check today. Click here to use our switching services and get an instant quote, or contact our team by calling 0191 691 18 02.