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85,000 North East SMEs unaware of their utilities spending

New research reveals that whilst small business owners are concerned about the price of utilities, almost two thirds (63%) of SMEs in the North East, 85,204 businesses, do not know what they spend on electricity, gas and water as a percentage of their overheads.

The study, published by one of the UK’s leading energy and water consultancy, Utilitywise, which is headquartered in South Shields shows that only one in ten (15%) of the North East’s small business leaders can easily see how much electricity, gas and water their business is using and only a quarter (25%) are able to access energy consumption information.

The research highlights that more than half (53%) of small business owners delegate utilities purchasing and management to other staff, including their office manager. 31% of respondents reported that they look after utility suppliers themselves, yet, more than one in ten small business leaders (13%) admit they do not know who in their business is responsible for this important overhead.

This is despite the rising price of utilities remaining the main source of cost inflation for over half of all small businesses (53.8%).

When it comes to energy purchase and consumption the data shows a lack of understanding and engagement amongst small business owners in the North East.

Business owners review their personal domestic utilities provision more regularly than they review the supply to their business (31% versus 25% respectively who review this annually).

Worryingly, 19% of small business owners never actively review their utilities provision which equates to 25,697 businesses across the region that have never considered how they might get a better deal on gas, electricity or water.

When compared to other products and services such as broadband, recruitment agencies and stationery, utilities has the highest percentage of small businesses that report they ‘never review their provision’.

Moreover, 81% did not know the difference between a fixed and flexible energy contract.

Utilitywise’s Michael Dent, said: “Our study shows there is a lot of confusion about utilities amongst small businesses in the North East.

“Misinformation and misunderstanding means small businesses are suffering because they don’t know how to navigate the utilities markets nor have the levels of consumption necessary to negotiate better prices.

“Poor buying and management of utilities stops growth and damages businesses’ bottom lines.

“To tackle this, we have introduced the Utilitywise Energy Alliance, a new service that uses the collective buying power of thousands of small businesses to get the same competitive energy deals as larger companies.”

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