When it Comes to Energy, SMEs Need Numerous Options


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Phil Scholes, SME Sales & Marketing Director at npower

Choice is important to business success. The fewer the options, the more restricted businesses are in deciding when and how they grow. One of the problems with recessive economies is that they limit the options available to businesses. Lenders become less willing to lend and investors to invest. Suppliers retrench and shore up their own organisational defences, while opportunities to move into new markets dry up.

The good news for Small Medium Sized Enterprises (SME)s in the UK is that they are gradually beginning to emerge from recession and are continuing to recover. As growth stabilises the benefits trickle down through the economy, and we see a welcome return of choice to the business landscape. In fact, in an economy which is still fragile, businesses will need to rely on choice more than ever if they are to gain competitive advantage and grow cost effectively.

We can see this in the utilities sector. In the past, the way that utilities were provided to SMEs largely precluded choice. They were delivered as a ‘one-size-fits-all’ service, regardless of where in the growth trajectory a business was, or what specific needs that business might have had. Utilities were a cost centre – nothing more.

By delivering an element of choice however, utility services can elevate themselves from being just a cost centre to being a strategic tool.

Take the energy sector. Instead of providing one plan to SME businesses, energy providers should look to deliver a set of differentiated products to customers, with each designed for a particular type of business or for a specific stage in a business’ growth.

Take a start-up business, for example. Start-ups may experience rapid growth, which requires them to move into larger facilities after just a short time. Traditionally however, the energy plan would be restrictive of this, as businesses will often be tied into a plan for a set period of time. In this case a more flexible plan that allows the company to close it, or swap it for another at short notice would be the most suitable. It would allow them, in short, to keep their options open.

Alternatively, a more established SME might know exactly where it is going to be in a few years, but requires budget certainty to help it get there. In this case, flexibility of the plan becomes secondary to a fixed, long-term, transparent rate; one that allows them to budget effectively well into the future.

Different businesses will have very different requirements when it comes to energy plans. The onus is on energy providers to deliver the options they need. It is a win-win scenario. Customers will benefit by having a plan more tailored to their needs while the utility itself benefits from increased customer satisfaction. SME choice in which energy plan they use will help growth and play an important part in the continued recovery of the UK economy.

Find out about the choice of business energy plans we offer and see what else we’re doing to make business energy better.

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