electricity4business Announces That Electricity Price Hikes Hurt Loyal Business Customers

Share Article

When it comes to extending supply agreements business customers are getting a raw deal from their electricity suppliers. Instead of being rewarded for staying with their supplier they pay up to 25% more than new customers of the same supplier. For the average business this is about 600 pounds a year more.

These new customer only pricing policies are shocking. There isn’t any reason why an existing customer should be offered a worse price than new customers. After all it costs the supplier more money to take on a new customer.

When it comes to extending supply agreements business customers are getting a raw deal from their electricity suppliers. Instead of being rewarded for staying with their supplier they pay up to 25% more than new customers of the same supplier. For the average business this is about 600 pounds a year more.

electricity4business says, “This is on top of huge price hikes of up to 140%. At a time when energy costs for businesses are spiralling out of control, the least firms should deserve is to be treated fairly.”

Gone are the days when loyal customers were valued and given extra bonuses for their loyalty. The retreat from this practice began when companies operating in consumer markets and eager to attract new customers believed that offering reduced rates to new customers alone would boost their quest for market share.

The biggest culprits were banks, insurance companies, telecoms and essential utilities. They all offered exceptional introductory rates in the hope that customers, usually tied in with direct debit accounts, and would fail to notice the increases when it came to renewal. And here we had the inception of a new market model which is now today’s norm.

The more loyal customers are the more they pay.

But for those who dared to question the renewal rates or God forbid, shopped around, there were the infamous ‘save tools’. Suddenly there was a reason why the incumbent service provider could match the quotation received from a competitor.

Now it was always believed that companies would never get away with such practices in the business to business sector. Businesses would see through these dubious practices and would use the introductory offers to cut their costs, switching to a new introductory offer the following year.

Well those who thought this were wrong.

First the banks began to offer low or zero cost banking to new customers with no significant exodus after the first year. The rest followed in their wake culminating in deals from the previously ‘one price fits all’ utilities.

And to their delight they discovered the real benefits of business inertia.

Business electricity suppliers have adopted this worst practice - 'new customer only' pricing policies and the SAVE toolkit.

Its’ now the business electricity customers who are getting the ‘new customers only’ treatment and are at a serious disadvantage with none of the protections offered to the domestic customer by the watchdog, Energywatch. At least the domestic consumer is at liberty to switch supplier whenever.

This has given business electricity suppliers a buffer in which to recruit new customers with even more attractive rates whilst the ‘loyal’ customer is forced to subsidise this new acquisition.

Customer loyalty counts for nothing.

Customers should be able to trust their business electricity supplier to give them the same price as they offer new customers.

Graham Paul, director of electrity4business, the independent business electricity supplier, said “These new customer only pricing policies are shocking. There isn’t any reason why an existing customer should be offered a worse price than new customers. After all it costs the supplier more money to take on a new customer.”

Some suppliers write to customers up to four months before contracts expire with inflated renewal prices. These letters say that the offer of price increases will deemed to have been accepted unless the customer rejects the price increase. In many cases customers simply accept the price hike through inertia because they’re to busy trying to run their business.

electricity4business claims it can undercut these renewal prices and save businesses up to 20% on their business electricity bills.

“Business electricity customers should make sure that they don’t accept hiked up renewal prices and insist that their current supplier gives their ‘new customer’ price,” says Mr Paul.

Contacts

For interviews, quotes, photos or comments contact:

Bernard Scally

electricity4business

Phone: 020 8847 2538    

Editors Notes

electricity4businiss is Britain's independent electricity retail company specialising in the supply of electricity to small and medium sized businesses. E4Bs aim is to cut the cost for British business by offering lower prices.

http://www.electricity4business.co.uk

###

Share article on social media or email:

View article via:

Pdf Print

Contact Author

Bernard Scally
Visit website