How Easy is it to Switch Business Energy Supply?
Entering a business energy supply contract isn’t just about the immediate term you agree. Energy suppliers, once you are in contract, have differing propensities for allowing you to leave their supply at the end of the agreed term. Your business energy supplier can prevent you from leaving their supply at the end of your contract period by raising and industry objection. An industry objection should only be raised in the following circumstances:
- Where a pre-existing contract is still in place with the supplier
- Where a related meter has not been picked up in any application for transfer
- Where a debt that cannot reasonably be settled under the next invoice payment remains on your account
Despite there being no particular reason for any supplier to have a greater proportion of errant customers unaware of their contract end dates, related meters or bad debt in their portfolio, their behaviour around objections and preventing switching differs considerably.
The Business Juice Ease to Leave survey
The Business Juice Ease to Leave survey is an analysis of supplier propensity to prevent a customer transfer. The survey for January 2015 analyses sales made between March 2014 and January 2015 where a customer is applying to leave the supply of their existing business energy supplier. The ease of leaving a supplier is represented by, in percentage terms,
the propensity for objection to be raised against an application to leave the supplier. A poor rating doesn’t necessarily suggest the supplier is undertaking anything untoward as some reasons for preventing transfer, as laid out above, are perfectly legitimate. Indeed with the industry average 17% of transfers being prevented this situation is not uncommon. However it does suggest customers need to be fully prepared for any such obstacle and to carefully consider the trends amongst suppliers before entering a contract.
Easiest to Leave
In the January 2015 Business Juice Ease to Leave survey, the independent suppliers again proved to be the easiest suppliers to leave at contract end with 5 of the top 6 being independent and objecting to less than the supplier average of 17% of transfers. SSE is the only Big 6 supplier who makes it into the top 6. (The results from the prior survey periods of July and October 2014 are also detailed for comparison purposes)
With these suppliers you can be safe in the knowledge that at contract, as long as you have abided by your contract terms, you will be free to leave and take advantage of the market opportunities available at that point.
Most Challenging to Leave
The top 4 suppliers
most likely to block a transfer have a similar make up featuring three independent suppliers and one Big 6 supplier. Opus Energy’s level of objection has increased considerably over the last quarter whilst the supplier previous most likely to block a transfer, BES, has improved, however both are more than twice as likely as the supplier average to object to a transfer away from their supply.
With these suppliers when entering an initial contract it is essential to be absolutely clear in your contract dates and terms to ensure you provide yourself with the easiest opportunity to leave at contract end.
The Overall Table
The overall table illustrates the remarkable differential between the most challenging and easiest suppliers to leave at your contract end. A new entrant to the table is Utility Warehouse who perform just below the supplier average at 16.7%.
Despite there being no particular reason for any supplier to have a greater proportion of errant customers unaware of their contract end dates, related meters or bad debt in their portfolio, their behaviour around objections and preventing switching differs considerably
Trace Sample
The following suppliers were also analysed over the latest period; however the level of switches away from their supply was deemed insufficient to draw a concrete conclusion of their performance. For completeness however the results gleaned were:
