Four ways small businesses can control costs and do business better

Wednesday, 04 March 2020

Protect your bottom line with the help of fixed price electricity and gas and other energy tips.

Four ways small businesses can control costs and do business better

Protect your bottom line with the help of fixed price electricity and gas and other energy tips.

Dealing with the numerous demands of keeping a small business going from month to month, you may just pay your bills and accept rising prices. But taking a few minutes to fix energy prices is one simple way to help manage cash flow and save time in the long term.

Keep control of costs and cash flow

Running out of cash is a big issue for small businesses and can be fatal. In the UK, only 43.2% of businesses started in 2012 were still active in 2017, according to the Office for National Statistics. Most industries are cyclical but to help smooth out ups and downs you can fix the price you pay for some things, like utilities.

Consider a contract that provides price certainty for the duration of your contract, so you can budget with confidence. Fixed contracts forecast future price increases to give you price stability, reduced risk and peace of mind. SSE Protect contracts are available for up to 48 months.

As well as the electricity or gas unit charges, check if a contract guarantees a fixed level of existing non-commodity charges. This covers costs that third parties will set, like National Grid charges, transporting electricity through the different networks, and the impact on costs from government schemes and taxes.

Time is money

Your time and employees’ time is valuable. Spending a few hours organising finances now can save many hours – and a lot of stress – later. Getting into the habit of good record-keeping also makes it simple to file accounts and tax returns on time, to avoid penalties and stress.

As a small business, you probably don’t employ a dedicated purchasing or energy manager. You can free up time to focus solely on your core business, with the comfort of knowing your energy contract price is secure, through a fixed contract. This removes the need to manage mid-contract price increases.

SSE Protect includes a discount for paying by direct debit, so you can get a good price and not have to deal with payment whenever you receive a bill. You can also take advantage of a budget direct debit option allowing you to pay a fixed amount every time, so you can keep total control of your budget. Rates are based on direct debit payment – if you’d prefer to pay another way, you can ask for an alternative quote.

And if you install smart meters, you’ll receive accurate bills with no need to take manual meter readings and give them to your energy supplier. This relies on wireless communication, and a new dedicated smart meter network will cover most of Great Britain.

Spending and saving

Not entirely sure where all the money goes? Plan time once every week or month to review your budget. Track necessary and non-essential spending, to see what outgoings are really costing you and where you could cut back.

Energy efficiency is one area where you may not realise your business is wasting money. The first step is to review current consumption and working practices. SSE Business Energy’s energy efficiency resources include a walk-round checklist to help you get started, and tips on what you can do to reduce usage.

All SSE Business Energy’s contracts come with free access to Clarity online energy management platform. This can turn data from smart meters into reports, allowing you to see your energy usage and work out where you could reduce consumption and potentially save money.

Low and no-cost actions can usually reduce energy costs by at least 10%, according to the Carbon Trust.

Go green and get ahead

How does your business measure up against the triple bottom line: profit, planet and people? Environmental and social issues are increasingly important to customers and neglecting these can impact sales.

According to a global survey by Nielsen, 81% of respondents feel strongly that companies should help improve the environment. Nearly three-quarters say they would definitely or probably change their consumption habits to reduce their impact on the environment.

Taking up a renewable electricity and/or gas option is one way to boost your business’s sustainability credentials. Showing customers your eco-friendly commitment is easy with 100% renewable energy like SSE Green which gives you a certificate and logo, proving the energy your business uses is matched to renewable sources.

And if you have electric vehicles to keep on the road, you can run them on green electricity at a fixed price, bypassing fuel price fluctuation. Almost a quarter of small businesses say fuel is one of the main causes for changing business costs, according to a survey for Federation of Small Businesses. You can also charge your fleet for less by using off-peak electricity at night with a contract like SSE EV.

Want more information?

You can find out more about SSE Business Energy’s contracts at ssebusinessenergy.co.uk/energy-contracts/sme-business-gas-electricity.