Do businesses need help with commercial bills?
New research from an energy and water consultancy has suggested that many businesses in the UK are lacking the skills needed to pay commercial utility bills.
Utilitywise has suggested that one in five firms do not understand their bills and that 60% do not recognise the difference between ‘estimated’ and ‘actual’ readings.
A quarter also misunderstood what was meant by the term unit rate and failing to grasp these terms could mean firms are paying more than they need to for their energy.
The study also revealed that the issues were prevalent across businesses of all sizes and were not limited to those with small numbers of staff.
Nearly the same proportion of staff in small and microbusinesses said they lacked the skills to make sense of their bills as those in companies with between 50 and 249 workers.
Businesses in Sheffield and Liverpool were found to be most unsure of their bills as they could not grasp what all of the information provided by utility providers actually means.
A third of workers in manufacturing firms also revealed a lack of understanding while as many as two million businesses may never, or only occasionally, check their bills.
Despite this, three quarters of businesses feel they pay too much for their utilities and the additional spending could be placing unnecessary pressure on finances.
Reducing energy usage is one way of tackling the issue, but switching to better deals and cheaper suppliers could also provide a boost to a firm’s cashflow.
In many cases the impacts of the extra spending will not be too pronounced, but for smaller firms who operate with small levels of finance, seeking advice is recommended.
Insolvency Practitioners could provide advice on how to streamline a business or highlight areas where potential savings could be made for example, while also assisting those in more serious financial trouble.
A major issue for small businesses that was identified in the study is a lack of time for decision makers to investigate if there are better utility deals on offer.
Some 23% said they did not have spare time to check bills and a further 23% said they trusted the information to be accurate.
Around 60% of firms trust estimated bills according to Utilitywise, yet using accurate figures could potentially provide high levels of savings.
Firms are therefore encouraged to check their usage where possible and to question any jargon on bills that they do not understand in order to ensure they get the best deals.
By Phil Smith