Today’s Chief Financial Officers (CFOs) know that time is money, and time wasted on avoidable administration means less time spent on bigger business issues. With energy costs becoming a bigger part of the bottom line, energy management is increasingly part of the CFO’s remit. In this article, we explore three of the reasons CFOs are making the decision to switch energy retailers.
It’s a fact that freeing your staff from menial tasks allows their capabilities to grow and increases employee engagement. But not all inefficiency starts within your workplace: more leaders are finding that improving internal processes relies on seeking more effective partnerships with the businesses they work with.
In a survey aimed at better understanding what businesses are looking for when they choose their energy retailer, the basic issue of billing was at the top of the list of customer grievances. Bills that are inaccurate cause administrative pain and bills that aren’t on time cause cash flow issues and make budgeting a challenge. No matter how it’s cut, bad billing chews time and money that could be better spent on real business outcomes.
When it comes to energy costs, CFOs know that there’s a variety of components to address when maximising cost savings for their business. One of them is ensuring that the business is on the right energy network tariff structures. Network tariffs are charged by the energy network providers who provide the poles and wires and are passed on by the energy retailers.
Network charges can make up around 30% of a business’s energy bill, yet many people are unaware that they can change to more suitable tariffs which may substantially reduce the total energy bill, usually without any change in energy consumption.
Understanding network tariff structures is complex and most businesses don’t always have the in-house expertise to understand and analyse their business’s energy data alongside the rules of tariff eligibility. CFOs are starting to look for energy retailers who offer the service of network tariff reviews as it means they don’t necessarily require the in-house expertise to do it and, in some cases, can uncover thousands of dollars in annual savings.
Business needs change regularly, and contracts that set upper and lower energy usage thresholds with penalties for breaching them may be problematic. Energy retailers who offer load-flex tolerance – which means no unexpected costs if your business energy usage changes (e.g. efficiency measures, installing solar panels, production changes) – are also getting the attention of those in charge of managing business costs.
To learn more about why CFOs are choosing to switch energy retailers, read PwC’s Beyond price: What Australian businesses are looking for from their energy retailer.
23 March 2021
6 January 2021