The need for better communication between small businesses and their energy suppliers has been highlighted in a new report from energy regulator Ofgem.
Of the 95% of small businesses who recalled receiving an energy bill in the last 12 months, 70% did not recall seeing a contract end date or notice period, the annual report, “Micro and Small Business Engagement in Energy Markets,” revealed.
While satisfaction with the renegotiation or extension process is improving, and now stands at 73%, 10% of small business owners still said they were dissatisfied, blaming price increases, poor communication and contract renewal without knowledge.
The report also found “relatively high levels” of distrust in suppliers, while small businesses’ views on energy brokers remained “negative.”
Almost 90%of businesses said they had been approached by a broker in the last 12 months, while 20% reported more than 50 contacts and cold calls.
Meanwhile, just 53% of businesses who were approached by brokers in the past year said they identified themselves clearly and provided accurate information about the services they were offering.
In addition, just 31% of businesses said energy brokers had been upfront about the cost of using their services.
The past year has also seen many small businesses shift away from extending and or rolling-over contracts, towards negotiating new contracts with existing suppliers.
The proportion of all businesses that have switched supplier in the last 12 months has also increased slightly; from 23% in 2014 to 25% in 2015.
While cost savings remain the main factor in decisions to switch, 82% said that knowing that a contract was coming to an end was also a significant trigger, while more than 70% cited receiving a renewal notice from an existing supplier.
Association of Convenience Stores chief executive James Lowman said the report highlighted the need for better communication and support.
“Small businesses should have the same protections as household consumers when dealing with energy suppliers.
“We look forward to the final Competition and Markets Authority remedies in this area, which are due this summer,” he added.