The hidden costs of setting up an energy supplier

Corner Image Curved
Home » The hidden costs of setting up an energy supplier

Over recent weeks we’ve seen increasing attention from the Regulator on new entrants to the UK energy retail market.  There have been widely publicised complaints that some of the challenger entrants don’t have the necessary skills or finance in place to deliver the service expected by the Retail Supplier Licence Conditions, with Iresa being banned from taking on customers until it sorts out its woes with regard to service, and Utility Warehouse being investigated for how it manages debt.

It’s important that those looking at the UK energy supplier market take into account all the elements that make up a successful business.  Whilst it’s easier than ever to get high quality and cost effective billing and back end systems set up within a reasonable initial investment (whereas in the past these might have cost £££ with years of project time needed to set them up), what a number of suppliers are failing to recognise is that they also need to make continued investment in people and processes as the business scales.  Whilst systems will go along way to making sure that a business is operational, that billing is progressing and that meter reads are being processed, it’s the people brought in to set up processes and how a business can manage exceptions that will really be a measure of success.

We all recognise that this industry is complicated, perhaps unnecessarily so!  But that makes it increasingly important that people are brought in with the right skills and experience.  And with a constantly growing number of new entrants – there is a limited pool of ‘experienced’ hires with the right skills to manage complex operational issues – customer service, debt recovery, billing etc.  This limited pool means that prices for those skilled experts are rising – and this needs to be factored into the investment planning process.  Because whilst systems have fixed costs – people don’t.

Here at Utility People we’re seeing salaries going up consistently, as there is more demand for the limited numbers of people with the right experience.  I’ve talked before about the rise of the Interim – in many cases this can be the right solution for a growing business.  But even then, costs are rising and businesses need to prepared to invest in talent to help their organisation grow – and to get those vital processes right.

So I would urge companies to factor in to the business planning the cost that bring in the right people may incur – and to make sure that this is a long term investment – to grow energy businesses successfully.


Ready to find your perfect job?