What would your business have to do to boost its profits by £1,500?
There's an easy way and a hard way to boost your profits by £1,500. We've looked at both
Energy is an expensive cost that Britain's small businesses have always had to contend with, and the complex nature of SME contracts often leaves many paying over the odds for their power.
The latest Ofgem figures show that businesses on rollover contracts are being charged an average of £1,500 more for their gas and electricity than firms that have switched to a new provider, and some SMEs are clearly missing a trick here.
We help businesses of all shapes and sizes find a better deal - and if anyone needs convincing that this is worth doing, they just need to consider the lengths some businesses would have to go to in order to boost their profits by the typical saving figure of £1,500.
Whatever industry you're in, getting a cheaper energy deal is an easy way to boost profits
Pubs are big consumers of gas and electricity, with drinks to chill, punters to keep warm and often food to cook. A landlord could switch their energy in the time it takes to clean the bar, but making £1,500 selling beer is a big ask.
Based on a 20% profit on pints sold at an average of £3.20 each, you'd have to sell an extra 2,343 pints to see your bottom line improve by that magic figure. That's a lot of pump pulling.
Lighting, hairdryers and endless cups of tea for customers - hairdressers are constantly plugged into the mains, and it's expensive to keep everything switched on.
Assuming an average haircut costs £50, that's 150 customers a hairdresser has to have in their chair to boost their coffers by £1,500. At 50 minutes a haircut, that's 125 man hours - or a fortnight's worth of haircutting.
Spiralling costs scupper the longevity of many restaurants. No wonder, the energy it takes to keep ovens fired up for the majority of the day can be extremely costly.
Securing the best energy tariff you can gets this under control. Let's assume a restaurant sells a £6 starter at a £1.20 profit margin - they'd have to sell 1,250 to add £1,500 to their bottom line. What restaurateur worth his rock salt would say no to those sales?
You can see the point we're making here - whatever industry you're in, getting a cheaper energy deal is an easy way to boost profits.
The savings you'll see throughout the duration of your contract could make a big contribution to your business's prosperity, and the process is a whole lot easier than you might think.
Do a quick sum for your business - then ask yourself what you'd give for those extra sales. Well, you can effectively make that happen with one short phone call.
Limited-time offer - Any business that sets up a gas or electricity contract with Make It Cheaper will be entered into our prize draw for a chance to have its energy bills paid for an entire year! Imagine how much money that would free up in your budget.
Image credit: Luz Bratcher
Dan O’Sullivan is Make It Cheaper's Web Content Manager, which means much of his time is dedicated to ensuring we have plenty of online material to help business owners understand the energy, insurance and telecoms industries. With years of experience working alongside SMEs, Dan is committed to making life as easy as possible for smaller firms. You can email Dan at firstname.lastname@example.org