Utility Week

UTILITY WEEK | 8TH - 14TH DECEMBER 2017 | 25 Customers ate a better deal felt their organisation did not use enough water to save any money. Further, one in five (22 per cent) said they did not see the need to switch because they are happy with their current deal. This implies they are not aware of the benefits beyond a quick discount on their bill. See graph, "Reasons SMEs will not engage with the market". Inconsistent wholesalers Inconsistency in wholesalers' charges, and their practices generally, has not made life easy for retailers. In a June issue of Water. Retail, retailers called for standardisation in the way wholesalers put together their pricing, and the portals they use to interact with retailers. In a column for Utility Week at the begin- ning of November, Business Stream chief executive Johanna Dow called for the ration- alisation of wholesale tariffs and more stand- ardisation around wholesaler policies in general, which she insisted would simplify market processes and significantly improve the experience for customers. The lack of standardisation in wholesale charges means retailers have to create hun- dreds of tariff combinations to match the variations across different wholesale regions. As an example, Dow said that in order to on-board six national customers, Business Stream had to create 2,000 different tariff combinations. "The sheer number of tariffs is making the on-boarding process and day-to- day maintenance of customer accounts very time-intensive and costly for retailers and confusing for customers," she said. Market entrant developments There have been 11 new entrants since mar- ket opening, and several more companies are going through the process of entering the market, according to the chief executive of Market Operator Services Limited (MOSL), Chris Scoggins. The number of retailers listed on the Open Water website now stands at a mighty 23. These are either retail arms of incumbent wholesalers, independent companies that have joined the market from Scotland, or entirely new players. One or two of them are only licensed to operate in-area. Some are more ambitious and active than others, but by far the biggest gainers of market share are SES Business Water and Everflow. The latest to have joined the market is First Business Water. The retailer evolved from a background in energy efficiency, and says sustainability is at the core of its values. "We not only want to supply water but empower businesses to use water more efficiently," says managing director Nish Dattani. Yorkshire Water is expected to sell its business customers soon, aer making a dramatic U-turn in February which saw it abandon plans to transfer its non-domestic customers to its retail spin-out, Three Sixty. Speculation circulating the market has been that the voracious Castle Water will acquire these customers, growing its business even more. NWG Business and Anglian Water Busi- ness announced their joint venture – Wave – in March, just a few weeks before the market opened. The companies began rolling out the Wave brand to customers in November, and will continue to operate with the tri-brand on customer invoices and externally in the market for the next few months. From March 2018, customers will start to see the stan- dalone Wave brand present in the market. See graph, "Switches to and from the most active retailers". The gradual rise of self-supply Coca-Cola became the latest big business customer to request a self-supply licence. Despite predictions that self-supply would take off in a big way in England, there are currently just three self-supply licensees in the market: Greene King, Whitbread, and Marston's. All are being assisted by Waterscan. Waterscan director Claire Yeates warns that self-supply is not just a "quick win" by cutting out the middleman to reduce costs, but takes a great deal of hard work and dedi- cation to make it worthwhile. She told Water.Retail in October the com- pany was having to turn down potential cus- tomers for which it does not see self-supply as a commercially viable option. "I'm turning people away because it's a rigorous process to go through and they have to be of the right mindset to be able to do it," she said. Market wins Taking some of the big customers that have taken the plunge and switched as examples, it is clear switching is not all about getting a quick discount on the bills. For example, when House of Fraser, which has 11 sites, switched to Business Stream in 2015, it said it hoped the deal would help it to develop its sustainability strategy. David Lloyd is another high-profile switcher. It has 84 sites and chose Water Plus as its retailer. Talking about its reasons for switching, the leisure chain said it was look- ing at efficiency as well as cost savings, and that consolidated billing was another major driver. Some of the contracts and deals that have been struck Water2business and Lush: 27 November Water2business signed a three-year deal to sup- ply water and wastewater retail services to Lush, the ethical cosmetics, Poole-based company. The deal includes 66 retail stores across England and Scotland, the company's offices and manufactur- ing factories. Everflow and Hurlingham Club: 22 November The Hurlingham Club in London appointed Everflow as its water supplier, following a com- petitive tender conducted by the Grand Union Water Company. Grand Union said the process uncovered "billing errors" and locked in "certain savings" for the contracted period. Utility Week understands Everflow has replaced Castle Water as water retailer for the private members' club, which borders the Thames in Fulham. Business Stream and Regus: 22 November Business Stream was awarded a new three-year contract to supply water and wastewater services to workspace management and business support service provider Regus Management, which has 18 sites in Scotland. Business Stream will provide consolidated billing and has already helped the company realise more than £100,000 of savings over the past two years. Castle Water and Business Stream, public sector: 8 November Castle Water secured a national contract through the Crown Commercial Service framework for the provision of water and wastewater services to the public sector in England, worth an estimated £28.9 million. Meanwhile, Business Stream was also awarded a contract via the framework, which is potentially worth £10.6 million. Water2business and Boston Tea Party: 30 August Water2business signed a deal to supply water and wastewater retail services to Boston Tea Party. The British café chain, which has 20 sites across the South West and Birmingham, is one of the first in the region to benefit from the deregulation of the market. AWB and Cameron House: 21 August Anglian Water Business won a contract to supply water retail services to luxury Scottish spa hotel Cameron House. The four-year deal was brokered by third party intermediary, Inprova Energy, and has enabled Cameron House to secure an improved rate for water and wastewater supply and services. The hotel – located on the banks of Loch Lomond in Scotland – said it wants to meet its environmental goals and reduce water consumption. Water.Retail is a fortnightly Utility Week Intelligence premium product. 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