Cost of energy threatens Britain’s small retailers

Over half of the UK’s micro-businesses feel that the rising cost of energy is threatening their future, according to a new report commissioned by Utilita Energy.

The report reveals that majority of micro-businesses say they are currently penalised by energy providers with almost half (45 percent) asked to make large upfront payments, while a third (31 percent) claim they are on a high tariff because they are seen as a credit risk, and one in five (21 percent) were turned down by energy suppliers.

The results revealed to coincide with Independent Retailer Month taking place in July, adds that 42 percent of small business retailers feel they get an unfair deal from energy suppliers and 71 percent state they have been caught out by unexpected terms and conditions such as crippling rates, inflexible payment terms, high deposits and extended contracts.

Clare Bailey, independent retail expert and high street campaigner, said: “Passionate, retail business owners are the life-blood of a place – not only do they break up the monotony of “clone-town Britain”, where the same chain stores, coffee shops and betting shops would otherwise populate our high streets, but they make a considerable commercial contribution.

“Statistics illustrate that for every 1 pound spent with a local, independent retailer, some 50-70 pence circulates back into that same community. That same 1 pound spent in a chain store may only return 5 pence to the local economy. So, when you support local stores you are making 10 times more impact, boosting the economic health of your area.”

According to the Department for Business, Energy and Industrial Strategy, micro-businesses now account for an estimated 5.2 million UK private sector businesses making up approximately 94 percent of the UK private business sector. Utilita’s independent survey of over 500 micro-business owners reveals that on average their fuel costs had increased by 215 pounds in the last year.

Shaun Underwood, director of Utilita Business Energy, said: “We should be supporting Britain’s small businesses in these times of uncertainty – but it is clear that there are a significant and growing number of small businesses that appear to be treated unfairly and have very real concerns. I believe customers should not be asked to pay crippling up-front deposits when cash flow is a problem, should not be put onto discriminative contract rates and should not be punished or shunned by suppliers.”

Bailey added: “A secure, affordable energy supply is vital for these businesses; it literally ‘keeps the lights on’ and the business operating. It is clear from the results of the survey undertaken by Utilita that too many of our small businesses feel they are getting a raw deal on prices and how they are treated.”