Most of the quotes that we put together are for businesses that already use an energy broker.
In many cases, they know the broker adds a margin to their rates, so they’re happy to get an alternative quote and to allow both companies to compete for their business.
Sometimes however, we’ll speak with potential clients whose existing broker has convinced them that getting a quote from anyone else is against their own best interests.
Having been told that getting quotes from more than one source could upset suppliers, or complicate the process in some way, they’re convinced to put all their eggs in one basket.
But does this benefit the customer, or just the broker?
Whilst clients may feel that engaging with several different companies would take up too much of their time, it’s important to know that when it comes to getting the very best rates, at least some competition is good.
The reason is that competition between brokers is based largely on price, and crucially, their margins.
By convincing a client not to get quotes from elsewhere, the broker can effectively add any margin they wish.
Since they don’t have to disclose this in order to sell a contract, it often results in companies paying more for their energy than if they hadn’t used a broker in the first place, which kind of defeats the point.
We always recommend using two competing brokers. It ensures that the client doesn’t have to spend too much time liaising with numerous companies, but also that neither one thinks they’ve already won the business before they’ve even provided a quote.
Blinded by Science
Some brokers will claim that what they do is so complicated that it wouldn’t even be possible for another company to get a like for like quote, but we’re not convinced that this is ever true.
Whilst there may be small variances in exactly how each company engages with their suppliers, they all generally stick to a tried and tested format.
The difficulty for customers is, brokers often want to be seen as being different to the rest, and go to increasing lengths to convince their clients that they’ve reinvented the wheel.
As a customer, the decision is always yours as to how many companies you wish to use.
If your current broker is confident enough in what they do, and that they offer value, they should have no objection to competing with another company for your business.
Has your broker convinced you to only get quotes from them? Perhaps they’ve asked you to sign a letter granting them exclusive rights to negotiate your contracts.
If so, ask yourself what their reasons might be, and remember that they’re commercial organizations that make money by adding a margin to your rates.
We never ask for exclusivity. We’re good at what we do and we don’t mind proving it. If you’d like to give us an opportunity to compete for your contracts, please feel free to get in touch.