06/ 19/ 2006
by Tamara E. Holmes
Chances are, you're looking for ways to save your small business money. However, one source of savings that you may have overlooked is the cost of utilities, such as electricity, gas and water.
There are some things business owners can do without; unfortunately, utilities don't fall into that category. Though many factors can affect utility rates, such as unrest in the Middle East or natural disasters that can cause prices to spike, the cost of your utility bills may not be entirely out of your control. By being proactive and following a few steps, you can help ensure you are paying as little as possible to keep your utilities running.
Check current contracts. While you may have gotten the best rates possible when you initially signed your utility contracts, they may not be the best rates today. Rates change, and sometimes those rate changes may be more favorable to the customer. However, a utility company is unlikely to call to tell you that a different plan might save you money, so making a quick phone call to see if you have the best possible plan could save you money in the long run.
Scope out the competition. You're more likely to find a better deal if your business is in an area with competing utility providers, Call different companies to see who has the best rates. If your business has more than one location, you may have more leverage if a utility provider can win the business of each location. Don't be afraid to tell your current utility provider that you're shopping around for a better rate. That may give the utility company enough incentive to offer you a better deal.
Avoid peak usage. Utility billing cycles are often broken up into peak and non-peak times. During peak times, energy is typically the most costly. By finding out from your utility provider what parts of the day are peak times, you may be able to decrease your energy consumption during those periods. For example, if you run machinery certain days a week or at a certain time of day, it may make sense to run that machinery during non-peak hours if you have the option.
Bid for energy. In some regions, utility companies bid for customers through reverse auctions. In such a scenario, multiple companies would submit a quote in order to win a company's business. These auctions can result in huge savings for a business. Energy brokers and utility consultants such as Independent Energy Consultants Inc. work to help customers get the lowest bids from competing utility providers.
Become energy efficient. Of course one of the best ways to cut energy costs is to use energy more efficiently. Spend a little money now to enjoy great savings later. For example, timers and occupancy sensors can be used to cut off or decrease lighting when areas of your business are not being used. Likewise, lighting upgrades can enable the use of energy-efficient bulbs, and insulation can be used to keep heat or cool air from escaping from the building. Also, be proactive about fixing things that will raise your utility bills such as leaks.
In all likelihood, each of your utilities is a service that your business cannot do without. But with a little forethought and effort, you can make sure you're paying as little for them as possible.
