My Eye-Opening Experience

Do not be made a sucker by an electricity comparison provider? As a business owner in Australia, I recently had an encounter that left me questioning their claims.

About a year ago, I blogged about the pitfalls of using the government electric comparison websites here. In summary, the figures on the government website I would get from my existing provider were wrong for me. It made me wonder if the other figures quoted from different providers were terrible, too. 

My recent experience with a commercial energy comparison provider is here. It all started with an email stating that the plan they set up for me was running out and it was time to renew. The problem here was my existing plan had a few months to go and that they never set it up. But as they did promise to slash my shop's electricity bills, I decided to find out what they had to say. So I rang up and got a cheerful voice claiming to be an "electricity expert". She offered to find me the cheapest plan for my business, promising savings. Admittedly, the quoted amount seemed too good to be accurate, but I would be happy if something could be done with our electric bills.

The conversation went something like this:

1. They asked for some basic details about my shop's energy usage.
2. They wanted a recent electric bill.
3. The call ended with her excitedly promising "thousands of dollars" in annual savings by quoting one much cheaper item.

I signed a form allowing them to look and later sent a bill 

She then called back with an offer. The offer, however, seemed too good to be true. Trusting my instincts, I requested the information in writing to allow me to digest it. Here's what unfolded:

1. An email arrived, but it lacked the comprehensive details I expected.
2. Upon closer inspection, I made a startling discovery: the new plan was actually more expensive than my current one—20% more.
3. I reached out for clarification by email, only to be met with silence. They never responded.

Retail electricity costs

Here are some facts about electricity costs for small retailers in Australia:

Electricity prices are up, with government taxation playing a significant role.

On average, small businesses in Australia pay between $700 and $1,400 a month for electricity. No matter what they say, you are not going to get a vast reduction.
 

Energy bill reduction for shops

Here are some tips for energy efficiency

1. Upgrade to energy-efficient lighting: LED bulbs can significantly reduce your energy consumption.
2. Optimise your heating and cooling: Proper insulation and smart thermostats can make a big difference.
3. Invest in energy-efficient appliances: Look for appliances with high energy star ratings.
4. Implement a switch-off policy: This one is inexcusable. Ensure your equipment is turned off outside of business hours. 
5. Use natural light: Where possible, use natural light to reduce reliance on artificial lighting. I opened the blinds at work; we work in the daytime and have plenty of sun. 

Lessons Learned: A Retailer's Guide to Energy Savings

This experience taught me valuable lessons that I believe every business owner should know:

1. Do your homework: You have got to use some intelligence
2. Look at the big picture: Don't be swayed by one attractive rate. Always consider the total cost.
3. Plan B: Check what happens if it does not work out and you want out
4. Leverage your relationship: If you're satisfied with your current provider, before doing anything by explaining the situation. I have an offer for .....

Red Flags to Watch Out For

Based on my experience, here are some warning signs that an energy offer might not be as good as it seems:

1. Pressure to sign up immediately
2. Reluctance to provide details in writing
3. Promises of unrealistic savings

Wrapping Up

Be careful. Also, remember the cheapest plan is not always the best. Customer service and provider reliability are crucial for keeping your business running smoothly. 

Electricity prices are going up, here is a sample of what is being sent out now.

This works out to between a 5% and 40% increase. Is solar going to help? I doubt it, most shops are rented so it is not an option and besides there is now a growing solar that the growth rates in the daytime are less of a problem than the hours when the solar dies. Solar problem is that batteries to store power are not cheap. 

For now, for most shops, their computers' energy use for the POS System is a significant portion of their electricity use but calculating electricity computer uses is a difficult undertaking since it relies on the sort of equipment you have and what you are running. A lot of programs use a lot of power. As a punt say $100+ a year per computer run for 12 hours a day. 

Having said that, I can tell you some points to consider: 

- In computer systems, specific components eat more electricity than others. Some like the video you have no control over. Typically, your standard desktop computer will use between 100 to 400 watts however if you have overclocked your computer, it will use more electricity.

- A desktop computer uses more power than a laptop because laptops are optimized for battery life.  So you will save electricity by using your laptop.

- The energy use of some of the peripherals like keyboards and mice is low usually below 0.5W, on the other hand, an average laser printer tends to consume anywhere between 300 to 550 watts of power, which is often more than the computer. 

- Typically desktop monitors consume between 20 to 100 watts of power

- You can look at the equipment label that shows its power consumption but this is generally a theoretical maximum and not a typical figure. So it is only a rough guide. 

The equipment we have been actively selling recently is with energy star ratings so they use about half the electrical energy of the older type of computers. There is a saving there for our clients.

How To Cut Back Your Computer Energy Consumption

- Turn off computers when not in use. However, it is unwise to do this too often. If you intend not to use the computer in the next hour, yep turn it off. 

- Selecting the hibernate option is not recommended as it turns off something in processing; turning it off works better in a shop. 

- Set your monitor automatically to turn off after 20 minutes of inactivity.

- Laser printers not in use should be turned off.

- If you want to know exactly, you can get a power meter in the hardware shop for about $25. You plug it into the power plug and it records the power consumption of the object. Most people that have one, measure everything in the shop and at home. It will almost certainly pay its cost.  

It is estimated that about 20% of all retail loses come from faulty and bad data entry. Here is one of the biggest item. Items that are no longer on sale but still marked as being on sale. If you visit the bargain hunters sites online, you will notice this is frequently what they are reporting. This sale is over but if you go here, you will find that these item although marked at $X will show on the till this 50 to 80% reduction.

The problem is that many of you will have so many items in the shop that although the sale is over, some may be missed, so they are still marked as being on sale either on the label or in your point of sale system. As such you could now accidentally have to sell items which are at the wrong price.

So here is a quick way of finding these items.

Go to the stock system.

Select Sales Promotion here

Now out pops up a screen, put in the appropriate dates say from the 01/01/2020 to 31/01/2020

You will get a report of the items that you can investigate.