First water switching service plans to level playing field for small retailers

A switching service for the water retail market will launch in January as a platform for businesses to change water suppliers

The service from Switch Water Supplier will be set up as an online auction where water suppliers can bid on tenders from business customers of any size. The customer can see all bids as they come in and each supplier can see bids from competitors.

Graham Mann, who established the service, said it will open the market up for smaller retailers to access and bid on contracts from SMEs and grow their customer base to rival some of the larger retailers.

“It’s a way of bringing customers and water retailers together in one place. At the moment there’s a big divide: the larger water retailers aren’t keen to get involved with customers who spend a couple of thousand pounds – they want the bigger companies and this is where the market falls down because there’s no vehicle for the customers to get into the market. But this is the vehicle, the whole market gets a chance,” Mann said.

Microbusinesses, those with fewer than nine employees, make up more than 96 per cent of the total number of businesses and those with more than 250 employees account for fewer than one per cent.

Mann compared the opportunity for smaller retailers to compete with larger ones as the progress Lidl and Aldi made in the supermarket scene competing against Tesco.

“For anyone who doesn’t know anything about the water retail market, it’s very complex because each of the 24 suppliers promise the earth.”

Since opening in 2017 the water retail market has suffered with high levels of customer complaints, often attributed to billing issues and incorrect data. In July the Consumer Council for Water (CCWater) warned three retailers for their poor performance in its report that showed complaints had risen for the second consecutive year.

The water watchdog criticised the poor performance of the water market’s biggest retailer, Water Plus, along with smaller suppliers – Clear Business Water and Everflow – for their part in fuelling a 20 per cent increase in written complaints during 2018/19.

Mann said: “Customers have lost confidence in the marketplace. There have been successful switches and there are not so successful switching stories.

“If you don’t know the ins and outs of water and wastewater effluent bills people could be overpaying by huge amounts. There are hundreds of thousands of meters that haven’t been read in years, so a lot of commercial customers are getting estimated bills. The tariffs are incorrect, and they are lining themselves up for huge backlog bills.”

Mann, who has worked as a water auditor and consultant for more than 30 years, said the service would let any size company see price bids from each of the retailers in a live bidding session during which companies can also see competitors bids.

Switch Water Supplier also offers a data checking service for clients to assess whether charges are correct on past water supply. They can check whether charges are correct, if they are due back any money, and ensure the data is correct for the future.

He said the service would give smaller newer water retailers a chance to expand their businesses by bidding for contracts from SMEs that larger retailers might not be interested in.