Gas & Electricity Contract Procurement
Case Study - Kitfix Swallow Group
Overview – Kitfix Swallow Group is a small manufacturing/wholesale business based in Norfolk that has seen consistent growth since its foundation in 1960.
Energy costs are of prime concern to all manufacturers.
Faced with ever rising costs when their gas and electric contracts came up for renewal, Kitfix contacted the EAG Energy Action Group for assistance obtaining more competitive pricing.
Our Solution – Electricity: Before starting, we sought a thorough understanding of the business and its requirements. Then, armed with a Letter of Authority from Kitfix, The EAG contacted the incumbent energy supplier to establish accurate consumption data, meter details, current tariffs, contract details and contract termination dates. This is vital to any competitive procurement process and by verifying these we could ensure that Kitfix would be able to move to the supplier offering the most competitive pricing.
Kitfix’s existing tariff was reasonable but the proposed renewal rate was substantially higher. This is a common feature of most contract renewal offers. By monitoring energy prices daily, we were able to recommend that Kitfix delay entering a new contract for a short period as seasonal factors temporarily pushed prices higher. When the prices returned to more advantageous levels, we issued tenders to various suppliers, securing competitive offers that improved on existing prices.
Furthermore, the supplier was willing to extend the pricing over a fixed 3-year term, giving Kitfix predictability and stability over the longer term. Kitfix signed the best contract and the new supplier picked up the supply seamlessly when the old contract ended.
Our Solution – Gas: Kitfix contacted the EAG again when their gas contracts were due for renewal. At this stage we validated the contract and supply details of their two gas meters with the intention of rationalising diverse contract dates to a common end date in the new contract. With accurate data gathered from incumbent suppliers we then tendered to several appropriate suppliers for competitive rates.
The Result: The EAG was able to help Kitfix secure 3 long term contracts on gas and electricity at lower rates than Kitfix’sprevious contract rates and substantially lower than the renewal prices on offer. This translates into savings in excess of £4,000 across the three supplies compared to their previous energy costs and substantially more compared to the total costs the renewal pricing would have delivered.
In addition, all Kitfix’s energy contract renewal dates are now aligned, providing them with access to seasonally favourable pricing, and reducing administrative effort. With long term, competitive energy contracts locked in, Kitfix can concentrate on what they do best.
Comparative total gas cost comparisons – The EAG’s easy to use quote comparison
