Insights into water competition

The effect of water deregulation on England’s SME businesses

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About Wheatley

Wheatley is the UK’s most experienced supplier of software solutions for managing data flows, market messaging and metering assets in the utilities sector.

Working with all sizes of organisations Wheatley deliver flexible, scalable and robust software applications with a range of hosting options.

We take pride in ensuring our expertise in metering, messaging and asset solutions enhance the efficiency of our customers’ processes, delivering a quality service to support business critical operations.

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About the survey

Wheatley commissioned this survey of 500 SMEs in 2017 with the aim of being one of the first studies to be conducted following the deregulation of the water market.

Knowing that much attention has been paid to the water companies themselves, Wheatley wanted to try and find out how the deregulation might be seen by those companies that this affects – the businesses that can now switch. So how do SMEs view the opening of competition? And does the physical location of the SMEs affect how they see the open water market?

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Data insights

There is a growing awareness of water market deregulation among SMEs

The survey commissioned by Wheatley questioned 500 SMEs across England and asked ‘Were you aware that you could now change water retailer?’.  An average of 58% of SMEs were aware of market deregulation one month after the market opened for competition.  Increases in awareness were seen across all SME customer groups compared to the January 2017 Ofwat survey, but there is still work to be done to ensure that the benefits of competition are available to all businesses; a third of businesses surveyed were unaware of deregulation and so are not able to access the benefits that market competition will bring them.

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England’s SMEs are actively engaging in the water market

SME businesses in England are taking advantage of the opportunities that deregulation has presented.  The Wheatley survey showed that over a fifth (21%) of eligible and aware SMEs switched water provider in the first month of deregulation.  Those who are yet to switch appear to be watching the market closely, with a further 50% of those who haven’t yet switched planning to do so within the next 18 months.

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SMEs are already reaping the benefits of market competition

The Wheatley survey showed that SMEs are already benefiting from deregulation as they renegotiate contracts with their existing supplier or move to a new water retailer.  This has given them the same choice over their water retailer as they currently have for their energy and other essential services.  When SMEs are switching water retailer price is the most important factor.     77% of respondents rated price as ‘extremely influential’ or ‘very influential’ in their decision to change water retailer and 83% of respondents saved money by switching to a new water contract.

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SMEs want to utilise more than ‘core-services’ from water retailers

As well as providers of core water and sewage services, SMEs also look to water retailers to address other water related problems and issues they face. Wheatley’s survey shows this creates an exciting opportunity for water retailers to provide added value services.  These opportunities extend beyond existing value added services, such as water testing to include future propistions which would aide customer retention in a competitive market.

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The White Paper

Wheatley’s white paper is essential reading for leadership teams of water retailers, wholesalers and other industry stakeholders who wish to understand the experience of SMEs in the first month of deregulation, exploring; awareness levels; switching behaviour; benefits; and future perspectives on service demand from their water retailers.

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