Small businesses in the UK are being warned by OFWAT that they could see a rise in water bills. The regulator has indicated that some businesses could see their water costs increase by up to 30%.
This is tied to various factors, including rising operational costs, infrastructure improvements, and growing demand on the water supply.
For small businesses already struggling with energy price hikes, and supply chain challenges, this forecasted surge in water bills is another strain on their operational costs.
However, while the outlook may seem grim, there are strategic ways to mitigate this impact—one of which is leveraging the expertise of utility consultants.
Why are water bills increasing?
OFWAT's warning stems from multiple pressures on the water industry, including:
- Aging infrastructure - Significant investment is needed to upgrade and maintain water infrastructure, much of which is outdated. These costs are often passed on to consumers, including businesses.
- Environmental challenges - Climate change is creating more volatile weather patterns, putting pressure on water resources. Droughts and flooding increase the cost of water treatment and distribution.
- Increased demand - Population growth, urbanisation, and higher water usage by industries mean water suppliers must invest more to meet the growing demand.
- Inflation - Rising inflation across various sectors, from energy to labour costs, also impacts water providers. These increased operational expenses inevitably find their way to end-users through higher bills.
The impact on small businesses
For small businesses, a 30% increase in water bills can significantly impact profitability. Even businesses with lower water usage will feel the pinch, especially when combined with other rising operational costs.
Small businesses often have tighter profit margins and less flexibility to absorb these increased costs compared to larger corporations.
For many, passing on these costs to consumers could result in losing their competitive edge or alienating price-sensitive customers. This is where expert utilities management comes in.
How utilities consultants can help
Utility consultants, such as, Resolve Energy, can help businesses manage and potentially reduce the impact of rising water bills. By offering tailored solutions and industry-specific advice, consultants provide a pathway for cost-saving and efficient water usage. Here’s how:
Negotiating better rates
We have a comprehensive understanding of the water market and can negotiate directly with suppliers to secure better rates. With access to a wide range of suppliers, our consultants can help businesses switch to more affordable providers or renegotiate existing contracts, often resulting in lower costs despite industry-wide price hikes.
Water usage audits and efficiency improvements
Our consultants will carry out a thorough audit of your water usage, identifying areas where waste can be reduced. For example, they might suggest implementing water-saving technologies, fixing leaks, or optimising processes to minimise water consumption. Even small changes, like upgrading fixtures or adjusting cleaning processes, can result in significant savings over time.
Budget forecasting and long-term planning
One of the biggest challenges for small businesses facing rising utility costs is uncertainty. We can help create accurate budget forecasts by anticipating price changes and advising on long-term strategies to mitigate these increases. For example, a consultant can suggest water contracts with fixed rates, providing more certainty and protection against future price hikes.
Our team offers such forward-thinking solutions, allowing businesses to plan more effectively for the future and avoid nasty surprises when their next water bill arrives.
Leveraging industry expertise
All our team stay up to date with regulatory changes, market trends, and opportunities for businesses to save. When OFWAT implements new regulations or opens grants and subsidies for businesses making efficiency improvements, we can ensure your business is ready to capitalise on these opportunities.
This level of market insight is often beyond the reach of small businesses that do not have the time or resources to stay abreast of constantly shifting utilities markets.
Consolidated utility management
Some businesses find managing multiple utilities—such as water, gas, and electricity—overwhelming and time-consuming. Our team offer comprehensive utility management services that streamline the process, allowing businesses to focus on their core operations rather than dealing with multiple suppliers and fluctuating bills.
By consolidating utilities under one management system, businesses can often save time and money through more efficient contract negotiation and unified billing.
The Bottom Line
With OFWAT’s warning that water bills could rise by as much as 30%, small businesses must act swiftly to avoid a significant blow to their bottom lines. While the cost pressures on the water industry are real and largely unavoidable, businesses do not have to face these increases alone.
By partnering with a utility consultant, small businesses can take control of their water usage, secure better rates, and plan for the future with more certainty. The right consultant can provide valuable insights, negotiate on your behalf, and offer solutions to help offset rising costs, allowing you to focus on growing your business rather than worrying about your next water bill.
In a challenging economic environment, the key to staying competitive is finding the right support—and when it comes to utilities, that’s where Resolve Energy comes in.
This approach can help businesses weather the storm of increasing water prices while staying focused on their core goals. Would you like me to explore more about how small businesses can save on other utilities as well?
If you're looking to save money on your energy bills then why not get in touch today? The relationships Resolve Energy has developed with over 24 of the UK’s biggest business energy suppliers allows our energy experts to source the best business energy rates available for your company right when you need them. Request a free quote today and start saving money on your energy.
