CFOs and finance teams are always looking for ways to increase the efficiency of their business, and that largely comes down to two things: one is to sell more product, which is something that businesses are always trying to do but it’s also something over which they don’t have that much control.
The other, and this is something that they do have control over, is to cut out unnecessary wastage so that they are spending less. There’s nothing as disappointing as celebrating a sales success only to be presented with an unrelated but nonetheless hurtful cost blow out the next day.
But to keep your costs under control you first need to know what they are, and know in close to real time so you can do something about it. Our energy metrics service provides Finance Managers and CFOs with the information they need to monitor their energy spend and tell very soon if something is going wrong with their energy costs.
Our metrics service can benefit your bottom line in many ways, including network tariff reviews to make sure you’re on the optimum tariff for your business and aren’t paying more than you should, budget estimates so you can plan with certainty and desktop energy audits to help you minimise your consumption of energy, but one of the most useful parts is its bill validation service.
Here we look through every item of every bill that you receive and confirm that it has been calculated correctly. We independently check the rates, we independently check the consumption and we also check the calculation of the dollar figures on your bill. Because we have the details of your energy contract, and because we get your meter readings directly from the metering agent, not from the retailer, we can identify very quickly is anything is amiss. We can do this because we’ve built a business on doing just that, and our processes are automated, which takes the human element out of the result.
It can be particularly hard to validate your electricity bill, made more difficult when you have sites in many different states and under multiple contracts with prices that differ across them all. With billing being monthly you don’t have to be a very big business at all before you’re looking at hundreds of bills a year. In practice it’s impossible to check these yourself with any reliability and most companies don’t. You just end up looking back at year end and comparing what you spent to what you spent in the previous year and making an adjustment for any sites that have opened or closed in the meantime. That’s not very reliable.
When you consider that a small manufacturing site, agricultural producer with livestock sheds or hospital may be paying around $250,000 a year for its electricity, it doesn’t take much of an error for it to hurt. Then multiply that across a dozen or so sites. The error can easily be in the tens to hundreds of thousands of dollars. We’ve even seen errors of over $1 million.
And making it even harder is the fact that the electricity component of the bill has doubled over the last three years, so businesses coming to the end of their contracts are having to come to terms with huge increases.
As a CFO you need to know that you’re getting everything from your energy contract that you’re paying for, and aren’t paying the highest prices that we’ve ever seen in Australia for something that you’re not getting. This is where the Energy Metrics service comes in – an important tool for anyone in finance to understand and take control of their energy spend.
Find out more about Energy Metrics here and contact our team today if you want more information.