With more than 70 gas and electricity suppliers out there, it’s hard to know whether or not the supplier offering you great prices is too good to be true. Will they be able to stay afloat in a tough and competitive market?
When suppliers go under, like Extra Energy and Economy Energy, customers lose their agreed rates and their details are sold on to another supplier, under the premise that they’re offered a new contract with new rates based on the current market.
Why are smaller suppliers able to offer cheaper prices?
- Being exempt for ECO (Energy Company Obligation) that the Government applies to larger suppliers.
- Lower overheads due to less experienced long-term staff
What are the risks of using a smaller supplier?
- The lack of reviews mean you could end up with a poor experience
- Poor switching experience
- Inexperienced customer service teams could make it harder to handle any problems you come across.
- Risk of the financial viability of a company may mean that an unexpected cost could cause the company to go bust – leaving you without a supplier
- Inexperienced pricing teams could under-forecast third-party costs leaving you with a large unexpected reconciliation bill.
- Terms and conditions that may not make it as clear to you about what you’re signing
At the end of the day, we’re only here to give you advice so that you can come to your own decision. We only offer contracts with tried and trusted suppliers (though they don’t get it right 100% of the time) but can understand why it is tempting to take the cheaper prices being dangled in front of you, it’s only human – especially if they’re throwing in perks such as vouchers. What we always say is that if it sounds too good to be true, then it probably is and if what you’re offering needs all of the extra frilly bits to sell, is it really that good?