Wednesday 25 April, 2012
By Martin Fagan
Anxiety of the unknown prevents many consumers from moving to smaller energy suppliers, says research.
Despite a lack of trust and confidence in the “big six” energy suppliers, and smaller energy companies providing a viable and cost-effective alternative, just 52% of Brits would switch to one.
New research from independent switching service uSwitch.com shows consumers could be losing out on savings of “at least £337million” on household energy bills by not switching to one of the smaller suppliers.
And while 19% are content to stick with the “big six” because they are happy with their current supplier, fear factors are preventing many more from moving away.
Over three-quarters of consumers (77%) would consider moving to a smaller supplier to get cheaper energy prices, while 32% would switch for better customer service and 28% would switch to get clearer bills, even though these are the very benefits smaller companies can offer.
However, the research by uSwitch.com shows that concerns about the size and financial security of these smaller players are holding consumers back.
The website says the biggest fear preventing consumers moving to a smaller supplier is the worry it could go out of business - 35% of consumers say this concern would stop them from switching. Almost 30% would be frightened of losing their supply if something went wrong with the company, while 22% wouldn't trust a supplier they hadn't heard of.
However, uSwitch.com says small suppliers are also battling against the negative perceptions that dog the energy industry as a whole. It found that 15% of people wouldn't bother switching to a smaller supplier because “better the devil you know”, while 12% believe all suppliers are the same regardless of size.
"When it comes to energy suppliers, many consumers are caught in a trap: they're unhappy with the ‘big six’, they like what smaller suppliers have to offer, but they're too frightened to try one out,” said Ann Robinson, director at uSwitch.com.
“But their fears are completely unfounded and could easily be laid to rest with the right education and reassurance. This would allow consumers to enjoy far more choice.
"The fact is smaller suppliers offer competitive prices and a genuine alternative to being with the ‘big six’ and consumers will be losing out if unfounded fears prevent them from snapping up such deals.
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