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c
Three things
manufacturers can
do to mitigate risk.
c
Manufacturers must constantly review
forecasted vs. contracted or bought volume
and taking mitigation against any over- or
underhedged calculations. This will help
reduce the risk of energy buy-back and the
various fines that come with it.
Energy prices Pricing have been very
competitive for most of 2020, with a huge dip
in the market as a result of lower economic
activity. Prices have risen again recently, but
we expect to see more volatility moving into
2021. It is important to balance volume risk
and price risk. The right procurement strategy
enables companies to find a good long-term
deal while managing volume on an ongoing
basis.
The right credit contract in place will enable
you to better tailor utility procurement to the
needs of your business. Suppliers are being
more stringent around who they give credit to
– so it’s important for you or your consultant
to build a strong relationship with a supplier.
Manufacturers should also be aware of the
clauses that suppliers have recently relied on
to claw back money. Choosing the right
supplier isn’t just a financial decision, but a
contractual one: it’s vital to understand the
clauses in the contract that may affect your
business.
c
To find out more about
Inenco’s services call us
on 01253 785 294.

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Three things to mitigate risk

  • 2. c Manufacturers must constantly review forecasted vs. contracted or bought volume and taking mitigation against any over- or underhedged calculations. This will help reduce the risk of energy buy-back and the various fines that come with it.
  • 3. Energy prices Pricing have been very competitive for most of 2020, with a huge dip in the market as a result of lower economic activity. Prices have risen again recently, but we expect to see more volatility moving into 2021. It is important to balance volume risk and price risk. The right procurement strategy enables companies to find a good long-term deal while managing volume on an ongoing basis.
  • 4. The right credit contract in place will enable you to better tailor utility procurement to the needs of your business. Suppliers are being more stringent around who they give credit to – so it’s important for you or your consultant to build a strong relationship with a supplier. Manufacturers should also be aware of the clauses that suppliers have recently relied on to claw back money. Choosing the right supplier isn’t just a financial decision, but a contractual one: it’s vital to understand the clauses in the contract that may affect your business.
  • 5. c To find out more about Inenco’s services call us on 01253 785 294.

Editor's Notes

  1. Speaking regularly to customers about energy efficiency, cost reduction and process optimisation we’ve observed that our conversations have changed. While discussions were once focused almost entirely on the price of energy, they have since changed to embrace overall cost and an increasing focus on consumption optimisation. But in the last year what we are hearing from our clients’ boardrooms is a far more integrated focus on sustainability, with increasing awareness of the changing aspirations of consumers, supply partners and investors alike. We wanted to investigate this further, so in December 2019 we launched a survey to understand the awareness and strategic importance of sustainability within organisations. What we’ve found is that while organisations are well aware of the increasing importance of sustainability, they don’t necessarily feel equipped to respond strategically to the relevant challenges relating to people, processes and technology.
  2. Speaking regularly to customers about energy efficiency, cost reduction and process optimisation we’ve observed that our conversations have changed. While discussions were once focused almost entirely on the price of energy, they have since changed to embrace overall cost and an increasing focus on consumption optimisation. But in the last year what we are hearing from our clients’ boardrooms is a far more integrated focus on sustainability, with increasing awareness of the changing aspirations of consumers, supply partners and investors alike. We wanted to investigate this further, so in December 2019 we launched a survey to understand the awareness and strategic importance of sustainability within organisations. What we’ve found is that while organisations are well aware of the increasing importance of sustainability, they don’t necessarily feel equipped to respond strategically to the relevant challenges relating to people, processes and technology.
  3. Speaking regularly to customers about energy efficiency, cost reduction and process optimisation we’ve observed that our conversations have changed. While discussions were once focused almost entirely on the price of energy, they have since changed to embrace overall cost and an increasing focus on consumption optimisation. But in the last year what we are hearing from our clients’ boardrooms is a far more integrated focus on sustainability, with increasing awareness of the changing aspirations of consumers, supply partners and investors alike. We wanted to investigate this further, so in December 2019 we launched a survey to understand the awareness and strategic importance of sustainability within organisations. What we’ve found is that while organisations are well aware of the increasing importance of sustainability, they don’t necessarily feel equipped to respond strategically to the relevant challenges relating to people, processes and technology.