Many business owners view their utility bills as a fact of life and think that utility companies can dictate the charges however they want. While it is true that there’s no way around paying your company’s utility bills, you can focus on lowering them as much as possible.
Utility expense reduction, more commonly known as utility bill management, can help you ensure that you’re being charged the correct amount for the services you receive and that you’re taking advantage of any available discounts. If you’re new to the idea of utility billing management, keep reading to learn how you can get your business’s utility spending under control.
Utility bill management is a process where businesses aim to better control utility invoicing by streamlining the procedures for collecting bills, validating charges, and submitting payments for all business-related utility accounts. By having better control over utility bill processing, companies can save massive amounts of money each month by catching errors and overcharges that routinely show up.
On top of saving money and streamlining processes, utility billing management can also help companies track usage, improve utility procurement processes, and budget for the future. Businesses typically have at least four utility providers, and those with multiple physical locations can see this number multiply quickly.
Utility expense management can become overwhelming for even the most experienced Accounts Payables teams. Most employees don’t have in-depth expert training to navigate highly complex tariffs and fees that show up on invoices. Without specialized knowledge, it’s easy for errors to be overlooked and paid out of your business’s pocket. That’s why the most logical decision is to outsource the process to a third party that offers utility bill management services.
Every type of business can benefit from utility expense management, sometimes referred to as utility cost management. However, organizations with many physical locations tend to have even more utility accounts to monitor and may benefit the most. Utility cost management can be especially helpful for organizations looking to strategize their energy management or focus on sustainability.
Utility expense management companies handle utility invoicing from receipt all the way to payment. Rather than just paying the amount due, these companies run quality controls to validate invoices and confirm accuracy. This is often accomplished using complex utility bill management software. They also keep track of late or missing invoices to ensure no late payments are incurred by their clients.
On top of processing invoices, utility expense management companies offer valuable accounting data that can help your business manage commodity usage and plan financials. The data captured can be broken down to help you locate high consumption and costs and uncover areas for improvement.
There are three main aspects of utility bill management:
Scanning invoices as soon as they’re received and automating processing can help companies in multiple ways. If there are any missing bills, your business will be alerted right away, helping to prevent unnecessary late fees. In addition, invoices will be processed in the order in which they are due.
The most significant way utility expense management companies save businesses money is by monitoring for errors. Billing issues can appear in various forms and are often hard to locate, so identifying and resolving these issues is critical. Examples of types of mistakes that are commonly found on utility invoices include:
Another vital utility bill management service is providing strategic reporting of consumption and costs. Utility bill management software can offer forecasting tools, trend analysis, and comparisons from facility to facility or year to year.
Did some of the terms listed under common invoicing errors make your head spin? That’s because the terminology, tariffs, taxes, and fees used by these utility companies are incredibly complex. That’s a major reason your business may benefit from help with utility cost management.
Some benefits of utility expense management are:
There are many utility expense management companies out there that are ready to take control of processing utility invoices for your company. However, companies offering utility bill management services come at a premium. Many charge an initial set-up fee as well as monthly processing fees, which can get drastically higher the more invoices you need processed.
If spending money to save money isn’t your cup of tea, there are other options for you. As a cost reduction firm, P3 Cost Analysts have years of experience reducing utility costs for businesses across various industries. While our process varies slightly from utility expense management companies, the end goal is to save your business money, time, and headache. And we do it all with no upfront out-of-pocket costs.
The P3 utility cost reduction process works by doing an in-depth audit of your business’s utility invoices, locating the errors, and making recommendations to find savings. This process can go back up to 12 to 36 months, depending on your state. Our experts scour your invoices line by line to find any overcharges or errors where the utility company owes you a refund. We also check the many tariff options that can impact your cost per kilowatt hour. Once we’re caught up on past invoices, we will continue to audit each incoming bill to keep utility companies in check.
Our experts have the experience and expertise to locate savings that your Accounts Payable team may not catch. Even businesses that think that they have invoice monitoring under control can benefit from our services. If you’re interested in ensuring that the utility companies you work with are correctly billing you, schedule a free expense audit with a utility expert at P3 Cost Analysts.
Utility bill management can be an extremely valuable service for businesses of all sizes. By working with a company specializing in this area, you can simplify utility invoicing in all aspects, from processing to validating and tracking.
While utility bill management services may offer a lot, they come at a price. Another option is to work with a cost reduction firm like P3 Cost Analyst. You will still save your business money and countless work hours without significant upfront costs.
If you’re interested in learning more about how utility auditing could benefit your business, schedule an expense audit with us today. We would be happy to discuss the options available to you and help get your business on the path to saving money!