Inenco Direct - anyone heard of them? need to beware?

Hoof_Hearted

Bluebirdman_of_Alcathays wrote: »

As an aside, if your consultancy don't charge commission when you broker contracts, why bother doing it at all?

We don't really want to be bothered with energy purchasing but if we are doing huge energy audits (and we only deal with very large premises), we may do purchasing as part of the audit to see what prices could be achieved. I guess the purchasing aspect is rolled up in the fee.

Currently, gas tariffs are around 2p per kWh. Some unscrupulous brokers may add .5p commission for their free service.

Bluebirdman_of_Alcathays

Hoof_Hearted wrote: »

We don't really want to be bothered with energy purchasing but if we are doing huge energy audits (and we only deal with very large premises), we may do purchasing as part of the audit to see what prices could be achieved. I guess the purchasing aspect is rolled up in the fee.

Currently, gas tariffs are around 2p per kWh. Some unscrupulous brokers may add .5p commission for their free service.

For site additions to large existing portfolios, I've known brokers add £10/MWh (or more) for their service.

Nevertheless, I don't think that means that they are poor value as a rule.

Hoof_Hearted

That is 1p per kWh.

Domestically, I use 25,000 kWh gas and 5,500 kWh electricity.

30,500 x 1p = £305 addition to my bills. Imagine how much additional cost this would be for a company using 100 times this! However, it happens all the time that companies are paying tens of thousands of pounds to brokers for what is a couple of day's work.

Bluebirdman_of_Alcathays

Hoof_Hearted wrote: »

That is 1p per kWh.

Domestically, I use 25,000 kWh gas and 5,500 kWh electricity.

30,500 x 1p = £305 addition to my bills. Imagine how much additional cost this would be for a company using 100 times this! However, it happens all the time that companies are paying tens of thousands of pounds to brokers for what is a couple of day's work.

That is indeed 1 p/KWh - although as I said it was on a site-add to a large portfolio, so your comparison is completely flawed.

I'm no fan of brokers, but to decry them as completely superfluous is short-sighted - in the domestic market price comp sites are a virus, but sadly, a necessary one.

Hoof_Hearted

Believe me, I know the industry. Brokers can be useful but some are too greedy. Perhaps the industry would be better if brokers had to declare their commission earnings to the customer.

One of our customers, a big London office block, uses approx. 1,250,000 kWh of gas and 250,000 kWh of electricity a year. Your 1p broker would earn £15,000 for procuring their energy. I know, because I do it, it is two day's work. That is why I would discourage the OP from using a broker without knowing the charges.

TheHardTruth

The LOA Ineco Direct have sent you acts as a permission slip for them to speak to your supplier and gather the relevant information to quote you on your energy or gas.

Inenco Direct actively opt into governing bodies to help regulate the energy broker market to help stop customers being done by 'bedroom brokers'

As per their website, they have been going for years and have had growth during two recessions, whilst still supplying services to large corporate companies like M&S and Santander.

Personally any time i use a third party I ask them for testimonials, because that is a true reflection of the customer service.

I wouldn't worry about the LOA,it may be worth giving them a go seeing as the market is so competitive these days.

Hope this helps

mamapapaxp

I was looking on google for the contact number of a former colleague and stumbled upon this thread. I registered solely (at least for now...) to put in my two pence worth...

I used to work at Inenco Direct, until September of 2014 and can answer a couple of questions right here and, if necessary, any raised later...

Firstly, Inenco Direct is, just like any business in this day and age, solely in it for the money. That being said, for the six months I was there as one of these 'evil' sales guys, I experienced a number of practices.

Let me say, up front, that their good reputation is earned. In training, it is made clear that we should not lie or cheat or bring the company and the broker industry into disrepute.

Modern employers being what they are, however, means that hungry [STRIKE]brokers[/STRIKE] salesmen will often come to Inenco (with its good pay) from a brokerage with no morals and lower pay and bring some 'practices' with them. Not all, but a few. And, if their direct manager sees them making money, they probably won't look too closely. As in all environments such as these, only the 'Sharks' survive, which is why I am now between opportunities.

So, what to do? Firstly, don't dismiss them out of hand. Because of their long and storied history and the volume of business they bring to the energy generators, they are able to negotiate prices that are, genuinely, unbelievable. Sometimes, a third of what you may previously have been paying.

Each generator then allows a different maximum of commission to be added on, BEFORE YOU GET TO SEE THE TRUE RATE.
This might seem really unfair but think about this:

• 1. No matter how hard you try, (and why should you when a broker can do it for you...) you are unlikely to be able to squeeze your generator (or the new one being proposed) to offer the same price as you have been offered. (Only the biggest of customers, who usually have people employed for the purpose, can scare them into caving.) In fact, most generators, once a quote has been obtained via a broker, will promise them not to sell to you behind their back anyway.

• 2. Whilst it cannot be guaranteed that your tariff will reduce, you are - no matter how much commission has been added - likely to still be better off than if you had allowed yourself to 'roll-over' or attempted to negotiate directly. (Do you want to contact twenty different generators to get the best price? Most price comparison sites - even for businesses - don't get that much exposure and still only list published rates.)

• 3. Brokers can leverage advance buying rates, by as much as a year ahead of when your current contract expires. (You don't pay a penny until the supply begins, but you may get to lock them down when prices are especially low.) The prices are usually much better because the generator can plan their own purchasing ahead of time instead of responding to short-term demand. This may seem like a gamble but prices almost always creep upwards, eventually, especially over the course of a year or so and events such as the crisis in the Ukraine can, if allowed to get out of hand, skyrocket prices at the most inconvenient of times.

This all sounds like i'm trying to sell you the product (and get my job back) but i'm not, there are still caveats;

Make sure you let the broker know you are fully aware of his commission. That you are okay with it but not to take the mick.
It is right that commission be earned, and what seems like a lot, often isn't. (Although they always live for the BIG one, which I saw happen a few times.)

As an example; your previous year's bills from British Gas indicate you used 5,000 units of electricity at, say, 16p per unit. ( A gross oversimplification, as there are of course other charges, also don't be freaked by the 16p. Tariffs change depending on how much you use, how far away from the power station you are and where in the country you are.)

The broker's best deals are:
a) EDF Energy 1 year fixed at 9p but with maximum available 5p commission.
b) BG 3 year fixed at 11p but commission capped to 2.5p and
c) BG 4 year fixed at 11.75, commission capped to 2.5p

These are pure examples (I can't remember caps and they probably changed by now...)

The broker stands to make:
a) 5000 x 0.05 = £250
b) 5000 x 0.025 x 3 years = £375
c) 5000 x 0.025 x 4 years = £500... heck, he could knock the commission down to just 2p and still make £400.

Oh, and bear in mind the actual sales guy will probably only get between 10% and 25% of this amount for themselves... (say £50 - £100...) Sales do not come thick and fast and, while their next sale could be the rare 'million units at 4p' the odds are this could be one of only 5-10 similar sized deals made in the week... Just putting that one out there.

So what to do with the choice presented? (If they present you with a choice, if not, insist on some variety, repeat that you know how this works...)

All the prices in this example are clearly better than last years prices, although even being offered the same 16p could be considered a 'saving' given inflation etc...

They will, like as not, try to push you into the longest deal possible, (unless a shorter one has better commission possibility, which happens too.) It's up to you. Longer terms mean you can weather a changing economy with a fixed price but it may also mean a bumpy jolt back to more normal tariffs some years later... (See if your broker can pull rabbits again...) It also means you don't have to put up with re-broking for a while...

Once a tariff has been agreed, the broker has a fair bit of work to possibly terminate one provider and get contracts to the next and they often won't get paid until the contract is finalised (by actually beginning) which, of course, could be up to a year away! So, as 'evil' as you may think some of them are, (and some of them certainly seem to be without scruples... or a soul,) make them earn their commission, DON'T ACCEPT THE FIRST FIGURE YOU ARE GIVEN, as this will probably have the maximum commission on it, heck, don't accept their second offer either.

They may try to play hardball and say they can't get the supplier to reduce the price any more and may even 'go away', but if you've indicated there's a possible sale in it for them...
THEY'LL BE BACK!

Oh, and the Letter of Authority is nothing to be afraid of, although there are two versions. The LOA1 only allows them to make enquiries into your account history and serve NOTICE of INTENT to TERMINATE on your behalf. (but only at the time your contract is due to terminate anyway.) This stops you 'rolling-over' into default rates, which are sky-high.

The LOA2 is used by bigger customers, with whom a good relationship has been established, and allows the broker to negotiate and sign the contracts on their behalf... you shouldn't be receiving that one but just check to be sure.

Hopefully I haven't bored to death the few people still left reading with what I remember.
It was fun working there, and there are lots of good people working to earn a living AND serve their customers but, to be safe, IT'S UP TO YOU TO MAKE SURE THEY ARE... KEEP THEM ON THEIR TOES...

Whistle_Blower_3

As this post says, despite what they have told you, that they want save you money, the truth is that inenco direct ( and others like them) only want to make money (for themselves) from changing your contract. Inenco direct are very good at making money.
A high percentage of brokers push the deal that gives them the best commission.
Here is a fact.
There are many portals out there, mostly run by the energy providers, but whether you are a private consumer or a small to medium enterprise take a look at the energylinx portals (energylinx.co.uk or energylinxforbusiness.co.uk ) and see how easy it is to do it yourself.
Whether you are a small nursery or a small factory there are savings to be had.
Approx 60% of energy suppliers use the energylinx portal (customised to look their own) but the process and the search engine belongs to energylinx.
I used it and saved £310.00
That's better is your pocket than in Inenco's!!!

Whistle_Blower_3

As this post says, despite what they have told you, that they want save you money, the truth is that inenco direct ( and others like them) only want to make money off of changing your contract. Inenco direct are very good at making money.
Here is a fact.
There are many portals out there, mostly run by the energy providers, but whether you are a private consumer or a small to medium enterprise take a look at the energylinext portals (energylinx.co.uk or energylinxfor business.co.uk ) and see how easy it is to do it yourself.
Approx 60% of supplier use the energylinx portal (customised to look their own) but the process and the search engine belongs to energy linz.
I used it and save approx £410.00
That's better is your pocket than in Inenco's!!!