Water delivers second-lowest satisfaction to small Scots businesses

(by Karma Loveday)

Small businesses in Scotland ranked water as the sector they are second-to-least satisfied with (see chart), in a survey by Consumer Scotland.

The watchdog surveyed 700 small businesses (those with under 50 employees) about their engagement in and satisfaction with various services, from utilities to building and professional services. Key findings included: 

• Small businesses are just as likely as individual consumers — and in some cases, more likely — to experience problems when purchasing goods and services. Nearly half of those surveyed reported problems including unclear contract terms, poor service quality and delivery failures.

• Despite this, small businesses often have lower levels of legal protection, fewer rights and less access to advice and redress than individual consumers.

• Satisfaction levels vary significantly across markets, with energy, water and telecoms performing worst out of 11 markets studied. Energy market dissatisfaction was particularly pronounced, with one in five businesses reporting problems including contacting energy suppliers, understanding bills and unfair terms and conditions. 

• A particular issue in the energy market was reliance on Third Party Intermediaries (TPIs) to secure contracts, with examples of mis-selling and misrepresentation or products, inconsistent approaches to consumer protection, poor customer service and lack of access to dispute resolution.

Consumer Scotland pointed out that dissatisfaction in the energy, water and telecoms markets can have a direct impact on performance, including turnover and profitability. This is relevant for growth, as small businesses are vital to Scotland’s economy. The country has around 350,000 small businesses, employing over 900,000 people.

The report recommended: 

• Raising standards in the energy and water sectors by enforcing protections and strengthening regulation of TPIs. 

• The Scottish Government to work with small business representatives and consumer advocacy and advice bodies to improve access to consumer and contract law information.

• Regulators to put in place enhanced monitoring of the issues faced by small businesses, including complaints data, to identify improvements.

• Regulators to regularly review the effectiveness of the information provided to small businesses to ensure it meets their needs.