Press
Mortgage Strategy 05th Feb 2007
Broker cashes in on utilities
A Welsh broker says he is expanding his revenue stream by saving customers money on their utility bills.
John Bowden, proprietor of The Better Mortgage Shop in Colwyn Bay, has joined forces with Utility Warehouse, part of Telecom Plus. Utility Warehouse uses the collective buying power of multiple small users to negotiate bulk buying with major suppliers.
After sourcing the most competitive deal on anything from electricity to internet providers, it negotiates wholesale discounts that regulator Ofcom and Ofgem estimates saves customers £491 a year. As an independent distributor for the firm, Bowden receives commission of up to £45 for each customer he refers, as well as 4.8% to 6.3% of the customer's bill every month.
He says: "For brokers, the regulation burden on traditional residual income from bolt-on, one-off products such as buildings insurance means more time spent paper chasing. By referring customers to Utility Warehouse, not only do I make commission, but I also save them money.
"This can encourage them to buy other products because of the cash they save."
Bowden believes utility bills are a previously unconsidered aspect of financial planning. He urges other brokers to consider joining up.
He adds: "Clients place their major bills in order of mortgage, energy and telephony, with more pressure on energy costs than ever before. We know we can cut all of these dramatically."
James Carter, principal of Independent James, says: "This idea sounds great. Anything that adds value to the services you offer is a good thing but it would depend on how heavy the administrative burden of the scheme is."
Bowden says referring a customer only requires a single application form, so it can be done quickly by brokers.