Technology has come a long way to simplify life for energy brokers. While there are numerous applications and platforms, many are quite different in their approach to helping brokers. Do you know which one is right for you? In this blog we will investigate the differences between choosing between an Aggregator (Broker of Brokers Solution – BoB) or a Software as a Service (SaaS) model.
#1 (by far) Energy Brokerage Management Software
Sparkplug is the #1 retail energy sales platform in the world, powering over 10% of all B2B transactions across the US energy retail market with bespoke technology & software solutions to SME Brokers, I&C Consultants, TPI’s, Broker Aggregators and Energy Suppliers.
Exploring BoB and SaaS
Aggregator – Broker of Broker model
If you are the owner of a TPI shop, you started your business to “own your own business”, pouring blood, sweat, and tears to help it grow. You did not start your business to simply work for someone else.
Did you know that many of the broker solutions on the market are owned by or associated with a broker who competes against you? BoB platforms are TPIs that have developed software to help grow their business and let you use it while taking percentages of commissions.
Most importantly, when your customer signs the energy contract you worked so hard to close, you are nothing more than a sub-agent to that other broker. Did you know that they are the broker of record? That means supplier payments first go to your platform provider (and you hope they pay your commissions promptly and correctly). We have also heard that in some cases aggregators amend the payment terms to their sub-brokers rather than immediately paying them when they receive their supplier commissions. Furthermore, what happens to your data upon renewal if you are no longer on the platform? Can they renew your customer and cut you out of the loop?
If you want to sell for a competing TPI, lose control of your own destiny, lose the protection of your company brand, this is likely the right solution path for you.
BYOB – SaaS model
If you want to “Be Your Own Broker” (or BYOB) and not work for another broker, you need to seek out a platform provider that works for you.
Platforms such as these are often developed by technology companies with a deep understanding of the industry. Their expertise and focus are on providing the best-in-class solution that offers the tools and efficiencies to streamline and grow your business.
Being a pureplay solution provider helps establish trust and eliminates conflicts of interest while ensuring that YOU own your customer data. There is never a fear that the provider will take your customer information and use it to their own advantage.
Financial illustration:
Aggregator model – BoB Solution is charging 20% on deals
Saas Solution subscription costs £400 / month. Sparkplug example – 5 users, 15 suppliers, and 5 referral partners
Broker has an average margin of £3/MWh
The average Deal Size is 500 MWh annually
If the broker has 50 deals and later grows to 150 deals/3 users, the following indicates the differences between the two solutions. At 50 deals, the difference a SaaS model would save is £10,200 annually, and at 150 deals – a SaaS model saves £40,200
Conclusion
At Enerex, we are in the business of providing the best industry solution on the market that works for you, not against you. Our team of over 100 employees has the deep retail industry knowledge and continuously pushes the marketplace with innovative solutions. With Enerex, you get an established company with the largest broker customer base in the market that has been a trusted industry provider since 2007.
Here are a few of our recent accolades:
- “1st and only” data platform for connecting the retail energy market in the US
- #1443 on the 2021 Inc. 5000 “Fastest-growing, privately-owned company list”
- 130+ broker customers across the US and UK energy markets
- Inc. 5000’s 23rd fastest-growing energy company in 2021
#1 (by far) Energy Brokerage Management Software
Sparkplug is the #1 retail energy sales platform in the world, powering over 10% of all B2B transactions across the US energy retail market with bespoke technology & software solutions to SME Brokers, I&C Consultants, TPI’s, Broker Aggregators and Energy Suppliers.
