The nation’s largest businesses, industrials and commercial companies with multiple locations and a recognized national brand, plan to drastically cut the number of natural gas and power suppliers that they deal with by between 65% and 93% as part of a move to streamline their supply chain, according to a survey by RKS Research & Consulting.

“Walmart has kind of set the pace. The companies want to simplify and bring it down to just one nationwide deal,” said Dick Claeys, Vice President of RKS West, based in Santa Clara, CA. As for suppliers “if you missed short list, that’s a lot of business to lose.” Some of the companies have as many as 2,200 outlets across the country.

For example, commercial national accounts — such as the nation’s major chain stores, grocery, convenience and specialty retailers, restaurants and hotels — intend to deal with a short list of six power suppliers, down from the present roster of 88, a projected drop of 93%. Likewise, these same customers expect to reduce their natural gas providers from 44 to five sources, an 88% reduction, according to the survey by the consulting firm with home offices in North Salem, NY.

North America’s largest industrial customers forecast similar trends, with plans to deal with no more than three electric and four gas suppliers — reductions ranging from 65 to 75%. “As these trends continue, the resulting consolidation of suppliers could affect more than 25% of current energy industry revenues from commercial customers, plus an additional 15% paid by industrial customers,” RKS said.

“From these findings, it’s clear that these large and demanding national accounts are looking for a long-term relationship with far fewer suppliers,” said David J. Reichman, RKS chairman and CEO. “While cost savings remain an important criterion, headquarters energy managers at these major firms now tell us that a responsive single point of contact, an assured supply of energy, and a strong financial profile will be the key factors in winning or losing their business in the post-Enron marketplace.”

Clear majorities among these large energy users, 80%, can now choose their electric and gas suppliers, according to the survey. Already, more than one in five have switched 75% or more of their dispersed locations to new energy providers. At the same time, respondents register low levels of satisfaction with both electricity and gas deregulation, and express reservations about the process and ultimate benefits of deregulating energy markets, the RKS survey showed.

Some of the most-often mentioned suppliers included Duke Energy, Centerpoint Energy, TXU Energy, Southern Co., FirstEnergy, Select, and Entergy, Claeys said.

These results highlight the sixth major survey of national accounts customers conducted by RKS Research & Consulting, a nationwide market research and public opinion polling firm. RKS used both on-line and telephone interviews, to gather data from 200 headquarters energy managers responsible for 180,000 separate places of business throughout North America.

The firms represented in this survey account for $5.4 billion in annual electricity expenditures, plus another $2.6 billion a year for natural gas. Subsequent focus groups will involve some of these respondents in exploring the results and key themes in greater detail.

The latest RKS survey also finds national accounts increasingly active in energy efficiency. For instance, half these major businesses report increased spending on efficiency programs over the past two years, with 2002 expenditures alone estimated at some $200 million. Further information can be found at: www.rksresearch.com.

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