Water firm tapping into Scots growth

A national water retailer formed through a joint venture is looking to grow its team in Scotland and launch a specific Scottish brand as it targets growth both north and south of the Border.

Donnelly says Wave favours controlled growth at a sensible margin. Picture: James Fullarton.

The creation of Wave – a 50:50 JV between Anglian Water Business and NWG Business – was announced towards the end of last year, and it provides water and wastewater services to more than 300,000 businesses across the UK. It also operates the Scottish Government contract for water metering and billing to 200 public bodies from its Scottish base in Edinburgh.

Wave employs 20 people there, and “certainly in the short term I could see another six jobs easily coming along,” Wave chairman Tony Donnelly told The Scotsman.

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“As we keep growing the business, more and more we will look to increase the amount of people directly working for us.”

He said it has been a “very pleasing” first year for the organisation, which has become the second-largest water retailer in both Scotland and the UK with a market share of about 25 per cent and 20 per cent respectively. It has also generated £550 million in turnover in 2017/18, £81m of which was in Scotland.

Since 1 April 2017, it has secured more than £51m of new private sector business wins, of which £2.5m are from Scottish customers.

Key contracts include Savills, Asda, Betfred, Malmaison, Hotel du Vin, MRH Retail, RoadChef, Pure Gym and Holland & Barrett.

It also recently added Travelodge to its books in a two-year contract worth £400,000 across about 55 sites in Scotland, and about £4.2m across 400 sites in England.

As for the public sector, Wave has delivered nearly £3m in annual savings to the Scottish Government – equating to about 390 Olympic swimming pools – in addition to the £4m or so a year promised when the contract was inked. Additionally, that contract was extended by 12 months to March 2020.

Donnelly noted that Wave is hopeful of being reappointed, although he expects the process to be highly competitive, with interest from Scottish Water unit Business Stream and many English retailers.

“But we most certainly will be very keen to bid on it… . It would be one of our absolute focuses over the next couple of years to seek to retain that.”

That public sector deal has also paved the way for the forthcoming launch of a Wave Scotland brand, a move Donnelly said is to “give Wave a very clear Scottish presence in the marketplace”.

The firm has also won several public sector deals south of the Border, is targeting the SME sector particularly in Scotland, and is looking at diversifying its offering to enable consumers to also get gas and electricity from one supplier.

Efforts are under way to not only grow in scale but be “one of the more creative, more innovative players – and that our product offering continues to widen and is in keeping with what customers are attracted to”.

He added: “[It’s not] growth at any cost to us – it’s about controlled growth at a sensible margin that allows us to be sustainable, to keep progressing.” The UK water retail market is worth some £3.5 billion.