VIKRON Energy Solutions

Instead of becoming victims of the common corporate downsizing, co-workers Kathi Wagner and Jeff Weymouth decided they could put their 38 years of combined experience in the natural gas industry to good use by founding a company of their own. During the 15-month transition from their former marketing company, the pair realized that Wagner's account management background – in which she built relationships with all of the utilities in Michigan – combined with her knowledge of tariffs, would compliment Weymouth's skills negotiating with producers and suppliers of gas. Wagner, vice president of VIKRON Energy Solutions in Traverse City, sat down with the TCBN to describe the industry and how she and Weymouth, company president, work as a team to help clients manage their risk exposure, gas costs and keep their business' energy costs as efficient as possible.

Industry

We're in the unregulated natural gas industry and assist large commercial and industrial users (generally consumers of more than 20,000 to 25,000 Mcf of gas per year) with the procurement of their natural gas supply. We provide our services to several types of large volume users of natural gas who benefit from being on the Transportation Service Rate with the utility. The distribution charges are less per unit, and the cost of the physical gas is usually less buying from a supplier instead of directly from the utility.

How it Works

We have a network of gas suppliers that we work with, plus real time pricing tools, and we know where the market prices are to get a fair price for our clients. We also offer different risk-management strategies, depending on their risk tolerance. We help with budget planning and provide account

management, allowing our clients to focus on their own business while having the benefit of our products and services at a fraction of the cost of employing a full-time energy team.

Professional Guidance

The first thing we did was take the "Starting a Business in Northern Michigan" class through the SBTDC (Small Business Technology Development Center). We have been working with SCORE from the very beginning, and it assisted with our business plan, including structuring, financial projections, cash flow and our marketing business approach, and provided us with list of contact people for services such as bankers, lawyers, accounting firms, IT support and website design.

Challenges

Since market deregulation – down to residential and small accounts – there are so many marketing companies that have call centers that flood the market with phone calls. It sometimes makes it difficult to get through to the right person we need to talk to. Even though we are able to provide them a cost savings, many clients have a loyal relationship with their current supplier, and it's not easy to get them to change.

Clients

We serve large natural gas users, such as school districts, universities, hospitals, manufacturing companies, and property management companies. We are very pleased to have just recently signed up a very large client in the southeast Michigan area. We are estimating a cost savings for them this year of more than $100,000. In addition to the cost savings, we were able to offer them great payment terms too.

Cost

Our fees are on a case-by-case basis. Our fees are transparent. The net result of having us buy for them is a cost savings to our customers – not only on the physical cost of gas by aligning them directly with a supplier and doing the negotiating on their behalf – but also, our fees are considerably less than large marketing companies. We are not out to sell them as much gas as we can.

Goals

Our company goal is to provide value, flexibility and quality service to all our clients, regardless of size. Even though we're small, we feel we're positioned to take on large, complex requirements and can provide the type of personalized service our clients are looking for. Our goal isn't to get as many accounts as we can, but rather to have a book of business that we can comfortably manage and proactively look out for our clients' best interest in every aspect of the gas industry.

Learn More

Web: vikronenergy.com.

E-mail: Kathi Wagner at

kwagner@vikronenergy.com, 231.228.2778;

Jeff Weymooth at

jweymouth@vikronenergy.com, 231.932.8711.

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