Telecom Plus, a FTSE 250 company, established Utility Warehouse in 2002 as a subsidiary and brand to encompass all of their residential energy, telephony and broadband offerings. In 2006, UW and Telecom Plus entered into an agreement with npower, under which npower would supply energy to UW customers. UW sold its two subsidiaries to npower. In 2013, however, npower sold the two former Telecom Plus subsidiaries back to Utility Warehouse for £218 million. As a result, Utility Warehouse became one of the largest independent energy suppliers in the UK. The deal sparked commentary about the possibility of npower's parent company RWE leaving the UK, or the emergence of a "Big Seven" in place of the existing Big Six energy suppliers.
Operations
Utility Warehouse employs a multi-level marketing model that utilizes independent distributors to obtain new customers. Distributors introduce both residential and business customers. The Utility Warehouse headquarters is in Colindale, North London. The company supplies gas, electricity, broadband, mobile and landline telephony, and home insurance. Their telephony and energy services are often bundled to reduce costs for customers. In 2018, the company came seventh out of thirty companies in the Which? energy customer survey, with high scores for onlinecustomer service and value for money; earlier that year it received the Which? Utilities Brand of the Year award. A 2009 article by The Guardian reported that Telecom Plus's rates were generally average, and as much as 20% higher than the best deals.
Marketing
Utility Warehouse has no shops and does not advertise on television or in the national press. The company uses word-of-mouth as a primary means of promotion, and offers bonuses to distributors who recruit new customers and distributors. Distributors gain a commission from their own customers and their distributor's customers, making Telecom Plus a multi-level marketing company. There is a £100 joining cost to become a distributor. A 2017 Guardian investigation found that total commission paid to distributors in the previous financial year was £21.1 million, or less than 3% of revenue; if that amount was divided equally among the 41,717 distributors they would each receive £505 per year. Utility Warehouse responded that the calculation was misleading: "there are many who for whatever reason earn considerably less than £500 per year, and there are those who work at their business extremely hard and earn considerably more than this".
