05/02/2017
Three reasons SunEdison, Sunpower, and Sungevity are failing and how you can prevent them from happening to your solar organization.
Jeff Berlin here from LinkedIn. Have you been wondering why some of the largest and fastest growing solar companies in the United States went bankrupt or had major layoffs? Seems strange right? Considering the cost to go solar has gone down steadily from year to year. Big names like SunEdison, Sunpower, Sungevity, and even SolarCity have had layoffs or already have or are currently on the verge of declaring bankruptcy.
There are three main reasons for this one of which I recently learned from a Solar industry professional who has been in solar for over a decade and acted as an executive to launch Solar City in its startup days. To say the least, this guy was a fountain of knowledge. We all know that the cost of solar panels has been going down. All in all, this sounds like a good thing for business and don't get me wrong it certainly can be a good thing. However, when new solar developers enter the market who have access to these new low prices and chose to build projects at right above cost this makes it very hard for companies who have salary, benefits, and commission payouts to compete.
Obviously, developers doing at cost installs can hurt profit margins within the industry. This is a fact we must face in regards to costs going down and a flood of new developers entering the solar scene. However as with anything when a developer or business has low-profit margins this can over time affect installation and service quality. Meaning those who have been in the industry and pride themselves on quality and have a portfolio of happy clients will always be able to command a higher price to the right customers. Grow your portfolio of customers you have done installs for years ago and share their positive words when talking to potential prospects this builds trust and can help to command a higher price.
The second thing to look at for Solar Companies operating on a national scale is the states in which you are doing business in. If you're taking your business national and doing business in multiple states it is best to understand what happened in Nevada. Any company that did a majority of their business in this state is most likely no longer around. Understanding how your legislators think and what your current relationship is with them is also very important. Almost as important or just as important as being diversified in which states you do business in. If you can help your legislators understand how solar provides jobs in their district that in itself is often enough incentive for them to avoid votes that would hurt employment in their district. Having a good relationship with your local media and having them understand how solar support jobs in your area is also very helpful in influencing legislators that it is a good idea to not hurt job growth in their region.
The third thing that is a HUGE factor is knowing and monitoring your cost per acquisition. Anyone wanting to grow their solar business must every month know the cost per acquisition of the clients they are closing. Then utilize this info to eliminate and stop lead generation on avenues that are not effective after they have been optimized. Being that some of the highest paying jobs today are in renewable energy it is very easy for these salaries paid within solar organizations to sneak up on business owners if every month their cost per acquisition rises without knowledge over time. At The Berlin Company, we help market and develop systems for the Solar industry and most of our services allow our clients to keep an eye on the effectiveness of their ad spend. This, in turn, helps to monitor cost per acquisition; an important thing in today's solar industry. If you have been wanting to keep track of your cost per acquisition and utilize the microtargeting that internet marketing allows; I would like to learn more about your business and its goals. Let's book a time to talk at https://calendly.com/theberlincompanyllc or feel free to give me call at 980-395-2338. We are currently only taking on only 5 more clients this month to ensure the best quality of services possible to our clients.
All the best,
Jeff Berlin
The Berlin Company
980-395-2338
