The pandemic this year has caused slower than usual residential solar sales but has also served as an opportunity to pause and evaluate business models. A lot of the focus on that front has been modernizing sales and design processes.
A less discussed strategy for local solar installation companies to strengthen their place in the market, increase sales and install quality systems is via installer partnership programs. We chatted with two Elite level solar installers within the Panasonic Residential Solar Installer Program to explain why such a relationship has been valuable. Four key points stood out.
1. Brand building
Las Vegas-based Sol-Up was founded in 2009 and is one of the oldest pure solar contractors in Nevada. Despite experiencing the 2009 economic downturn, the company has continuously grown over the years, only interrupted by a short decline in sales in 2015, when local regulation changes forced nearly the entire solar industry to leave the state or close their doors. Around the time that catastrophe was avoided and Sol-Up got back to business, they started working with Panasonic.
“We started our relationship with Panasonic in the summer of 2017, changing completely over from our previous module supplier,” said Frank Rieger, CEO of Sol-Up. “Panasonic provided us with the financial and production capacity stability that we didn’t have with our previous supplier, while still offering industry-leading technology.”
Sol-Up has seen installation numbers and revenue almost double every year with 3,208 kW installed capacity in 2019 alone. Some of the credit for that growth is baked into the decision to align with a strong brand that average customers recognize.
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“Being a certified partner of Panasonic has certainly help us generating extra business. A lot of our customers seek us out, as they are explicitly interested in working with contractors who install Panasonic modules,” Rieger says.
On the other end of the country, Same Sun of Vermont was established in 2011 with two owners and one employee. Specializing in small residential and commercial grid-tied net metered systems (under 500 kWac), Same Sun has grown to 15 employees, and installs more than a megawatt of solar power each year.
Panasonic became its go-to solar panel provider on roofs with limited space in order to maximize the kWh production.
“We have been in business for nine years, which actually makes us one of the older surviving designer/installers,” says Philip Allen, CEO of Same Sun. “However, combining our image with a respected company of Panasonic’s reliability and history has greatly benefitted our ability to compete on a national level.”
2. Value-adds and economies of scale
That last point of Allen’s is a big one. Aligning with a brand like Panasonic can help smaller regional installers grow and compete with larger national solar installers. Your average customer is more likely to have heard of Panasonic than other big solar-only brand names, for one. There is value in that. But more to the point, an installer in the program can take advantage of certain sales, marketing and training programs that come as perks within the different tiers – Authorized, Premium, Elite.
Panasonic’s Elite Tier is new this year and provides access to new products and rebates, while providing preferred access to product availability and the best pricing. These installers will also retain their Premium Installer benefits, including exclusive access to leads generated from Panasonic’s website, cooperative marketing funds and an Installer Portal, which is designed to help them grow their business.
So, while the panels may cost customers more, there will be reductions in the dreaded soft cost line on the ledger.
“We truly appreciate the marketing support we’re receiving from Panasonic — the various incentives and co-op funds reduce our marketing costs, making this a win-win situation for both our organizations,” Rieger says. “Moving up the Panasonic tiers has significantly raised the reputation of Sol-Up, helping us to become the major solar provider in Nevada. Particularly Panasonic’s services and support for marketing have helped us building out our organization.
Same Sun says the same, son (sorry, I had to).
“The promotional dollars have allowed us to increase the advertising and materials we can purchase,” Allen says.
Other tangible improvements both Sol-Up and Same Sun attribute to aligning with a single identifiable brand is both the solid ROI for customers and the profitability for their business.
“ROI and sensitive pricing are crucially important in a highly competitive market like Las Vegas, and while cost of supply can never be low enough, Panasonic’s moderate price structure has helped us offering a competitive product,” Rieger notes. “Profitability is the result of high sales numbers with reasonable margins, and has so far been successfully achieved in our relationship with Panasonic.”
3. Premium product and max production
To move up the ranks to Premium or Elite status in a module partner program requires selling more of that module. So, everything noted to this point (name recognition and marketing perks) would be much less valuable if the technology was subpar.
In the case of Panasonic’s HIT modules, these are premium, higher efficiency modules with hetero-junction cells. They rank among the best in terms of temperature coefficient, which is a huge deal for a Nevada installer like Sol-Up. They come at a higher price point than conventional modules, but there is a strong case to be made that adding cost for premium PV modules is worth more long-term value for customers and installers. See this Solar Builder feature from January (or listen to this webinar) on the value proposition of HE modules to get more in-depth on the subject. Same Sun proves out the point made in that research by initially using Panasonic modules specifically on tight rooftops to maximize ROI, but the overall reliability has proven itself over the years.
“We have watched a number of manufacturers go out of business,” Allen says. “Panasonic’s 101-year history and diverse product line is very appealing to us and our customers. We have not returned or serviced a single module.”
4. Business model freedom
Vince Lombardi summed up the key to his offensive system for the Green Bay Packers in the ‘60s as “freedom within discipline,” which is a concept I’ve always liked. Set basic parameters for working together to achieve a desired result, but don’t overly script everything from the sidelines — allow for creativity in each role to adjust to conditions as they happen. This came to mind as a final key benefit to the Panasonic Installer Program: Being aligned with a strong brand but still having the freedom to run your own business.
As Allen puts it: “We have been offered other opportunities like this with other module manufacturers and have turned them down for a variety of reasons; one of which was our perception of those organizations of being controlling and dictating a certain business model. Panasonic has not interfered in anything we do and has been helpful when they could.”
Just be sure that business model you’ve developed is one focused on quality. For Panasonic to maintain that aforementioned brand strength, its quality must be reciprocated by its solar installer partners in the trenches:
“As a contractor, you have to understand and incorporate Panasonic’s philosophy of providing premium products and services on all fronts. If you are just looking for quick revenue with cheap products this is not your place to go,” Rieger concludes.
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