Improve solar business profitability with product flexibility | The Pitch

Residential solar is in a lull, and the best path forward may be product and design flexibility. On this episode of The Pitch, we discuss the business challenges facing solar installers, and how a different approach to operations and installation — using multi-module microinverters — can boost solar installer profitability.

Here to explain is Jason Higginson, head of marketing in North America for APsystems. Watch the full 15 min conversation here, or read a partial transcript below.

The business challenges facing solar installers

Higginson: “Part of the challenge is no one’s focusing on installers. Many manufacturers, for example, they get great deals with distributors, and they push product, and they give them a better deal. These distributors are often sitting on a bunch of product that they push to installers that may or may not be helping them in their daily solar installation business.

“On the flip side, some manufacturers focus almost exclusively on the end user. There are several inverter brands in the market that promote their brand and their marketing to the end user so that those brands are being asked for by name. Then the installer is forced to use their product even though it may mean less margin, or it may mean a tougher install, or a limited option on choice of equipment.

“Few are actually focusing on the solar installation business, which is the backbone of our industry, which really is facing a variety of struggles at the moment:

  • Fierce competition out in the market;
  • Struggle with profitability;
  • Paying for labor and finding quality labor;
  • Generating leads for their business;
  • Finicky customers;
  • Struggling to make a name for themselves; and
  • Finding a way to push into commercial solar.”

APsystems is primarily a microinverter manufacturer, so how can it alleviate any of those challenges?

Higginson: “We help our installers to be more competitive. We’ve talked about that in a previous episode of The Pitch, how our DS3 product helps them increase their margins.  We reduce their labor costs. We send them leads — that’s another big one. We have an installer locator tool which is pretty slick.

“We talk about our installers. When they do an install, and they send us pictures or video, we talk about them online, in our newsletters, we promote their on social media. We’re trying to help be an extension of their marketing arm.

“We’re also helping them transition into commercial solar, to try to make that as easy as possible with a plug and play three-phase product.”

“We wanted to also improve the ways in which we could address some of these installer pain points throughout the installation process but also to add flexibility in that technology. Example: we developed a relatively battery-agnostic inverter. It’s a battery inverter that charges and discharges the battery in an energy storage solution. That way installers weren’t just tied into one brand or type of battery.”  

Why a battery-agnostic inverter makes sense in a ‘future-proof’ PV installation

Higginson: “It’s funny, we see this all the time in the industry. Everybody wants energy storage quoted. There’s a lot of installers out there putting out energy storage quotes, and then the homeowner sees the price tag, and it’s like we’re going to wait on energy storage, but let’s put in the solar. So, having that future proofed … we’re constantly adding to our list of compatible batteries. Right now it’s at over 20 industry leading batteries, and we continue to add more names.

“We wanted to make sure our product can work with all of those leading energy storage companies that in some cases can install in 30 minutes. Whereas an inverter company that provides an energy storage solution where it’s kind of an add-on, and it’s a third party, and it may take six or seven hours to put in, that doesn’t necessarily help the installer. It eats up their margin when they’re spending all this money on labor to get this new solution put in. We do provide a branded solution, and it goes in quickly, but we wanted to add that flexibility of choice.”

Cost and profit margin comparison

Crowell: “The DS3 is a high power multimodule microinverter. So, instead of one microinverter per module, each DS3 handles up to four high wattage modules.  There are a few ways to look at that, the easiest being cost: installing one microinverter for every four panels is less product, less cost. Is that significant enough to make a difference for my own bottom line?”

Higginson: “We also talk about how installers can save on the PV module cost as well because they’re using larger panels, but they’re using fewer of them. They can come in at an overall savings of $500 to $1,000 per install on the module savings. But if you add all of that up, these installers that commit [to the APsystems platform] they use that as a leverage tool over time to improve their business.”

Pick up the last five minutes of the video, when Jason walks through a cost and profitability comparison of multi-module microinverter job vs. a traditional single microinverter.

Listen to more in-depth conversations on Solar Builder's YouTube channel

Our most popular series include:

Power Forward! | A collaboration with BayWa r.e. to discuss higher level industry topics.
The Buzz | Where we give our 2 cents per kWh on the residential solar market.
The Pitch | Discussions with solar manufacturers about their new technology and ideas.

Tags: , ,

See Discussion, Leave A Comment

This site uses Akismet to reduce spam. Learn how your comment data is processed.