How to Write a Solar Panel Business Plan
The solar panel sales industry has been growing at an impressive pace over the last number of years, which is driving demand for solar panel business plans, solar panel business plan templates, and solar panel company pro forma financial projections.
There are numerous reasons why the solar panel industry is growing at a healthy clip. To illustrate, the federal government, state governments, and local municipalities often provide homeowners and business owners with tax credits when solar panel systems are installed. This is just one of many reasons why entrepreneurs are starting up solar panel sales and installation companies and writing aligned business plans. Regardless of why solar panel business plan demand is growing, having one prepared is an excellent strategy to ensure readiness for funding or expansion purposes. From this, our solar panel installation and sales business plan writer has come up with some tips and tricks to help owners write their own solar panel business plan, business plan template, or pro forma financial projections.
Executive Summary for a Solar Panel Business Plan or Template.
The executive summary section for a solar panel business plan should start with explaining the basic components of the business, such as the company’s name, location, service area, and legal structure. Once this is complete, our solar panel business plan writer strongly recommends explaining, in brief terms, the types of solar panel systems sold and installed. By following this practice, the business owner is able to set the reader’s expectations as to whether the organization is going to specialize in installing a few limited solar panel systems or if they’re going to provide a broad range of systems for sales and installation.
The company information section for a solar panel installation and sales company should again reiterate the company’s name, location, and service area. Also, we recommend providing details related to competitive advantages for the organization. In some solar panel businesses, their competitive advantage could be offering a wide selection of solar panel systems to install. For other businesses, their service area may be broader, possibly on a regional basis, as compared to other businesses. No matter the competitive advantage, make sure to explicitly state but do not provide more than one or two competitive advantages. Keep it short, sweet, and to the point.
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Popular Services/Products Offered by a Solar Panel Company.
Solar panel installation products and services for solar panel companies may vary between organizations. From this, the need to explicitly state products and services for solar panel systems is imperative for a business plan. In some instances, some solar panel installation companies provide a broad range of services, such as installing solar panel systems for homes, pools, air conditioners, electric heaters, and even electric cars. In other instances, solar panel companies will specialize in niche services such as home or office solar panel systems. Because of the various business models that may be employed, make sure to specifically discuss which model is embraced and then provide details about the systems afterward.
The pro forma financial projections for a solar panel company regardless of the business model embraced for products sold are similar in structure. In starting, our solar panel company pro forma financial projection consultant recommends that the financial model utilize an average customer, average sales price, and average variable cost method. Specifically, when we structure this kind of solar panel company financial model, we will multiply the solar panel installations weekly by the average installation sales price and then deduct the average variable cost, again based on weekly sales. With the revenue based on the weekly structure, the next step would be to multiply the gross profits, which are simply solar panel sales minus solar panel variable cost, by 4.333. The product would be your gross profits for the month. From this point, solar panel business owners than just need to subtract their monthly fixed cost to arrive at their estimated net profit. This basic model will not only help entrepreneurs identify how many solar panel customers they need the service on a weekly basis but also with their sales prices, on average, need to be to achieve their desired net profits.
Hopefully, these insightful tips and tricks for writing a business plan were helpful. As always, if you need help with a business plan or financial projections, just send us an email or give us a call.
Author: Paul Borosky, Doctoral Candidate, MBA., Author