2014 Trends: Solar Distribution

Several years ago, a solar distributor was nothing more than a big warehouse that managed the job-by-job logistics, as Geoff Stenrick, president and CEO of SimpleRay Solar remembers.

“Anyone could stock products and sell them,”Stenrick says. “Today’s solar distributor is a partner to the installer, providing many solutions to help their customers succeed.”

These solutions can include project guidance, overall business support and design services to their customer base.

“We can help independent dealers,” says Jonathan Doochin, CEO of Soligent. “Some are good at sales and marketing, but often struggle with installation. Others are great installers, but have trouble sourcing deals. All would like to trim their soft costs which can make up two thirds of the total cost of an installation versus being profit for our installers and lower cost for their customers. Soligent helps by letting them offload the things our dealers struggle with until they are ready to take them back on, if they ever want to,” he says. “In turn, Soligent helps dealers lower the cost of solar installation and shorten the time from contract to completion.”

On the other hand, SolarCity serves system owners directly.

“We create a custom design for each project to maximize efficiency and create the best possible value for our customers,”says Jonathan Bass, vice president of communications for SolarCity.

So his company has expanded partnerships with a range of firms from suppliers to private developers and engineering, procurement, construction firms (EPCs) to provide added value to its customers.

Solar distributors also need to choose their manufacturing partners wisely. Nestor Tarango of Affordable Solar says that during the past 16 years, his company has seen many manufacturers enter and exit the market.

“When choosing components, we look for companies that are diversified, or have substantial financial backing to survive turbulent times of the industry,”he says. “It’s incredibly important for our installers to understand that they are buying and selling 25-year assets and that the chosen manufacture will be around to honor any warranty questions.”

Financing is a huge issue in solar, so distributors are stepping up to fulfill this need for customers, too.

“Most consumers are only given a few options when it comes to financing,” Doochin says. “In reality, there are often multiple options in most markets that Soligent can help make more visible to our dealers and them to their consumers. We have developed back-end systems that help us comb through different options so consumers can get the best deals.”

SolarCity also plans to launch a Web-based investment platform to allow a broad range of investors, including individuals and organizations, to participate directly in solar investments. Bass says these types of investments have previously only been available to large financial institutions.

Tarango says his company has also tried to make payments easier by adding options like payment assignment from leasing companies. This means offering the installer the option to have the leasing company pay this distributor directly, rather than waiting to be paid then paying off their line of credit

“Distribution is more than just being the biggest,”says SimpleRay’s Stenrick.“Today’s installers are looking for more than price alone. The next trend of the modern solar distributor adds value to its customer’s offerings, the engine that makes the modern solar installer run smoothly and efficiently from Day One.”