By Charlie Knadler, CEO, EnerBank USA
At the end of last year, Congress extended the renewable energy tax credit through the end of 2023. For solar projects that begin construction in 2021 and 2022, the tax credit will remain at 26%, and then decline to 22% for 2023. Until recently, 2021 was going to be a critical year to maximize homeowners’ incentives to purchase solar. While homeowners will still be motivated to install solar over the next three years, it’s still a great time to instill the sales and business processes that will best take advantage of solar opportunities regardless of what happens in the future. Here are some tips to make 2021 your best year for solar.
Ramp up your sales efforts strategically
The most important thing you can do to make this year soar is to generate leads, because leads will translate to more sales and installs. The sooner you can ramp up lead generation; the better sales will be, especially during these critical spring and summer months when solar power generation is highest. There are many ways to get leads: partnerships, events, email, door-to-door, pay-per-click ads, SEO, social media sponsorship, etc.
First, you’ll want to focus on the methods that work best for you. One way to determine the best strategies is to test many different lead-gen avenues. Measure your results. Put more money into the tactics that work best. Reduce money on tactics that don’t generate a return. Hopefully, you’ve started quality lead-gen tactics already. Ramp up your efforts early in the year.
The magic formula — and then some
What we’ve found from working with tens of thousands of contractors over the years is that if you follow a few simple best practices, you’ll grow your business. We typically encourage contractors to use our “magic formula” for offering payment options and closing more deals. But we’re confident that as a solar contractor, you already know that formula (advertise financing options, offer those options to 100% of customers 100% of the time, contrast payments to utility bills).
So, let’s dig a little deeper into what really can make the difference for you in the solar world.
Many times, promoting the lowest interest rate is not always the best way to make the sale. While you and others in the industry may think of a project in terms of “cost per watt,” we’ve found there’s great value in approaching cost from your customer’s perspective, which is how they can benefit in terms of “total cost of ownership.” Basically, they want to know what their bottom line is, when all is said and done. An effective total cost of ownership analysis takes the monthly payment and multiplies it by the loan term, adds in the initial deposit, and subtracts out the anticipated tax credit. That provides a final number that makes it easy for the customer to evaluate against your competition.
Your competition’s weak link may be the financing portion, because they lack access to smarter loan products. You’ll be a more appealing choice if you can make it simple for the homeowner by knocking down the payment through automatic re-amortizations based on payments made — including the ITC, bonuses or tax refunds used as a lump payment toward the loan. That way, you’re giving your customers ultimate flexibility for how they choose to manage their payments, and cost of ownership.
If you do choose to go the “low interest rate” route, an attractive way to show your customer a reduced “total cost of ownership” is a loan with a low interest rate over a long term, or even a zero interest rate loan. Just make sure your lending provider offers a wide selection to meet the varied needs of all your customers.
Help spread the word
Maximize sales this year by inviting your customers to spread the message. Online reviews have a huge impact on consumer behavior. Encourage your happiest customers to leave reviews in the online systems that matter the most to you and your customers, like Google Reviews, Yelp, and others. Leverage your best reviews by posting them on your website, in emails, and on social media. Look at how you can improve your rating with the Better Business Bureau and other rating groups. Enlarge your social media presence by taking Instagram worthy photos of your installs. Ask for referrals at every opportunity you get. You can even offer a discount for customers who agree to provide actionable referrals.
Create a sense of urgency and mission among your employees
To maximize your company’s potential this year, take the time to get your team running on all cylinders. Use company training to create that sense of urgency. Set company-wide goals, and have your teams create objectives that directly accomplish them. Track those objectives each month and each quarter. Reward individuals, teams, and the entire company when they achieve specific goals. Incentives can include bonuses, vacation time, or other perks to encourage them to press toward the goal. Remember, incentives don’t always have to be monetary. Some recognition in front of peers can go a long way — in fact, most employees stay with a company because of manager recognition.
Make 2021 your best year yet as you implement some of these best practices to generate leads and leverage solar payment option choices. As you work toward establishing these processes in your business, you’ll be much better prepared regardless of when the tax incentives expire, and your operations will be more efficient and productive than ever.