This guide is intended for solar contractors, installers, EPCs and brokers who are purchasing solar equipment with the intention of reselling it. Whether your target customer is a homeowner, business or another broker, this guide provides insights for navigating the PV solar supply chain with the goal of maximizing your profits.
The solar industry is well known for its established relationships. As industry professionals, you’ve probably worked hard to form and nurture partnerships with wholesale suppliers.
But are your supply chains really serving your business and customers the best they possibly can? Have you found gaps that hinder your relationships with your customers? Or, have you discovered bottlenecks that cost you sales with prospects?
Even if you’re feeling good about your supply chain management, you may want to gut-check yourself. Taking time to analyze your processes could identify costs and opportunities that you didn’t know were there.
“If your supply chain runs without many problems, you either have a great supply chain or running very fat.” – EverythingSupplyChain.com
This guide offers tips to help you efficiently manage your supply chain and make informed wholesale buying decisions. Our insights are based on more than twenty years’ experience connecting wholesale buyers and sellers via online B2B exchanges.
In brief, when you buy solar equipment from a wholesaler, you’re purchasing discounted products in bulk to resell at higher prices to solar customers. The bigger the order you place, the larger your discount will be. You take the bulk inventory and parcel it out to resell in smaller quantities per solar job. The discount you gained should provide flexibility to add your mark-up passed onto your customers.
Your margin, calculated by the difference between your mark-up and wholesale prices, will vary depending on the system size, supply and demand, competitive landscape, taxes and tariffs, incentives and product life-cycle. The margin is also known as gross profit, which is the amount of money you make off of a sale. For turnkey contractors and EPCs, the hardware margin is rolled into the overall profit percentage.
NREL reports a U.S. national average residential margin of 17%, which includes hardware, installation labor, direct sales and marketing, design, installation, and permitting fees. The average commercial margin is 7% and is comprised of hardware, installation labor, EPC overhead, developer overhead, etc.
Usually, wholesalers will require a minimum quantity order. This is common for top-selling products. But you may be able to place orders for smaller quantities if products are discontinued or suppliers are willing to help locate replacement parts.
Learn about five techniques to find replacement solar panels and parts.
View this video to glean tips for finding deals and sourcing replacement parts in the secondary market.
Wholesalers tend to take on one of the following business models. Regardless of their business models, keep in mind that wholesalers are masters of distribution. This core competency makes them attractive to manufacturers, who desire to penetrate markets with their brands but prefer to stay focused on innovation rather than fulfilling customer orders.
Merchant or Stocking Wholesaler
Merchant wholesalers take title of the inventory. They may have multiple warehouses or one central storage facility. They stock a large number of SKUs and brands.
Distributor
Distributors are similar to merchant wholesalers except for one major difference. They choose to only represent a select number of brands. Distributors prefer to stock top brand names from manufacturers who have a stable track record and established bankability.
Agent Wholesaler
Agent wholesalers don’t take ownership of the inventory but rather represent manufacturers and other sellers. They facilitate transactions, including taking orders, negotiating contracts, scheduling delivery and collecting payment.
Reseller
A wholesale reseller is unique in the sense that they don't always follow a traditional vertical supply chain. Rather, they tend to acquire goods from a variety of supplier relationships like manufacturers, other wholesalers, liquidators, auction houses, and even developers, EPCs, and contractors with excess and second-hand material. They may work with solar equipment brokers to buy and sell goods as well.
Read about helpful tips to verify a reseller's credibility and ensure you have a positive buying experience.
Read how a reseller found his niche as a surplus liquidator of stranded and distressed PV equipment.
Many solar wholesalers and distributors have evolved their business models to offer value-added services. Some provide storage space to contractors and will drop ship equipment to project worksites. Some offer lines of credit.
And some buy back your excess and used equipment as long as the material has resale value. A number of suppliers are dedicated to making wholesale buying possible and accessible to all kinds of installers and resellers, regardless of your size and capacity.
Learn about the benefits of partnering with a solar equipment broker to gain a competitive edge.
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New
Typically, wholesale equipment is associated with new technology. If you browse any reputable wholesaler’s catalog, you’ll see the latest models of panels, inverters, racking, and other components. These goods come directly from the manufacturer and are under warranty. You won’t see much of a variance in hardware price for newly released models. But you may be able to save on other supply chain costs, such as shipping. Or, you may be able to increase your profit margin by working with a financial consultant who can strengthen your project proposal for financial opportunities.
Read how freight brokers can help your company optimize your supply chain.
Read about financial consultants who work as matchmakers in the solar industry to get projects funded.
Surplus
Surplus, also known as overstock, is new equipment under warranty. These ‘left-overs’ from manufacturers’ assembly lines are an excess of production that manufacturers are anxious to sell in order to clear lines for new production. Just like in other industries, surplus goods are sold at reduced prices.
B-Grade
B-Grade solar modules are new but come with minor aesthetic blemishes. These blemishes in no way affect the energy output or performance of the panel. Most manufacturers sell them with warranties. The price for B-Grade modules is significantly less, which means they’re harder to come by in the open market. But if you have the opportunity to buy them, you could save a big chunk of money.
Excess and Used
With the dawn of the secondary solar market, some wholesalers are now offering a mix of equipment for sale, including excess and used. Excess material from installations, equipment from cancelled or delayed jobs, and unused inventory from solar companies out of business is remarketed to buyers. Some wholesalers are not confined by geographic borders, and therefore, can sell equipment that may be obsolete in your market to buyers throughout the world.
Learn about the secondary market and how it benefits the solar industry.
You may want to consider used equipment, particularly modules, as a cost-saving alternative. Due to a trend of premature decommissions, more and more quality modules are now available for sale.
Your savings will range between 50-75% less than new modules. The price depends on the age and efficiency level. Reputable wholesalers back these products with in-house testing, refurbishing services and limited warranties.
Note that unsalvageable modules do not have resale value. Such modules, especially those with shattered glass, should be recycled. There is a cost to recycle, which all solar system owners should be aware of and plan for when their systems eventually reach end-of-life.
Learn where secondhand solar panels come from and how they are deemed safe for reuse.
Learn more about the growing used solar panel market and what to consider when buying used modules.
Read about factors that affect whether to repair, resell or recycle used solar panels.
Read about the state of solar panel recycling in North America.
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There are many benefits to buying wholesale solar equipment and streamlining your supply chain processes.
“All we are doing is looking at the timeline, from the moment the customer gives us an order to the point when we collect the cash. And we are reducing the timeline by reducing the non-value adding wastes.” ~ Taiichi Ohno, father of Toyota Production System (TPS)
Get insights about PV module wholesale pricing and secondary market trends.
Read how wholesale buyers offset supply chain costs by doing business in the secondary solar market.
Learn about year-end PV hardware deals, an annual secondary market trend.
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When you’re ready to buy wholesale, be careful not to rush into any agreements or contracts. Do your research and ask your industry peers for advice to find the best deals and partners for your business. Follow these steps to save money and increase your profit margins.
1. Evaluate your needs and resources.
Do you have the sales volume to justify buying in bulk? Review your sales history and compare past sales with expected growth. Use the Economic Order Quantity (EOQ) formula to calculate the ideal order quantity that minimizes your holding costs, storage costs and order costs.
Do you have an accurate inventory management system complete with radio frequency identification (RFID) technology? This technology will ensure your stock stays organized and reorders happen when preset levels are reached.
Do you have the adequate storage/warehousing space? In addition to the space, you’ll want to make sure your inventory is added to your company insurance policy. Plan for security and utilities costs as well as internal and external transporting equipment. And don’t forget about packing supplies!
Read about factors to consider when it's time to repower a solar project, including sourcing new PV hardware for the available space.
Learn about managing supply chain risks when it comes to sourcing solar panels from an expert's perspective.
2. Do your research.
There are a number of resources to turn to in order to learn more about wholesalers, product models, pricing and procurement. Trade shows are useful for previewing new equipment models and networking with multiple suppliers.
B2B exchanges, like EnergyBin, offer a wealth of information on products, pricing, supply & demand, and industry contacts. Trade publications report on product reviews, trends and industry news. You can also review what your competitors are doing.
3. Network with the goal of developing long-term relationships.
So much of the solar industry is based on relationships, and there’s a genuine interest in collaborating to advance solar adoption. Much of the industry know-how isn’t written down anywhere. It’s learned by getting out there and asking questions. Make a good impression on industry peers by offering to help them with their goals and challenges.
Learn how to network as a giver, an approach that will make you a person worth knowing and doing business with.
Access these five sources to find quality PV products to buy at wholesale.
Grow your network by using the tools available to you on EnergyBin.
4. Interview potential suppliers.
When you’ve narrowed down a list of suppliers you’re interested in doing business with, be prepared to ask them qualifying questions.
To ensure products you buy meet quality standards, corporate social responsibility requirements, environmental considerations, and applicable laws, ask these questions suggested by Solar Energy Industries Association:
Learn about best practices for buying & selling solar panels for resale.
5. Be prepared for suppliers to interview you too.
The seller may require you to prove you are a legitimate business by presenting a copy of your business license, your federal Employer Identification Number (EIN), contractor license number and/or your reseller's permit. They will also want to address any expectations you have to determine if they can fulfill your needs.
Review a checklist of best practices that buyers and sellers can implement to earn trust when trading solar equipment online.
Read about how to expand your supply chain with new vendors and increase your access to product availability.
Back to TopIf you assess your sales history and projection numbers only to find wholesale buying is not possible for your business, you may still be able to get wholesale pricing. Here are a few options to consider.
Buying Co-Ops
You could join a buying cooperative, which is a group of solar companies that combine forces to increase their purchasing power. Independently, each member would not be able to meet minimum order quantities or negotiate optimal pricing. But together, they are able to pool their purchasing dollars and order larger quantities.
Solar Equipment Brokers
You could also partner with a broker, who can help you find the best deals. Brokers do all the leg work of facilitating transactions for you. Because brokerage firms represent a portfolio of clients, their negotiating and purchasing power is stronger than a single small business. Just like wholesalers, brokers offer a variety of value-added services, such as supply chain analysis, freight forwarding (importing/exporting), financing, warehousing, etc., to guarantee cost savings for their clients.
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1. Compare pricing online, and get multiple quotes.
The internet makes it easy to compare prices. Many online B2B marketplaces and exchanges promote price transparency to level the playing field for companies of all sizes.
Installers, EPCs and solar brokers looking for wholesale deals can request quotes from multiple sellers by joining online exchanges or partnering with a solar equipment broker. For example, EnergyBin members who send out RFQs for their material lists receive an average of 5-10 quotes within one business day.
Even if you have an established relationship with your primary distributor, it doesn’t hurt to request quotes from other sellers. Requesting quotes on a regular basis helps you keep tabs on price trends in the market.
Read the PV Module Price Index presented by EnergyBin, which tracks prices for c-Si modules traded within the secondary market.
Archived Reports:Read how one installer reduced their solar equipment costs by requesting multiple quotes.
Read about five tips for wholesale buyers to consider when shopping online.
2. Seek out the expertise of a solar equipment broker.
Solar equipment brokers live and breathe equipment deals and are masters of efficient supply chain processes. They tend to use the internet to connect to the secondary market, gain global access to products and streamline transportation logistics processes.
Because of their specialized expertise in market intelligence and handling goods, brokers tend to save their clients a minimum of 20% on hardware and supply chain costs.
Connect with solar equipment brokers on EnergyBin.
Learn more about wholesale solar equipment brokering.
3. Nurture relationships with a variety of wholesalers.
Chances are you have a favorite vendor who you tend to call first when you have an order to place. But what happens when that vendor doesn’t have what you need?
Distributors in particular tend to stock limited SKUs. They prefer newly released models over older models that have a higher risk of discontinuation or becoming obsolete. Yet, you may be in the market for older models to satisfy your customer demand.
You may also discover that your primary vendor can get you what you need but is back-logged for a duration that could adversely affect your daily operations. Would you delay projects while you wait for equipment to arrive, knowing that delays could result in cancellations? Or, would you turn to other suppliers who can meet your needs today?
For these reasons, it makes good business sense to have a number of wholesalers on your short-call list.
Learn how the R2 Standard for solar panel reuse and recycling maintains quality while offering a lower-cost option to buyers.
Learn about opportunities in solar panel reuse and recycling to help your customers with asset lifecycle management solutions.
4. Only do business with reputable sellers.
To protect yourself from risks such as counterfeit products, negligence, botched orders, etc., make sure you pre-qualify sellers. Use the interview questions previously provided.
But before you call them, verify that the company is a legitimate company. This step can quickly be done for U.S. companies by visiting the Secretary of State website for the state the business is headquartered in. Search the company name in the business directory listing. If the company is incorporated, the search results will produce details of incorporation and whether the company is in good business standing.
Reputable wholesalers come with success records and recommendations that can be easily located online. They maintain professional digital appearances (websites, Google business listings and social media profiles). Their customers have written positive reviews about their products and services. They tend to be members of trade associations and/or chambers of commerce. In the U.S., they may also be rated by the Better Business Bureau.
You can also connect to industry peers on online business communities, like EnergyBin, which is exclusive to vetted PV professionals who must provide references before they can join the network.
For used/refurbished equipment, only buy from a seller who has established credibility and who guarantees the equipment meets generally accepted safety parameters for your geographic location. Verify that the supplier offers a money-back guarantee if equipment does not perform at advertised power outputs. Determine if the seller offers a limited service warranty on refurbished goods.
Learn how to smartly buy refurbished solar panels and inverters.
5. Inspect your order upon receipt.
When a shipment arrives, plan to receive it in a timely manner. Check for damage. Solar panels are especially fragile because 80% of their weight is glass.
Verify that the products received are what you ordered. Confirm you received the full quantity you ordered. If the order is wrong or something got broken during shipping, contact the seller immediately. Reputable sellers will work with you to remedy the situation.
If you are buying used/refurbished equipment in bulk, it’s a good idea to test the equipment upon delivery. Run electrical tests to verify IEC international standards as well as your local electrical code standards are met. If you find discrepancies between what condition the seller advertised and the true condition of the equipment, you’ll want to address your concerns promptly with the seller.
6. Maintain an accurate and up-to-date inventory list.
When your equipment arrives, enter each SKU and quantity into your inventory database. Better yet, invest in RFID technology that allows you to scan items as they come in and go out. Scanning automatically updates your inventory list. You can also set up alerts to reorder when quantities hit preset levels.
Document as much information as possible, such as model numbers, frame/cell colors, quantities, price, etc. Take photos of each item and file electronic data sheets.
7. Keep your stockroom/warehouse clean and organized.
In addition to clean inventory records, maintain an organized storage space. You don’t want to get into a situation of your database showing inventory in stock but you can’t find it in your warehouse. Establish an organization model that works for you and train your employees to uphold it.
You may also want to plan on semi-annual or annual inventory counts to closely manage any variances in your records. Usually, companies plan to conduct physical counts prior to reordering. Inventory counts are also a way to verify the accuracy of your inventory turnover.
8. Host product demos for your employees and customers.
Product demos educate employees and customers on features, functionality, handling and maintenance. Taking a proactive approach to training staff and customers on proper use has many benefits.
You’ll reduce internal damage. Your sales staff will feel more confident about selling the hardware you stock. Your customers will understand upfront that their arrays are comprised of quality components. And they’ll have general knowledge about caring for the equipment, which leads to longer life and optimal output.
There are a number of formats to distribute product demo content. You could give live presentations during company meetings. You could review information one-on-one with customers. You could host webinars or write how-to manuals.
One of the most popular formats is video, which only requires a basic camera for recording – even a smart can do the job, basic editing software and a hosting platform like YouTube. Here’s an example of a product demo video for customers that addresses the question, How do I take care of my solar panels?
Learn how to create video content that engages prospects and customers without breaking your budget.
9. Don't buy in bulk unless you're confident you can resell your inventory.
The last predicament you want to fall into is stuck with inventory that you can’t sell. Although you receive significant discounts when you buy wholesale quantities, the purchase is still a large investment. You would only want to tie up cash in inventory if you know you can turn the inventory over in a reasonable time frame.
What exactly is a reasonable time frame? It depends on economic conditions. So long as a product is retaining its market value, you’re safe to hold onto it. Oftentimes, cash on hand is more valuable than inventory.
Watch market trends to snag buy-low deals on solar panels and other PV hardware parts.
10. If your primary customers aren't buying, resell your excess stock in the secondary market. Or, partner with a solar equipment broker who can resell your excess stock for you.
If you happen to end up with inventory that isn’t selling and your wholesaler won’t take it back, consider reselling equipment in the secondary market or partner with a solar equipment broker who can get the job done for you. There’s always a buyer somewhere in the world for solar equipment with resale value.
Adding a resale department to your business could be a new opportunity to boost your profit margins. Online B2B exchanges, like EnergyBin, make it easy to list inventory for sale. Note, depending on your location, you may need to apply for a reseller license with your local jurisdiction.
Or, if you’d rather have someone else take over the management of your excess stock, turn to a broker. Reputable brokers will come to your place of business, audit your inventory and offer a bid quote. Some will offer a cash buyout for an entire lot. They may also help pack the material for shipment.
Watch the video to learn about PV hardware trade trends.
Get insights on the PV hardware trade market to kick-start your resale division.
Archived reports:Read how solar companies connect to new buyers to resell PV equipment from cancelled or delayed projects.
Learn more about selling your excess stock online.
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Wholesale buying can save your company money. When paired with efficient supply chain management practices, wholesale buying can increase your profit margins. Most importantly, it helps to bring the cost to go solar down, which accelerates the advancement of solar worldwide.
This guide will be frequently updated with additional information about wholesale buying for contractors, installers, EPCs and solar equipment brokers.
If you’d like to speak with a connection expert at EnergyBin about wholesale buying and supply chain management best practices, contact us today.
This guide is intended for solar suppliers, distributors and brokers who are selling PV equipment at wholesale levels. Whether you’re looking for ways to expand your reach or enhance your customer experience, this guide is for you.
The solar industry is well known for its established relationships. As industry professionals, you’ve probably worked hard to form and nurture partnerships with wholesale buyers. But are you fully reaching your potential as a wholesaler? Or, are there ways you can evolve and expand as a company?
Even if you’re feeling good about your marketing and sales strategies, business operations and customer support, you may want to gut-check yourself. Taking time to analyze your processes could identify costs and opportunities that you didn’t know were there.
This guide offers tips to boost your wholesale solar company to a new level of success. Our insights are based on more than twenty years’ experience connecting wholesale buyers and sellers via online B2B exchanges.
Wholesale selling is all about business-to-business (B2B) sales in bulk quantities. Because of the large volume, you are able to offer a sizable discount to your customers. The discount affords your customers the ability to add their margin before reselling the equipment to consumers or quoting the total price of the solar array to their customers.
Wholesalers typically require a minimum order quantity that customers must meet to qualify for a discount. You have probably also defined volume pricing levels to accommodate for residential, non-residential and utility-scale project sizes. The price of a 50 kW order will vary from that of a 50 MW order.
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Wholesalers tend to take on one of the following business models. Regardless of your business model, keep in mind that all wholesalers are masters of distribution. This core competency attracts manufacturers, who desire to penetrate markets with their brands but prefer to stay focused on innovation rather than fulfilling customer orders.
Merchant or Stocking Wholesaler
Merchant wholesalers take title of the inventory. They may have multiple warehouses or one central storage facility. They stock a large number of SKUs and brands.
Distributor
Distributors are similar to merchant wholesalers except for one major difference. They choose to only represent a select number of brands. Distributors prefer to stock top brand names from manufacturers who have a stable track record and established bankability.
Agent Wholesaler
For more information, please visit Shanghai Gulier.
Agent wholesalers don’t take ownership of the inventory but rather represent manufacturers and other sellers. They facilitate transactions, including taking orders, negotiating contracts, scheduling delivery and collecting payment.
Reseller
A wholesale reseller is unique in the sense that they don’t always follow a traditional vertical supply chain. Rather, they tend to acquire goods from a variety of supplier relationships like manufacturers, other wholesalers, liquidators, auction houses, and even developers, EPCs and contractors with excess and second-hand material. They may work with solar equipment brokers to buy and sell goods as well.
Read how a reseller found his niche as a surplus liquidator of stranded and distressed PV equipment.
Many solar wholesalers and distributors have evolved their business models to offer value-added services. Some provide storage space to contractors and will drop ship equipment to project worksites. Some offer lines of credit. And some buy back excess and used equipment as long as the material has resale value. A number of suppliers are dedicated to making wholesale buying possible and accessible to all kinds of installers and resellers, regardless of their size and capacity.
Review your options for selling excess, surplus, clearance, and used solar equipment to wholesale buyers.
Consider adding value to your customer experience by providing complimentary hardware audits and other asset disposition services.
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There are many benefits to selling wholesale solar equipment. Ultimately, it’s good for business and for the advancement of solar worldwide.
Get tips to gain efficiency when adding an online sales channel to your sales strategy.
Read how wholesale sellers offset supply chain issues by doing business in the secondary solar market.
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Wholesaling is all about marketing. You may have heard of the four pillars of marketing – product, price, place and promotion – and maybe you’ve based your company strategies on these pillars. But the 4 P’s don’t seem to capture the value of the solutions that wholesalers offer.
Wouldn’t you rather be known in the solar industry as a trusted source of advice and problem-solving than just a salesforce of product technology and quality?
That’s where the re-constructed 4 P’s become SAVE, which is an acronym for solution, access, value and education. Not to say that the 4 P’s are irrelevant. On the contrary, they are redefined to better serve B2B marketers.
Solution – Define your offerings by the needs they meet, not by product features.
Wholesalers who succeed at thinking about solar projects in their entirety from inception to completion and perhaps even to end-of-life or repowering have an opportunity to develop solutions that comprehensively address their customer needs.
Having a plan in place for PV hardware resale is a key component to a holistic customer experience.
Watch this video to learn about PV hardware trade trends.
Learn about opportunities in solar panel reuse and recycling, secondary market solutions that add value to your customers' experience.
Access – Develop an integrated, cross-channel presence that takes into account the buyer’s journey (awareness, consideration and decision).
On the front end of the buyer’s journey, content – both online and in print – that targets customer needs and presents your brand offerings as possible solutions helps potential buyers become aware of your existence. Trade shows and other networking events are useful for face-to-face communication as well.
Most B2B marketers recognize that the buyer’s journey isn’t a clear-cut path. There can be a lot of twists and turns that can take time to reach a ‘decision’ destination. Being patient yet persistent with your messaging is key to customer acquisition.
Make online sales part of your cross-channel strategy. Listing your inventory for sale on multiple marketplaces will increase visibility and brand recognition.
Get tips for selling your inventory on the EnergyBin exchange.
Value – Seek to articulate the benefits relative to price, rather than leading with how price relates to your production costs, profit margins or competitors’ prices.
Of course, you can’t go crazy and charge above what the market will support simply because you think your value is worth it. There are several factors to consider when pricing your goods.
Your wholesale price will be determined by the cost of the equipment – what you pay to your supplier – plus your value-added markup. Knowing what markup to add boils down to your market research.
One of the best ways to keep a pulse on the market is to join a wholesale solar B2B exchange. Exchanges, like EnergyBin, are market intelligence powerhouses that reveal what products are moving as well as low-average-high prices.
On EnergyBin, for example, you can analyze data based on product description, condition, location and other filters. The supply & demand feature also provides a list of members who recently searched for a part number or keyword that matches a product, which wholesale sellers can use as a lead generation list.
In addition to using data intelligence available on exchanges, stay up to date with industry reports and price indices. Both Lawrence Berkeley National Laboratory and Wood Mackenzie regularly publish reports that track pricing for the United States. PVXchange publishes a monthly module price index for the European Union.
Read about market conditions that affect solar panel pricing and availability.
Review trends that are driving module availability and pricing in the secondary market to grow your business.
Read the PV Module Price Index presented by EnergyBin, which tracks prices of c-Si modules within the secondary market.
Archived Reports:View the latest Market Watch discussion that covers solar supply chain issues and secondary market trends.
Education – Create and distribute content that educates buyers. Content should explain how your solutions address your buyers’ needs.
Education goes hand-in-hand with promotion. You’ve probably noticed many brands in the industry moving away from straight-up ads as they implement blogs, sponsored content, webinars, videos and podcasts. If they are still paying for ads, they’re doing so in conjunction with a content strategy.
When you produce and distribute consistent quality content, you become known in the industry as a thought leader on the subject of wholesaling. Buyers will know of you and will seek you out when they perceive you can help them with their needs.
Learn how to create video content that engages prospects and customers without breaking your budget.
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Another critical component of marketing is keeping tabs on your competitors. Whether you’re striving to gain or maintain market share, knowing your competitors’ goals, strategies, assumptions of the market and abilities to achieve their goals should be a part of your regular business operations.
The school of business recognizes five key forces that serve as the foundation of competitive landscape. When you understand the collective strength of these forces, you can determine your profit potential.
The five forces of competition are:
1. Threat of new entrants
2. Bargaining power of customers
3. Threat of substitute products/services
4. Bargaining power of suppliers
5. Jockeying for position among current competitors
“Whatever their collective strength, the corporate strategist’s goal is to find a position in the industry where his or her company can best defend itself against these forces or can influence them in its favor,” advises Michael Porter, the creator of the five forces model and professor at Harvard Business School.
Studying these five forces with respect to the energy industry may open your eyes to competitors you aren’t aware of. Plus, you may see new opportunities that your company can take advantage of.
Read more about how these forces play out in the solar industry, and learn new tricks to keep tabs on your competition.
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There are many factors to keep in mind when running a wholesale business. Your primary focus narrows down to increasing revenue and minimizing costs. Here are some key points to help you maintain your focus:
1. Do your research.
What products are your customers in the market for? You don’t want to get stuck with products that aren’t in demand. Nor do you want to get caught off guard by having too little supply of a hot product. If you aren’t prepared for buyers’ needs, they’ll run to your competitors.
Can you trace the supply chains of the products you stock to ensure they meet quality standards, corporate social responsibility requirements, environmental considerations, and applicable laws? Solar Energy Industries Association recommends that you ask manufacturers the following questions to become better informed about your supply chains:
At what times in the year do large orders come in? Review the seasonality of your sales history to determine if there are certain times when order variances occur. Watch industry trends as well, including solar policies that could affect buyer behavior.
What needs to happen internally to get ready for the next wave of orders? Take a hard look at your internal operations and your supply chain to identify ways you can streamline processes and prepare to meet demand.
Learn about three conditions affecting today's solar panel market and how your company can benefit.
View this episode of EnergyBin Market Watch for PV hardware resale trends.
Check out these resources designed to track solar policies in countries and regions around the world.
2. Estimate each product's shelf life.
With solar technology innovations on the rise, how long do you have for any given product before it becomes obsolete? Monitor your inventory to assess what’s moving and what’s not.
Don’t let immobile stock sit in your warehouse collecting dust. Have a plan to clear out older stock after a designated date. B2B exchanges, like EnergyBin, offer a way to remarket products your primary customers aren’t buying. You may have success connecting to new buyers on an exchange. You could also partner with a reseller or broker to move older stock.
Learn more about remarketing products for sale in the solar secondary market.
Read about trends in the secondary solar market and opportunities to make and save money.
Learn about how sellers advertise year-end deals to clear their warehouses and attract new buyers.
Refer to this guide if you have used solar panels to assess whether you should resell or recycle them.
3. Determine a reasonable marketing budget for the year.
Have you ever heard the expression, “You have to spend money to make money”? We wouldn’t be surprised if a marketing professional coined this phrase. Spending money to promote your brand – whether the expense is a trade show exhibit or an ad in a trade magazine or a webinar series – increases buyer awareness.
Promotions that educate buyers, addressing their needs and presenting your brand as a solution to their needs, help buyers move toward making a decision to do business with your company. Establishing an annual marketing budget allows your marketing team to create an integrated campaign that keeps your brand message in front of buyers all year long.
Note that marketing initiatives typically have a minimum of a 2-month lead time. For example, some trade show exhibitions sell out 9-12 months before the show dates. So, plan to finalize your budget well in advance of key initiatives.
4. Keep your customers happy.
Whatever you can do to make the buying experience as clear and straightforward as possible keeps your customers happy.
Read about how to expand your reach and enhance your customer experience.
5. Get strategic about logistics and value-added services.
Logistics
Conduct a cost-benefit analysis to determine if it makes economic sense to partner with a logistics firm, own your transportation fleet or create a hybrid model. Review your analysis regularly as logistics expenses fluctuate and customer needs change.
Get quotes from freight brokers. Price can be extremely volatile from week to week in certain geographic areas due to seasonal freight production. Freight brokers do research to guarantee the best price, regardless of the ebb and flow of the market.
Learn how freight brokers can help your company optimize logistics processes.
Value-Added Services
Don't just preach the lowest price! The solar industry is intent on providing price feasibility and quality equipment. The lowest cost module is not always the best choice for the customer if it falls short of their energy requirements.
Many wholesalers have created business models with added services to provide a holistic experience for their customers, such as lines of credit, inventory storage, project financing, next-day and drop shipping, engineering design, site assessments, operations & maintenance services, and more. Create in-house departments, partner with other companies who specialize in these kinds of services, or implement a hybrid model to amaze your customers and set your company apart from your competitors.
Read about how partnering with a financial broker can add value to your customer experience.
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1. Create a professional online presence for your business.
The Internet provides plenty of options to develop an online presence. Create a professional website for your company, list your company in online directories and create social media profiles. Include certifications, license numbers, trade association memberships, experience, third-party ratings and awards. You can also provide direct links to credential sources for buyers to easily verify your reputation.
An online presence consists of four main categories - a website, search engine optimization (SEO), inbound links and paid ads. All of these elements work together to promote your brand and attract prospective customers.
Read more about how to incorporate these four elements into your online strategy.
2. Look for ways to expand your reach without breaking your advertising budget.
From trade shows to association memberships to webinars and the like, marketing opportunities are plentiful. But you don’t need to exhaust your budget by attending every show or advertising in every trade magazine. Put together a portfolio of initiatives that reaches your ideal customers (aka. buyer personas) and directs them to take the next step with your company (call-to-action).
Plan your initiatives to occur regularly throughout the year to ensure your message is consistently in front of your target audience. We recommend a mix of face-to-face networking like trade shows and digital content activities such as blogs, videos and webinars. To expand your reach further, partner with a trade association or magazine to feature sponsored content in their newsletter or to co-host a webinar. These initiatives come at a price, but they also generate immediate leads.
Read more about how to maximize your investment of exhibiting at solar trade shows.
3. Join an online B2B exchange to find new pre-qualified buyers.
Perhaps one of the most effective ways to connect with new pre-qualified wholesale buyers is to join an online B2B exchange. One of the solar industry’s leading global exchanges is EnergyBin, where PV professionals come together to buy and sell new, used, refurbished, and legacy solar equipment. Members collaborate to advance solar, share market intelligence and decrease costs.
Some exchanges are open to anyone. They tend to take a hands-off approach to liability. Others, like EnergyBin, are exclusive to registered solar companies. These companies must meet member qualifications and adhere to a code of conduct.
One of the biggest advantages of joining a B2B exchange is networking with buyers who are located around the world. Whether you're looking for ways to enter new foreign markets or to expand your international reach, a membership to an exchange is an affordable way to build relationships with companies outside your geographic area.
Grow your network by using the tools available to you on EnergyBin.
Exchanges also offer a wealth of market intelligence. For example, on EnergyBin, members can access PV hardware trade data on price, availability, quantity, quality, location, buyer/seller contact information, and more. Often, this information tends to holder greater value and the products themselves.
Read the PV Hardware Trade Analysis H2 for a sample of market intelligence available on EnergyBin.
Archived Reports:Check out these key resources for U.S. companies who want to take on an exporting role.
Read how an online reseller connects to new qualified buyers on EnergyBin.
4. Be transparent in what you list for sale.
There’s nothing more frustrating for a buyer than learning that a listed product for sale is not available, does not match the advertised condition or varies in price from what is quoted. Strive for honesty and accuracy when advertising your products online.
When listing your products, whether on your website or in an exclusive exchange, include the details/specs, accurate descriptions of the condition, quality, quantity, price and product certifications.
Note that product certifications are necessary when listing on a global exchange because you don’t want to mis-lead another member into thinking that a product is rated for the United States, for example, when it is not. At the same time, you wouldn’t want to dismiss a member located in the U.S. for said product because their actual solar project may be located in another country. We have found this case to be common among EnergyBin members, who have main offices in the U.S. but are procuring equipment for projects around the world.
The risk you run by withholding information or being elusive about a product for sale is that you can quickly lose a buyer's trust. In the solar industry, relationships bear weight. If it gets around that your company is not trustworthy, it could be detrimental to your reputation.
Get insights on PV module wholesale pricing and secondary market trends.
5. Build your credibility on- and offline.
One of the best ways to boost your credibility online is via customer quotes and case studies. When a happy customer gives you positive feedback about their experience, be ready to capture their story. Ideally, you would want to create a library of case studies and testimonials on your website for prospects to review as they consider working with your company. Present the content in a number of formats – videos, articles, short quotes, etc. – to make the message visible and easy to consume.
Google and Facebook reviews can also help. LinkedIn has a recommendation feature available on individual profiles, which may serve you and your employees well to have. Give a variety of options that make it easy for your satisfied customers to advocate on your behalf.
Once a prospect has heard about your company, reviewed your digital content and completed your online call-to-action, it’s time to take the relationship offline. Will the prospect get the same professional vibe on the that you presented on your website? How do you boost their confidence in that initial call that you’re worth doing business with?
Treat every call as your opportunity to make a stellar first impression. It doesn’t matter what a prospect has read about your reputation online if that same credibility doesn’t shine through on the . As soon as a one-to-one relationship begins, you need to work to earn their trust. Be patient. Oftentimes, early communications with a prospect are exploratory. Few prospects are ready to place an order when you first talk to them. Be prepared to answer their questions and offer your expertise, which reveals the value you bring to the table. Conclude each conversation by summarizing next steps, and follow up – do what you say you would do.
Check out these tips for improving your trust level with your customers.
Another way to build your credibility is by sharing your expertise with your industry peers.
6. Reduce your risk by conducting due diligence on a prospective buyer.
Wouldn’t it be nice if you could sell to every prospect who wanted to buy from you? Sadly, it is not possible to be inclusive when it comes to buyers. As a company, you are charged with turning a profit, upholding organizational core values and reducing risk to minimize losses. The last thing you would want is to fall victim to fraud or have accounts default due to inability to pay.
Fortunately, today’s global economy is more connected than ever thanks to the internet. Taking the time to do online and offline due diligence will reduce your risk.
Online
Offline
7. Reduce your risk further by developing and communicating company policies.
Having a comprehensive policy document, also known as terms and conditions, protects your company from what-if scenarios that could result from a customer relationship. Such a document should be treated like a work-in-progress. There will be times when you choose to revise or add onto the document. It is wise to work with a business attorney to ensure the document is crafted in a way that would protect you in a court of law.
Some key policies that all wholesalers should consider developing include:
It is commonplace for companies to post terms and conditions on their websites, usually in the footer to make it easily accessible. Beyond that, integrate policy information into your communications with prospects, customers and employees. Plan to inform them regularly – both in writing and verbally – to ensure they are well aware of your policies.
8. If you are selling second-hand material, test the product and guarantee performance levels.
A number of wholesale buyers are purchasing second-hand material, especially modules, at megawatt levels. Quality used material with resale value is increasing in supply thanks to the repowering trend taking place throughout the U.S. and Europe.
If you are dealing in second-hand material, guarantee what you’re selling. A number of equipment resellers test used panels to guarantee product safety and verify amp and voltage performance levels. They reposition the product for sale in the secondary market, which may come with a limited-term service warranty. Some sellers offer a money-back guarantee based on a verified energy producing level.
Learn more about two tactics - resale and donations - to re-deploy secondhand solar panels to communities in need.
Read about best practices that reputable resellers abide by when dealing with second-hand material.
Read about the growing opportunity to remarket second-hand modules in the secondary market.
Learn about what factors to consider to determine the resale value of decommissioned PV hardware.
9. Find ways to wow your customers and increase your profit margin.
From online shopping portals to drop-shipping to other value-added services, there are many ways to wow your customers. Of course, you’ll want to make sure every perk or service you offer is adding to your bottom line. If you can’t see a connection between the two, then it’s probably not worth doing.
Find ways to enhance your customers’ overall experience by collecting feedback from them. Don’t just send out general surveys. Call them and have a personal conversation. Customers will share more valuable information with you if you treat them in a personable manner.
In addition to the customer experience, take a hard look at a solar system’s project lifespan. There are numerous opportunities to create value from inception to end-of-life.
Learn about secondary market solutions, including resale, solar panel and inverter remanufacturing, and recycling.
Read how these wholesalers have created a new revenue stream by remarketing excess equipment from other solar companies.
10. Form strategic partnerships with other companies to enhance your customer experience.
It may be tempting to try to be all things to all customers. But it won’t always be profitable to create in-house services. Before deciding to add another department to your operations, conduct a cost-benefit analysis. Consider strategic partnerships with other companies who are experts in their specialty areas. You may find a perfect partner to offer a new service that’s a more profitable arrangement than doing it on your own. Plus, partnerships allow you to stay focused on what you do best.
For example, if you are a master at selling solar equipment but lack the skills needed to design solar arrays, partner with a solar design engineer to create a value-added service to your customers.
Or, consider what partnerships you can form that provide secondary market solutions to your customers as their solar systems mature. Have a plan in place for PV repair, resale, and recycling to service your customers through system end-of-life.
You don’t need to know everything there is to know about solar. But you should know who you can contact in your network to fully satisfy your customers' needs.
Read about how to network like a pro to stand out as a person worth knowing and doing business with.
Learn how FabTech, a solutions provider for solar panel recycling and refurbishing, uses EnergyBin to form new partnerships.
Read about the state of solar panel recycling in North America.
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Wholesale selling results in larger orders and increases the average order value, which in turn allows you to offer more attractive volume discounts. When paired with strategic marketing activities and value-added services, your company expands its reach and enhances your customer experience. Most importantly, wholesale selling helps to bring the cost of solar down, which accelerates the advancement of solar worldwide.
This guide will be frequently updated with additional information about wholesale selling for solar suppliers, distributors and brokers.
If you’d like to speak with a connection expert at EnergyBin about wholesale selling and available marketing opportunities on our B2B exchange, contact us today.
If you are looking for more details, kindly visit wholesale space solar cells.
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