Solar Energy Business Model Based in Melbourne
In the contemporary world, human beings have identified solar power as one of the most essential sources of electricity power. Therefore, they have harnessed the radiant heat, in addition to, light from the sun in a process that uses a wide scope of technologies, which are ever evolving.
According to the findings of the research conducted by Schaper & Volery (2007, p. 55), it is indicated that some of the technologies largely attributed with solar energy include solar thermal electricity, solar architecture as well as solar photovoltaic among other crucial technologies.
Sometimes, many regions of the world experience urgent problems relating to power but considering the solar technologies, they can be of great help during such times.
With the advent of solar technology, many groups have surfaced, not only in Australia but in the entire world, as well. Solar energy consultancy groups play a key role in the solar energy industry.
One of the major contributions that the solar energy consultancy groups make includes conducting household inspection and thereby giving the clients a report indicating the solar options for their particular households, in addition to sites.
This can indeed range full-fledged general solar installation that generates electricity to simple solar walk away lighting (Galbraith, 2001, p. 43).
Due to the rising demands for alternative energy in households and factories, there is a need to establish a consultancy business in the field of solar energy. Therefore, the purpose of this paper is to formulate a solar energy business model based in Melbourne, Australia.
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For the purpose of a comprehensive coverage of all the areas required for the establishment of a solar energy consulting business, several aspects will be considered. These will include; a clear and precise of a solar energy business concept, declaration as well as an explanation of the mission statement, industry as well as market analysis, identifying the management team, development of products and services, the financial considerations, timelines and finally assumptions.
The concept solar energy consultancy business
Energy Saving
Efficient energy use is a commonly used term and it refers to the target of attempts aimed at mitigating the energy amount necessary to offer both goods as well as services. Renewable energy such as solar energy is attributed largely to the efficient use of energy.
Timmons & Spinelli (2007, p. 89) indeed supported this by indicating in his research findings that energy efficiency, in addition to, renewable energy is twin pillars of sustainable energy. Solar energy is largely used as an alternative due to its efficiency.
Households and industries in Melbourne, Australia that can be identified as using energy efficiently because, as compared to other non-renewable sources of energy, the use of costs as well as resources is greatly mitigated.
Indeed, the only cost involved is during buying and installation, in addition to maintaining the installation, which is done rarely.
With many households and industries in Melbourne adopting the efficient use of energy, there is a need to provide consultancy services, which include installation, servicing among other consultancy services.
For a person intending to become a consultant in the field of solar energy in Australia, it is herculean important, to start by seeking employment in a company that deals with solar products. The rationale for this is that the person will become knowledgeable in the field of solar energy and as such, it is the start point on route to become a solar energy consultant.
Once a person establishes himself as a solar energy consultant in the Australian market, it is indicated in the findings of the research conducted by Grave & Zacharakis (2008, p. 77) that, one should not become affiliated with any one company or even product. Further, Grave & Zacharakis (2008, p. 79) asserts that, once a person becomes a solar energy industry consultant, he must be able to recommend, not only products but options, as well, across the field of solar energy.
The objective of this solar energy consultancy is to provide a low level cost, environmentally friendly, in addition to, an innovative energy power to consumers within Melbourne and its environs through energy generating systems which are not only highly efficient, but cost effective, as well (Horngren, 2002, p. 24).
The solar energy industrys background and its present status
The consultancy business will be based on the Australian energy industry. To be more precise, the business competes in the non-renewable segment of the energy industry in Australia. In the last four years, the business has had average annual sales of $ 1,000,000.
The last four years have been important for the business. As such, the business has experienced tremendous growth and this has been evidenced by the amount of sales made in the past four years. Generally, the sales have been increasing each year and this is a clear implication that the company is gaining ground.
Based on the current growth experience, it is being forecasted that the trend will continue as long as the current practices are not only maintained but be continuously improved, as well.
The consultancy business, having been established six years ago, can be identified as in the rapid growth stage. This assertion is evident considering the last four years. Currently, the management of the business has embarked on development plans where is wants to invest further in renewable power generating program.
However, several issues are currently facing the business. Foremost, the competent service men are less in number. However, the management has established a viable plan through which the most competent consultancy servicemen will be recruited to form part of the team. The solar energy consultancy business can be identified as currently being dominated by Melbournes open markets.
Competitiveness
The concentration of solar energy consultancy industry
Industry concentration is a term used to define the measure of the number of organizations as well as the size of the organizations, which are considered predominant in the given industry. In a more precise way, industry concentration describes the nature of the competition within a particular industry.
In the case of Australian solar energy consultancy industry, there are a number of key players. Among the big consultancy groups include Adopt a Light consultancy group, Glowing Light Consultants LTD as well as The Renewable Consultants Limited. Considering these consultancy firms, they rule a considerable market share.
According to the conclusions of the research conducted by Knight and Thomas (2012, p. 23), it is indicated that Adopt a Light consultancy group commands a 20 percent market share while Glowing Light Consultants LTD commands a 15 percent market share.
In a similar research conducted by Wade (2008, p. 177), it is indicated in the findings that The Renewable Consultants Limited has taken up a massive 22 percent of the market share in the solar energy consultancy industry.
Generally, there are a significant number of solar energy consultancy firms. However, these firms are perceived as not posing a significant threat to this company. Clearly, the Renewable Consultants Limited is the dominant leader in the solar energy consultancy industry. However, the other two consultancy groups as well as our company pose as a threat to the proclaimed industry leader.
Our products as well as services are competitive in nature. However, according to a recent research conducted by this consultancy group, it was found out that there are other consultancy groups within Melbourne that offer the same competitive services as well as products that we offer to the clients.
Therefore, the management of this consultancy business quickly acted on the recommendations indicated in the research by establishing measures to differentiate the business products and services from competitive ones in the eyes of the solar energy clients (Inwood, 2007, p. 16). As such, the top management of this group embarked on the branding differentiation strategy.
Generally, there are few requirements that a company must comply with before being granted entry into the consultancy industry in Australia. Further, one must provide sufficient proof to show that he has a considerable knowledge and experience with the solar energy products and services.
This implies that the entry to the industry is relatively less complicated. This is the possible reason why there are in the industry. The easiness to admission favors new entrants, who are considered to be prospective competitors, as they enters the solar energy market during the periods in which high profits are being achieved and therefore expanding the capacity to produce.
This is a major drawback to the existing businesses as it leads to prices of the consultancy products as well as services to be driven down and similarly, the profitability level lowers down.
However, the government realized that there is a condition of unhealthy competition and as such, it has established new regulations that will ensure that the entry to the industry is complicated (Shapiro, 2002, p. 54).
This implies that the competitors will find it hard to enter into the industry and as such, the profit margin of this consultancy group will remain favorable. Some of the new requirements that the government has established include;
This will greatly favor the group as it has products as well services that are not only well branded but well established, as well. If a new competitor is lucky enough to gain entry, it will have to spend a considerable amount of time money as well as efforts in an effort towards establishing a successful product as well as the service (Barber, 2011, p. 559).
The Australian government has sought to limit the patent technology, in addition to, other intellectual property and as such, it is a great boost to this company as new competition is not imminent.
Supply chain concentration
Industry rivalry
The rivalry between the consultancy groups in the Australian industry, especially in Melbourne, is intense. This means that the company must be continually vigilant on the improved practices that the competitors are engaging in and therefore establish practices that are more viable in an effort towards vending competition off (Altman, 2008, p. 600)
In the recent past, the sensitivity of the price of solar energy consultancy products as well as services has changed in a significant way. Further, the demand for a variety as well as the level of emphasis on consultancy service, in addition to, support has changed.
Another relevant change that has taken place in the near past is regional trends. This consultancy group sees these changes as vital since, through them, it is easy to establish new opportunities, in addition top, threats.
This consultancy group has access to essential resources, which are unique. In addition to this, the group has the capabilities of achieving economies of scale in the solar energy consultancy industry. The group also has an access to solar energy consultancy services and products distribution channel.
Further, the group has experienced an excellent technological progress. The company sees these as key success factors and as such, they are essential, as they will assist the company in its efforts towards achieving the marketing objectives.
However, the company is aware that these key success factors will change going into the future, especially as the consultancy products as well as the service progresses through their life cycle (Mills, 2008, p. 55).
Distribution Channels
Existing channels of distribution
The consultancy group ensures that it contacts its clients in a direct manner.
Trends and emerging Distribution channels
The company has recently embarked on efforts aimed at discovering new distribution channels for its consultancy products as well as services in an effort towards developing a competitive advantage, in addition to, enhancing its market share.
