What is the key to successful PV business?

[Ramjam]

If you had to list a couple of top tips for running a successful PV installation business what would advise?

 

[sean_ork]

move to Spain
buy a compass and a inclinometer

 

[SRE]

Don't underestimate the time the paperwork takes and don't forget about cashflow, it will stunt your growth if you don't build it into your business plan!

 

[SolarCity]

Agreed. Do not underestimate the paperwork. It swallows your time.

 

[Noshocks]

Cash flow is the biggest issue in my opinion, this will help as module prices reduce however its a hold on growth, when i asked my bank manager for an overdraft he suggested 5k, three times this is more like it.

 

[SRE]

We're working on 20k and it's still not easy. Getting better though

 

[Ramjam]

How long do you normally take to get paid then? I was planning on taking a 15% deposit and locking it away just like the REAL assurance demand then getting the balance on handover surely that would solve cashflow issues?

 

[SRE]

Not if you've got a few consecutive orders and want to pay roofers and scaffolders quickly. I take 25% deposit and final payment on completion but it can take 7 days for a cheque to clear. It clears earlier but they can recall the payment up to 7 days. That's another 2 jobs down the line.. You just have to keep the numbers down to start off with til you build up a "pot" The other bogey is vat I've been waiting since September for registration. I'm paying 20% and reclaiming 5% - 15% gap on every sale. Also all the kit and training, MCS and trade asscoiation costs have 17.5% vat - can't reclaim it yet!!! I forgot about costing all of this in when I was working our business plan out

 

[Markc]

We work with a £20K OD from the bank. We swallow this if we have more than 3 installs in a month! As a established company we constantly use our existing funds also.

We take 15% deposit, Just under 50% of remaining balance on delivery of product to site and balance on completion (Not handover)

We instruct our customers we accept bankers draft or BACs. No cheques! and no ones offered cash (as yet) Bit strange but this money is our company on the line. Haven't had anyone argue this yet. With smart phones and internet banking offered by all the high street banks when a BACs is made you get an email conformation. Most have arranged Bank drafts and there as good as cash. No interim payment will mean we take the product back and no completion means we will not notify the job until payment is received.

I was reading with interest what people do for hand overs and time taken. We conduct first survey to produce design and quote, second survey to sign contract and determine roof bracket and anything else. On completion we return to the office and produce a handover folder which we then return back to site about a week later. Give us opportunity to look at inverter and gen meter and see what it's done. make sure its working. It also allows time for payments in full to be made. Once we have conformation of completion payment we then notify it and register the MCS etc.

This is written in to our terms and conditions and all our clients understand this prior to signing contracts.

 

[Ramjam]

Hi Mark,

That's all very interesting. Would you be willing to share your T&Cs [email protected] ?

Do you do other electrical work or are you just on Solar PV?

Best regards
William

 

[dansk]

If you need help with T&C's there is a model set here you can alter. Model Documents - Members - REAL Assurance Scheme

 

[Markc]

Hi Mark,

That's all very interesting. Would you be willing to share your T&Cs [email protected] ?

Do you do other electrical work or are you just on Solar PV?

Best regards
William

Yes, Electrical Contracting is our core business. As for the T&C's sorry we had to pay for them to be written so I don't want to just hand them out. They might not be any good anyway as they were written for our company.

Ans also see Dansk post above, He's right, on the Real website there are now T&C's to use as a starting point

 

[Selina]

We work with a £20K OD from the bank. We swallow this if we have more than 3 installs in a month! As a established company we constantly use our existing funds also.

We take 15% deposit, Just under 50% of remaining balance on delivery of product to site and balance on completion (Not handover)

We instruct our customers we accept bankers draft or BACs. No cheques! and no ones offered cash (as yet) Bit strange but this money is our company on the line. Haven't had anyone argue this yet. With smart phones and internet banking offered by all the high street banks when a BACs is made you get an email conformation. Most have arranged Bank drafts and there as good as cash. No interim payment will mean we take the product back and no completion means we will not notify the job until payment is received.

I was reading with interest what people do for hand overs and time taken. We conduct first survey to produce design and quote, second survey to sign contract and determine roof bracket and anything else. On completion we return to the office and produce a handover folder which we then return back to site about a week later. Give us opportunity to look at inverter and gen meter and see what it's done. make sure its working. It also allows time for payments in full to be made. Once we have conformation of completion payment we then notify it and register the MCS etc.

This is written in to our terms and conditions and all our clients understand this prior to signing contracts.

Thank you for your blog - it is very informative.
I am trying to set up a PV business for our company an an in the mist of writting the business plan.
Thanks again.

 

[SRE]

Sounds interesting - how much was it?

 

[SRE]

Thanks - I'm fed up with being up to midnight with all the paperwork too so if it's a reasonable price it might be worth considering. It would be cheaper than employing someone and easier than having to train someone. Only worry is that it's cheap to start off with, they get you hooked and then up the price - we'll have to wait and see...