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Feb 2, 2017 — This Los Angeles area solar sales company has developed a marketing system that provides them a steady residential customer base and has allowed them to achieve explosive year over year growth, however they still have an unbelievable remaining profit potential! With the solar tax credit program extended to 2021, this company is poised to capture financial windfall and has the capacity to more than double in size. Unlike some firms, this one only sells residential solar systems as well as complementary energy efficient products (e.g. roof, windows, air conditioning and insulation) home improvements (e.g. pain, air ducts, electrical panel upgrades, etc.).
This 2,300 square foot office leases for $4,300 per month. The office is on a secure short term lease, but may also be related as necessary as it is not vital to the business. All of the business's furniture, fixtures, equipment, goodwill and contractors licensing agreements will be included in the sale. Up to $500,000 in working capital and $2.0+ million in accounts receivable will not be included in the sale, however, $300,000 - $400,000 in work in progress will be included.
As high energy rates, coupled with a warm climate and an environmentally conscience population make Southern California and ideal market for alternative energy solutions, competition naturally exists. This company, however, has developed a formidable sales strategy that surpasses the competition in terms of effectiveness and cost efficiency. This approach, together with a fantastic leadership, sales teams and an ideal installation partner, provide this firm with a strong long term competitive advantage that a strategic buyer may incorporate or a an industry entrant may capitalize on to make their mark in this bourgeoning industry.
This company has several obvious opportunities for growth. 1. The firm does not do its own installation, but estimates they could generate up to $1.0 ml. in profit by doing so. 2. The company does not offer a lease option for those who cannot purchase or won’t qualify for financing. They walk away from lease candidates. 3. Tremendous monies can be made by offering customers an in- house financing option. If capitalized, the company would have saved nearly $200,000 in 2017 financing fees and created a 20 year residual income stream while further increasing their sales close ratio. 4. The company focuses on homes within an 80 mile radius, but could expand this focus to alternate markets. 5. They have the capacity to more than double their lead generating efforts with existing capacity and supervisory staff. 6. They derive 20%+ of revenues from energy efficient add-on sales that can be also be favorably. Finally, 7. The company does residential solar but they could also service the commercial market.
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