PV Technologies
Marketing Management
1st Term 2012
Case: PV Technologies
1. What do we really know about this situation?
We know that along with PV Technologies, two other companies – SOMA Energy and BJ Solar are in the supplier’s shortlist that Solenergy has to provide a large quantity of utility scale central inverters for a PV solar energy power plant. Each of these companies sent their proposals, and a final decision is being reached by Solenergy.
If the two competitor rely mostly on lower prices of their product, PV technologies rely on their superior efficiency and a warranty of 10 years, the double that each of the direct competitors offer.
In terms of market, we know also that many governments have long-term objectives that will probably keep alive public and private investments in renewable energy power sources, where photovoltaic segments have a solid ground.
2. Is this just a brush fire or an important problem?
It’s an important problem, because if the rumors are to be believed, PV Technologies are in verge of losing the contract, and this deal is strategic not only because of the large profits that it can generate, but mainly for the visibility impact that it’ll have in the marketplace, possibly a dramatic one if the contract is lost. That would have a negative impact not only in the solar plant segment, but in consumer segments too.
3. How profitable is each of the four alternatives suggested?
The rationale behind on first alternative is the offering of an extended 10 years warranty with special conditions. The customer pays 18% of the purchase price of the inverters at the beginning of each year included in the extended warranty period. This sum, however, cannot be considered profit, because eventual money not spent on maintenance is returned to the costumer at the end of the year. The total profit in this scenario is $7.128.000, for a period of
20 years.
The profits in the 4th alternative are not known, for they depend on further
1st Term 2012
Case: PV Technologies
1. What do we really know about this situation?
We know that along with PV Technologies, two other companies – SOMA Energy and BJ Solar are in the supplier’s shortlist that Solenergy has to provide a large quantity of utility scale central inverters for a PV solar energy power plant. Each of these companies sent their proposals, and a final decision is being reached by Solenergy.
If the two competitor rely mostly on lower prices of their product, PV technologies rely on their superior efficiency and a warranty of 10 years, the double that each of the direct competitors offer.
In terms of market, we know also that many governments have long-term objectives that will probably keep alive public and private investments in renewable energy power sources, where photovoltaic segments have a solid ground.
2. Is this just a brush fire or an important problem?
It’s an important problem, because if the rumors are to be believed, PV Technologies are in verge of losing the contract, and this deal is strategic not only because of the large profits that it can generate, but mainly for the visibility impact that it’ll have in the marketplace, possibly a dramatic one if the contract is lost. That would have a negative impact not only in the solar plant segment, but in consumer segments too.
3. How profitable is each of the four alternatives suggested?
The rationale behind on first alternative is the offering of an extended 10 years warranty with special conditions. The customer pays 18% of the purchase price of the inverters at the beginning of each year included in the extended warranty period. This sum, however, cannot be considered profit, because eventual money not spent on maintenance is returned to the costumer at the end of the year. The total profit in this scenario is $7.128.000, for a period of
20 years.
The profits in the 4th alternative are not known, for they depend on further