Dan Gretsch, Vice President, SOLARHOT
The most difficult challenge facing the industry over the past year is also the greatest opportunity going forward — the speed of change. A lot of players in the space built their business plans on a certain planned growth in their target markets or in their target technology, i.e. CSP focusing on utilities or PV start-ups focusing on getting “high cost” silicon out of their product.
While solar has tried to act as the market disrupter in the energy space, solar executives have been serially blind-sided by changes in their own market dynamics. Obviously, having your target market disappear or your chosen technology lose it’s competitive advantage can unbalance the best of companies, but the reason so many solar companies have been failing at all levels is because the industry as a whole has been focusing on the top line and ignoring the profit line.
If we want to be around and thrive we need CEOs and managers that are focused on the bottom line as much as the top line. Focusing on the bottom line might mean that as an integrator you have to pass on a big job because the developer has squeezed you so much that it no longer makes sense for you financially. Focusing on the bottom line might mean that manufacturers capitalize more slowly proving the profitability of their product before pursuing the large investment.
I think the key to leading the industry into a bright future will be players in the solar space treating their businesses with the same attention to the numbers that every other industry does. Next time you solicit a round of funding imagine the investors response if you were offering to manufacture, distribute, or install toilets. Would your investors be so impressed with your numbers that they would still invest? Or maybe they would pass on toilets but only invest because they are star struck — you are selling an investment in solar.
Dan Gretsch is VP and co-founder of SOLARHOT, a premier solar thermal manufacturer based in the Raleigh North Carolina area. Dan has his Bachelor’s and Master’s degrees in Industrial Engineering from Georgia Tech. Dan is Chairman of the Board of Ecolibrium Solar a ballasted PV mounting systems manufacturer.