How to Start a Solar Panel Installation Business in Australia | finder.com.au

How to start a solar panel installation business

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As the world becomes more environmentally conscious by the day, more Australians are turning to solar power as a responsible energy source. Right now, there's huge demand for solar power installation services, so you may be thinking of starting your own solar business to secure a portion of the market.

So what kind of skills and qualifications does opening a solar panel installation business require? We take a closer look in this handy guide.

What is a solar panel installation business?

Solar panel installation services install solar power systems for homes and businesses. This involves installing solar panels on the roofs of homes around Australia, as well as installing the inverter and connecting the necessary wiring. Solar panel businesses also maintain solar systems and repair damaged panels when required.

workers installing solar panel

How to start a solar panel installation business

How can you get started in the world of solar? These simple steps will get you up and running:

  1. Choose your target market. The first step is to find a target market. Think about which areas you will service, whether you'll focus on home or commercial solar installations, and if there's a big enough market for your business in the local area.
  2. Put together a business plan. A good business plan sets out what your business will do, how you'll attract customers and make sales, and how you'll turn a profit. It's a great way to outline your goals and how you plan on reaching them, and is also an essential document if you'll be applying for finance. Check out our guide to creating a business plan for more information.
  3. Decide how to structure your business. Some solar panel installers start out as Sole Traders, while others opt for Partnership business structures or even form a Company. Each option has pros and cons which we'll look at in more detail further down the page.
  4. Get licensed. You can't install solar panels without the proper licence, which is usually an electrical contractors licence, but can be a building contractors licence in some cases. However, licensing requirements vary from state to state and could also depend on your business structure, so check the regulations in your area.
  5. Choose your suppliers. You'll need to think about where you'll be sourcing solar panels, inverters, racking/mounting equipment and other essential items. Shop around to find a wholesale supplier that offers quality products and good value for money.
  6. Calculate pricing. Work out how you can price your services to ensure that you attract customers in a competitive market while still turning an acceptable profit. Research your competitors' prices, and take all your startup and ongoing costs into account to calculate your ideal rate.
  7. Sort out finance. Now it's time to consider your finance options to provide the capital needed to launch your business. Consider the cost of equipment, advertising, transport and more when deciding how much you need to borrow. Find out more in our guide to business loans.
  8. Take care of legal requirements. What legal documents will you need to have drawn up for your business? As well as services and wholesale agreements, you'll also need to consider employee contracts and things like privacy and cookie policies for your website. Liability insurance and cover for risks like having your tools damaged or stolen are also essential.
  9. Find customers. The final step is to get to work and start building your customer base. From word of mouth and your own network of contacts to advertising and setting up a social media presence, there's plenty you can do to attract new customers.

What do I need to start a solar panel installation business?

You'll need a range of skills, qualifications and specialist equipment to set up a solar panel installation business. Let's break these down into different categories to give you a better idea of what's required.

Essential skills

To be a solar panel installation business owner, you don't necessarily need the expertise to install the solar panels themselves. You do, however, need to have a solid understanding of how solar works as well as an overview of the market.

It pays to be business savvy in this industry too, especially when it comes to negotiating deals on solar panels and pricing up jobs. With a large team of experts working underneath you, you'll need to know how to manage a team effectively. Keeping the business running like a well-oiled machine while making sure everyone is happy and performing in the role is key.

Remember that solar power is constantly developing. To stay ahead of the curve, you'll need to keep up to date with the latest technology available on the market.

Courses and qualifications

If you're planning on doing the installation yourself, you'll need to become a qualified solar installer. This can be achieved by completing an apprenticeship or an accredited training course.

While an apprentice learns on the job over a few years, a course takes an average of 5 days to complete, and costs between $2,000 and $3,000.

Depending on the requirements of your state, you'll also need to have an electrical contractors licence in your own name or in the name of your company. Licensing requirements can be complicated, so check with the relevant authority in your state to find out what's required.

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    Tools, equipment and software

    There's a huge amount of technical equipment and niche tools involved in solar panel installation.

    First, you'll need equipment for the systems themselves, including:

    • Solar panels
    • Charge controllers
    • Batteries
    • Power inverters
    • Solar panel racking
    • Wiring

    Second, you'll need to think about the tools needed to install a solar system. These can include:

    • Fish tape
    • Hole saw
    • PV tester
    • Fall protection equipment
    • Safety equipment

    Finally, you'll need to consider any office equipment and software you may need to look after the admin side of your business. This can include:

    • Accounting software, such as Xero or QuickBooks, to help you manage your business finances
    • Job management software, for example Tradify or Ascora, to help keep track of your workload, scheduling and invoicing

    How to structure your solar panel installation business

    Deciding how to structure your business is one of the first big decisions you'll make as a business owner, as well as one of the most important.

    Most solar panel installation businesses will opt to register as a Company as it allows the business to grow without limitations, reduces your personal responsibility and minimises your tax liabilities. However, a company is one of the most expensive and complicated business structures to set up.

    You can also choose to register your business as a Sole Trader or Partnership. Although much simpler and cheaper to set up, these types of structures give your business less flexibility to grow. You will, however, benefit from maintaining control over the day-to-day decisions of your business, and you can always change your business structure later down the line once it starts to expand.

    Setting up a solar panel installation business can get complicated, but with the right legal help and advice it can be made much simpler.

    If you're not sure how to get started, here are a few legal documents you'll need:

    Services Agreement

    Each job you take on will need its own Services Agreement. This is a legally binding agreement between you, the service provider and your customer that outlines the expectations of the agreement. It should include details of the installation service that you'll provide, the agreed price and a timeline. It'll also outline how any disputes will be resolved.

    Wholesale Agreement

    For a business, it's generally more cost-effective to buy things wholesale and that's no different with a solar panel business. When you do decide to buy wholesale, it's best practice to enter into a Wholesale Agreement with the supplier.

    Employment contracts

    Whether you decide to take on staff full time or engage with freelance contractors, you'll need to have an agreement in place that outlines the obligations of both parties and remuneration.

    Licences

    As well as your business registration, you will need to be licensed to carry out your solar installations legally. You can check with your state as to which licences are required or use the Australian Business Licence and Information Service (ABLIS) to find out more information.

    Website requirements

    It's a great idea to create a website for your business. You'll need to get all the necessary policies and Terms and Conditions written up. This may include a Privacy Policy, Cookie Policy and Click-Wrap Agreement.

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    Insurance for a solar panel installation business

    Insurance is another key consideration before you get to work. The cover you require will vary depending on the size and type of business you're running, but some of the main options to consider include:

    You may also want to insure your business stock against theft or damage, or be required to take out workers compensation cover for your employees. It's a good idea to make an appointment with a business insurance broker to find out what cover you need for your business.

    How to find customers

    Digital marketing is a key element for any successful business. By building an online presence with a website and social media channels, you'll grow brand awareness and add more credibility to your business.

    For a hassle-free way to market your services, you can also take advantage of platforms like Airtasker, hipages and Oneflare. These online marketplaces connect locals who have jobs to get done with local tradesmen that can do the work for them.

    Online advertising, email marketing campaigns and good old-fashioned word of mouth can all help grow your business too. It's all about finding a cost-effective marketing strategy that works for your business, so expect a little trial and error before you find the best approach.

    How much to charge customers

    Every project you take on as a solar panel installation business will need to be priced independently according to the size of the job and the type of solar panels the customer wants. A residential job may cost as little as $3,000 or as much as $13,000 depending on the job specifications. You'll also need to consider your own overhead costs, as well as the prices of your competitors, when setting your rates.

    Before you start a job, it's best practice to provide each customer with a solar quote. This should itemise the hardware you'll supply for the jobs, your installation warranty, and any solar rebates that the customer may be eligible for.

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    Frequently asked questions

    How much does it cost to start a solar panel business?

    The cost of opening a solar panel business is high, as you'll need to invest a significant amount of money before you can get started. Equipment costs, marketing, hiring contractors and investing in the correct licences can all add up to a significant investment.

    How much money does a solar panel installer make?

    According to Indeed, some of the highest-earning solar panel installers earn $96 an hour. How much you get paid depends on where you're working and your experience in the field.

    Is a solar panel business profitable?

    A solar panel business can be a profitable venture, especially if you're willing to invest time and money into making it work. However, just like a business in any other sector, there's no guarantee of success.

    The good news is that there's much you can do to improve your chances of turning a profit. By providing a reliable and high-quality service, developing a suitable marketing strategy and setting competitive prices, you'll be setting yourself up for the best chance of success.

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