Anyone in the space of Solar in Australia?
December 14, 2024
by a searcher from Bergische Universität Gesamthochschule Wuppertal in Bochum, Germany
Hi there,
I am trying to get a better understanding of the solar environment in Australia (NSW, QLD, VIC). However, having talked to a few retailers and installers, the feedback vaires a lot, especially when it comes to margins. While many say that they are suffering high competition and shrinking margins, others claim to have solid EBITDA margins of above 20%.
Anyone experience on the margins of solar installers and retailers?
There are over###-###-#### installers in Australia, but does anyone know the number of retailers?
Best, Tab
from University of Melbourne in Melbourne VIC, Australia
Tabraiz, your experience doesn't sound off for an industry like this with a large number of players and a long distribution. There will be a very long tail in that 7000 installers, of which I expect many would just be individual contractors. In a space like this margins will vary - I guess that's what search is all about - find the higher margin businesses and work out if their position is defensible and the margins will hold. I think it's a suck it and see problem - you just need to get searching and see the financials of a range of businesses in the segment. I don't think you'll get an accurate number on the number of solar retailers.
Solar in Australia currently has government subsidies, and is going to have some risk around that - the B2C space is notoriously full of cowboys. The government in the past has subsidised rain water tanks (during water shortages), and also ceiling insulation - in both instances the government pulled the subsidies overnight and demand tanked in both industries taking many businesses under. I saw that first hand when the company I was with sold fire retardants into roofing insulation - it went boom to bust over a couple of years. There are B2C marketers who have moved from one government subsidy program to the next - a few of the cowboys doing roof insulation are now doing solar.
from University of Technology Sydney in Sunshine Coast QLD, Australia