How to Start a Solar Panel Business?

A solar panel business offers ample growth opportunities with large profits. Since solar energy is one of the most widely available resources, the government also offers various schemes to encourage adaptation. Considering the depletion of resources, the demand for solar business is bound to increase in the coming years. 

Starting a business in the field of solar energy needs sound financial backup and political acquaintance. Refer to this guide to learn how to start a solar panel business.

Steps to Start a Solar Energy Business

Starting a solar energy business is a great way to save the environment while earning a decent profit margin. Follow these steps to get started:

Create a Business Plan

Creating a solar panel business plan involves managing the investments, sourcing raw materials, team arrangement, training, business strategies, marketing strategies, sales techniques, equipment assembling, contacting manufacturers or suppliers, etc. 

A detailed plan contains all the necessary details about your business background, budget, workers, techniques, strategies, working capital investment, raw materials, equipment, location, etc. When you approach a Business Loan provider or investor for financial support, they will require this business plan to make their decision.

Market Research

Market research related to different field-related components and aspects is essential before setting up a solar business. Proper research increases the chances of business success. Conduct research in various aspects of the solar energy business, including parts, equipment, marketing, infrastructure, hiring, competitors, contractors, suppliers, target audience, etc.

Legitimising and Authorising Business

Legitimising the business by registering it as a company is essential. Under the Company's Act 2013, you can register the company as a proprietorship, LLP, partnership, or sole private or public limited company. 

Apply for an Employer Identification Number (EIN) to register for taxes, obtain a Certificate of Occupancy to operate from a physical location, and get business insurance to protect your company against loss. Here is a list of documents, licenses, and certificates required for a company’s registration:

• GST registration
• Company or LLP registration certificate
• Company’s PAN and bank account number
• Sales Tax and TIN numbers
• Certificate of Commencement 
• Article of Association (AoA) & Memorandum of Association (MoA)
• Shop and Establishment Act License

Also Read: How to Start a Business from Scratch in Simple Steps

Connections with the Government's Electricity Department

The government already supports solar energy business ideas to conserve energy and save the environment. Therefore, connecting with the electricity departments will save significant money and effort. Take advantage of any lucrative schemes the department offers its customers or sellers. Connections with authorities will always benefit your business and reduce the chances of complex issues.

Suitable Location

The location of your business largely affects its chances of success. It becomes even more important for a solar business that largely depends on its strategic location to receive ample sunlight. Solar energy plants must be located in a place that receives a high density of the sun.

Also Read: How to Start a Clothing Boutique Business - Complete Guide

Finance Management

Finance is the most crucial aspect of a business. Consider these factors to make a precise estimate of the costs involved:

• Infrastructure
• Land or space
• Machinery, tools, and equipment
• Staff and employees
• Maintenance 
• Marketing 
• Training 
• Raw materials
• Legal expenses

Also Read: How To Start A Startup In India In 5 Steps in 2023

Hiring the Perfect Team

Workers are the key asset of a company. Hire skilful and efficient workers to produce the desired results. Since solar energy is still a new concept in India, you must train them to use the equipment safely and efficiently.

Types of Solar Energy Companies

You can establish three types of companies in the solar energy sector:

1. Manufacturing Business: Produce accessories and items for the solar industry. 
2. Services: Offer services like installation, maintenance, repairs, and other services in the solar industry. 
3. Sales and Marketing: Generate demand, create leads, and convert them into sales through digital marketing or website building.

Also Read: How to Start Your Own Trading Business in India

Types of Engineering Segments

A solar energy business may work in any of these engineering segments:

1. Electrical Engineering: Involves protection, inverter, cabling, solar panels, and switchgear
2. Civil Engineering: Handles cement blocks to support the module mounting structures
3. Mechanical Engineering: Deals in module mounting structures

How Business Loan Can Help You to Expand a Solar Panel Business?

Here is how a Business Loan from Hero FinCorp can help you to expand a solar business:

• Ample loan amount of up to Rs 40 Lakh to cover various expenses
• Competitive Business Loan interest rate, starting at 14%, that keeps the loan cost under control
• Flexible repayment terms, 12-60 months, to manage the EMIs efficiently
• No need to share the profits or company ownership 
• No need to exhaust your savings on the business
• Freedom to use the loan amount for any business-related purpose
• 100% digital loan procedure 
• Instant approval and quick disbursal

Also Read: How to Start an Online Business from Home in 8 Steps

How to Apply for the Loan to Expand the Solar Panel Business?

Are you ready to apply for a Business Loan to set up your solar energy business? Follow these application steps:

• Visit the Hero FinCorp website.
• Enter your desired loan amount and select a suitable repayment tenure using an EMI calculator.
• Go to the Business Loan page and click Apply Now.
• Fill out an online application form.
• Scan and upload the necessary documents.
• Receive a reference number.
• A representative will get in touch for more information if needed.
• Review the loan offer in your email address.
• Once you accept the offer, get disbursal directly into your bank account.

Also Read: How to Start a Food Business From Home in 2024

Conclusion

Solar energy is a booming industry with lots of opportunities and high growth potential. Moreover, its demand will only increase in the industrial and agricultural sectors due to frequent power cuts. Besides, it is a renewable energy source that benefits the environment and the entire human race. Are you planning to establish a solar energy business in India? Get the required funding from Hero FinCorp and repay it at your convenience.

Also Read: How to Start Your Own Clothing Brand in 7 Steps

Frequently Asked Questions

1. How profitable is the solar business?

Since the solar sector is flourishing, setting up a solar business is a lucrative and profitable business idea.

2. What is the minimum investment for a solar energy business?

You will require an investment of around Rs 10 Lakh to set up a solar energy business. 

3. How much profit can you make with solar panels?

The gross profit margin in the solar business is around 15-20%, depending on the size and nature of your company.

4. Can I use a Business Loan to purchase solar panels and related equipment?

You can use the loan amount for any business-related purpose, including purchasing solar panels and related equipment.

5. How can I qualify for a Business Loan for my solar panel business?

Check the lender’s eligibility criteria to qualify for a Business Loan. These include your age, business age, credit history, repayment capacity, debt-to-income ratio, and related documents.