Strategic Plan: Sun Integrators

RUNNING HEAD: SI Strategic Plan

Sun Integrators Strategy

MBA580

University of Phoenix

Executive Summary

Sun Integrators, SI, is an integrated solar products and services company that designs, manufactures and markets high-value solar electric power technologies. SI operates in the photovoltaic, PV, industry, specializing in the installation of PV residential and commercial systems. SI forecasts revenues will grow to over $15 million by the end of 2010, in a market valued at $500 million. The company will create profits as a system integrator of solar cell assemblies, purchased from silicon cell suppliers, and install and service the electric generation systems. SI will sell directly to consumer and commercial organizations.

The key challenges for SI are in securing sufficient capital in 2008 to fund the necessary capital expenditures for plant and equipment. SI’s management has devised several contingency plans to deal with potential shortages of capital during its expansion. The first contingency is to secure a line of credit from a local financial institution and take advantage of the federal government’s Small Business Association, backed loans. Secondly, SI’s management believes it can secure very favorable trade credit terms with its suppliers that will increase their cash flow during the company expansion. In addition, SI plans to use a just-in-time manufacturing system to help control and inventory costs.

The objectives of SI match the current state of the growing alternative energy market, which is a major opportunity. The PV industry forecast, in particular, will grow to over 25 percent between 2008 and 2010. While social factors, fear of fuel shortages, will help drive demand, government incentives will greatly influence the PV industry. Federal government incentives and state incentives can effectively reduce the cost of a typical consumer PV installation by up to 30 percent.

The challenges for SI are in the cost of PV, to mitigate the cost, government incentives are critical over the new three to five years. PV will become more cost effective, but the time to develop more cost efficient solar panels will take time, as long as ten years, thus the need for government incentives. However, the US government may have a difficult time allotting enough money to PV technology incentives in light of the war in Iraq and concerns about the aging infrastructure in the US.

SI feels it has the capability to build a business as it will be operating in a segment of the market that has few direct competitors and the company’s revenue and market share estimates are conservative in comparison to the total available market. The company understands solar technology and the company management has many years of experience in sales and marketing. Coupled with a growing market, even among low economic expectations, SI can be successful because of its market segment selection, its expertise and the flexibility and adaptability that a small growing company can exhibit.

SI will require $2.9 million to fund the launch of the business and investment in plant and equipment to manufacture and develop its products. Over the three year period of 2008 to 2010, SI forecast revenue of $15 million at a net profit before tax of 7.1 million. The following information describes the company, its mission, objectives and the specific details of the strategy and the approach leading to it.

Identify the organization

The organization is a new company, Sun Integrators (SI). SI is an integrated solar products and services company that designs, manufactures and markets high-value solar electric power technologies. The company owner is JES Partners, LLC. The company is located in S/W Missouri near the city of Pineville. The organization of the company is currently the two founding members who manage the operations of the company.

Background

Sun Integrators is the idea of Constance Salina, who decided to form a business after becoming disenchanted with working for large corporations and seeing a need for affordable alternative sources of electricity in the United States.

SI’s products are integrated semiconductor devices that directly convert sunlight into electricity. The industry term for devices that convert sunlight to electricity is photovoltaic. Photovoltaic, PV, is a broad category of devices that produce electric currents when exposed to light. For SI, the company uses a specific type of photovoltaic device, known as a photo-diode. The photo-diode is a semiconductor device, similar to those used in computer chips. However, the photo-diode differs from conventional computer chips as its design to reacts to light.

The management members of SI previously worked for Motorola Semiconductor Inc. and Advanced Semiconductors Materials, Inc., where they managed the design, manufacturing and marketing of various semiconductor devices. SI’s management plans to apply their knowledge and background to manufacture and market photo-diode array panels. The photo-diode array panels are commonly called solar cells.

Vision Statement

SI believes it will be the largest and most well respected mid west PV integrator, in an industry that will rival conventional sources of electricity by the end of the decade.

Mission and Values

SI is dedicated in its efforts to provide the widest range of high quality solar electric products and services to residential and commercial customers in the state of Missouri. Our one and only goal is satisfy the growing demand for sustainable alternative source of electricity by manufacturing products and providing installation services that provide superior value for customers.

SI’s values are consistent quality products and services, integrity and respect in everything we do, understanding the customer’s needs and our capabilities to satisfy those needs, continuously improve and exceed the expectations of our customers. Our company will strive to understand our customers and support them with quality products and services.

Remote Environment Analysis

Macroeconomic forecast

The US economy in 2008 declined, because of recessionary factors simulated by a downturn in