MBA Project 4 C Solar US Market

Market analysis is determined to be the qualitative and quantitative assessment of a market based on various aspects. However, the primary aim of the paper is to conduct US market analysis by determining the size, growth, and trend of the market along with customer analysis. 

US market has experienced steady growth for five years to 2019 by increasing growth in internet advertising expenditure along with research and development. It provides dynamic and efficient opportunities for companies to operate a business in the US. The US market is the largest consumer market across the world, which possesses the potential to attract a considerable consumer base by fulfilling their needs. As a result, it helps most of the companies to increase their sales volume. While preparing products or services, companies in the US focus on the quality, needs, and expectations of the consumers (Hatheway, Kwan & Zheng, 2017). However, through increasing variety and lowering the cost of the products, the US market provides various advantages to its consumers. It determines consumer behavior by acknowledging that the majority of customers like cool brands. Operating in the US market, companies are required to follow specific regulations like licensing duties and customs regulations along with Consumer Data Privacy Laws. According to the US Department of Energy, solar energy is more prevalent, accessible and affordable than before. Solar-friendly laws have widely contributed to the growth of the solar industry in the US. The list of federation laws are:

Department of Energy Organization Act of 1997: The purpose of this Act is to ensure America’s prosperity and security by addressing its energy, nuclear and environmental challenges through technology solutions and transformative science.

The Federal Power Act of 1935: It coordinates the development of hydroelectric projects in US more effectively.

Federation Energy Regulatory Commission (FERC) Orders 890 and 1000: It transmits the provider’s requirement to organize transmission planning at the local and regional level. It provides flexibility to methods of cost distribution of transmission upgrades.

FERC order 2006: Its purpose is to address interconnection standards for small generators.

Energy Policy Act of 2005: This law focuses towards promoting energy self-sufficiency and improvements in US. It also includes considerable changes in interconnection legislation.

FERC Orders 819 and 827: This provision deals with the sale of primary frequency response services by sellers at market-based rates for sales of capacity and energy.

Canadian Solar Inc. will benefit from these laws to operate its business in the US by offering homeowners and solar customers with solar panels at an affordable rate. The company strives to meet the handful regulations such as FERC Orders 890 and 1000 by improving transmission planning and allocating the costs of transmission upgrade to minimize financial burden. Within their corporate governance policy, the internal regulation of the company is to ensure that the employees comply with specific laws and regulations. This involves occupational health and safety, environmental hazards, illegal political environment, insider trading, copyrights and bribery.

Therefore, the products are created by utilizing features such as social consciousness, the leading fashion, and cutting-edge technology. Solar panels features provide 100% renewable and clean energy and give control and freedom over electricity to US consumers. One of the great benefits of using solar panels is that it is cost-efficient. Consumers can see significant savings in the utility bill. Consumers can also enjoy affordability based on the availability of local, state and federal tax breaks. The motive and or the mission would be to increase technological advancement in the future to enhance the experience of US consumers. It is worth noting that the buyers are highly involved in the purchasing process where the influencers are the one who influences the purchasing decision. While the buyers acquire a service or asset, and users use the services or products. Therefore, this research could help Canadian Solar Incorporation, a publicly-traded organization in Canada, service solar energy solutions as well as solar PV modules to its US consumers in affordable price (Inc, 2019). To enter the US market, it must provide a variety of solar products to attract more consumers by understanding the characteristics and behaviors of consumers. The company must also adhere to the market regulations to avoid facing any difficulties in operating its business in the US.

The market size of the US in 2019 is estimated to be $1.7, where its market size growth in 2019 has increased by 2.2%. Meanwhile, the revenue of the US market in 2019 is estimated to be $547,690, which is higher as compared to the revenue gained in 2018, which is $501,012 (Inc, C., 2019). Hoium notes that the US market has the most attractive market for solar manufacturers. Canadian Solar Inc. has acquired nearly about one-third of its revenue from the American market. Comment by Sandra Ducoffe: Are these figures for the solar energy market? Or the solar panel market? It is not clear what you are referring to here. I’m also not at all clear how this information can come from the article you are citing (which is about a very specific SINGLE installation of solar panels).

US market focuses importantly on enhancing economic growth by increasing the GDP rate by 2% and by reducing the price level for customers (Wang, Xie & Chen, 2017). Thus, depending on its considerable size and market, the US market could provide various opportunities to Canadian Solar Incorporation, and enhance its economic growth as well. The market size of the US will help the company to invest more in developing solar panels and met the consumers' requirements. Comment by Sandra Ducoffe: Here you should be reporting on the entire market. What is the overall size for the solar panel market? What is the growth rate overall?

Comment by Sandra Ducoffe: This is a source about mutual funds NOT about the solar panel industry…

Figure: US market size

(Source: Muñoz, Vicente & Ferruz, 2015)

3.3 Market trends 

The US market focuses mostly on making efficient use of information technology (IT) and advanced manufacturing capabilities throughout its product lifecycle. These market trends help manufacturers in the US to get benefits from excellent consumer support, faster production time, and substantial cost along with increased visibility into operations. Approximately 63% of the manufacturers within the US market utilize the Internet of Things (IoT) to create products that help in increasing profitability (Mollah, Quoreshi & Zafirov, 2016). IoT is a system that interrelates digital and mechanical along with computing devices and possesses the ability to transmit data over a network without human-to-computer or human-to-human interaction. In the next five years, the US market is all set to invest $267 billion in IoT. Considering the US market trend, the US market has transformed from B2B to buying centers that provide opportunities for organizational members to get involved in the buying process. Comment by Sandra Ducoffe: Again, this section should be about trends in the SOLAR PANEL industry.

Hence, Canadian Solar Incorporation may apply all these market trends while executing business in the US market and serving high-quality products to the customers. The use of buying centers will allow the company to influence the buying decision of the individuals engaged in making a buying decision. It is seen that the solar power industry in the US has received favorable government incentives in 2019 in the form of tax credits and renewable portfolio standard targets. It will help the company to invest in making solar panels for US consumers. There is increase in customer size.

Buying process

US market determines the consumer buying proc

ess by identifying their wants and needs, evaluation of purchase, choices, and information search.  Comment by Sandra Ducoffe: Here, you need to discuss the concept of the Buying Center from our lengthy reading about Business Buying Behavior. Then, you need to find research about the companies that buy solar panels and discuss those.

Financial arrangements in purchasing

US market provides various payment options where they can pay money with the help of technology. Near about 64% of the consumers in the US prefers using debit cards and mobile payments (Rejeb & Arfaoui, 2016).  Comment by Sandra Ducoffe: These are residential customers but this plan is about the B2B market NOT the residential market.

Distribution

The consumers in the US are provided with high quality and convenient products by providing them options to buy products through in-store and online shopping channels. The products and services are distributed to consumers through franchising, retailing services, wholesale trade services, and commission agent's services (Reader, 2018). Hence, the company must use these distribution services for selling its products and services. Based on distribution and logistics, most of the companies make efficient use of the road for carrying out the products. It is suitable mode of delivery as it provides operational flexibility. The products are distributed in urban areas by using trucks. Moreover, there is extensive use of intermodal distribution that allows the interconnection among land and maritime transportation. On the other hand, air transportation for distributing goods plays a growing role in international logistics in the US. Thus, the company may use all these distribution and logistics for distributing its solar products in the US market, in the states such as: California, Texas, Pennsylvania and Mississippi. California was essential to the market's early years and remains a critical support today, however its importance is diminishing as other state markets grow up. California accounted for fifty one % of the first million installations however 43 % of the second million. Comment by Sandra Ducoffe: Again, this plan is NOT about customers like me and you purchasing solar panels. It is a B2B plan. How are panels distributed to the business market? How are they transported? Warehoused? Where do they come from?

Although the drive, the U.S. solar market has shown some challenges due to a drop in home market (Merchant, 2019).

Seasonality 

Conclusion  Comment by Sandra Ducoffe: You will not have a conclusion to this section in the final plan.

The paper helped in analyzing the US market by determining various aspects that may help Canadian Solar Incorporation to enter into the US market and operate its business effectively. The US market provides enormous opportunities for companies to execute their business. Considering the US market’ size and growth, the company should be able to invest in solar panels to service its customers in the US. The production and it its expansion should include an emphasis on technological advancement, specific, achievable, realistic, and measurable goals. It should furthermore provide various distributions services. 

Edeling, A., & Himme, A. (2018). When does market share matter? New empirical generalizations from a meta-analysis of the market share–performance relationship. Journal of Marketing, 82(3), 1-24.