A Bright Forecast for a Solar Panel Installation Franchise
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In 2007, after several years as a Quiznos franchisee in the Bay Area, Joe Bono thought back to his middle school science class. He remembered learning about satellites and how they were completely powered by solar cells. It seemed inevitable that by the time he grew up, everything would be powered by the sun.
"It was 20 years later, and I realized solar had hardly penetrated the market," Bono says. Yet cheaper solar panels, tax credits and a push for energy conservation had primed the market. All that was needed was a reliable service company to get the panels on garage roofs across the country. So in 2008, after selling his sandwich shops, Bono launched Solar Universe, a solar panel installation franchise headquartered in Livermore, Calif.
Franchisees help their clients work through the maze of state and federal rebates and tax credits, as well as utility company regulations, before erecting a solar array on the roof. For most customers, a 5-kilowatt system is big enough to keep the internet and the microwave humming and usually pays for itself in about eight years. In 2011, the company is introducing solar thermal for hot water heating, and energy efficiency consulting. It's already launched the BriteLease rental program, which allows even more people to catch rays.
Solar Universe's 24 franchises are spinning electric meters backward in California, Illinois, Arizona, Nevada, Pennsylvania, Maryland, Louisiana and New Jersey, and Bono thinks he can double his units by the end of the year. A $7-million cash infusion by RockPort Capital Partners earlier this year has also juiced the company. We talked with Bono about his sky-high plans for Solar Universe.
How did owning sandwich shops influence your solar biz?
Quiznos taught me that with franchising, you can run things as efficiently as a Swiss bank even without the highest levels of talent. There is a built-in system of checks and balances inherent in the model. If you follow the system, it works. I was able to apply that same formatted system to solar and grow faster with better service, safety, quality and consistency. Our delivery system has the benefits that come from being a large corporation, but preserves the entrepreneurial spirit of our franchisees.
You don't think of yourself as a franchise. Why?
I call our business model a network partnership. Our royalties are very small, around 3 percent. We take a very hands-on approach. Most franchises seem to help with the store opening, then you're on your own. We stay in contact every week. We offer an educational series, a competition series, sales drives and promotions. There's a lot of mutually beneficial give-and-take that's ingrained in our franchise model, which makes it more of a partnership.
If the tax breaks go away, will solar still be affordable?
We're always concerned with public policy and how it drives incentive markets. But there are a few things out there baked into the tax code long-term that will get us to where we want to be. There's a 30 percent tax credit lasting through 2016, which should give solar enough ramp-up time to achieve grid parity, which means buying power from your roof costs the same as buying from a utility. The cost of equipment is coming down dramatically. Solar will soon be economically viable with or without subsidies.
What's more satisfying: Making sandwiches or making energy?
We talk about the "hug factor" in solar. A lot of times we get hugs at the end of an installation or when a customer sees their power bill zero out. I've worked in software and restaurants, and I didn't get touched quite as often.