To date, Solar Electric’s contracts are split 80% to 20% in favor of electrical contracting, and he makes “a decent profitâ€ from electrical work with established clients. However, the time and energy he’s putting into drumming up solar work is well worth it since there’s less competition for solar contracting in his area and profit margins range between 15% and 20%, Holston says. “There’s a greater volume of electrical work, but there’s more competition for that work. I might have to bid against eight or nine contractors to get it. In that case, the client is willing to pay less for the job and the problem you run into is working on a contract at cost.
By summer, Holston hopes to see a 50-50 split between the electrical and solar work his company completes, but he has no plans to concentrate solely on solar. “In the next three to five years, maybe we can grow to 80% solar and 20% electric, and that would be nice, but we’re a full-service electrical contracting company, too, so I don’t think we’ll ever go 100% solar. Putting in a solar energy system also entails working on the electrical system. However, we do plan to be the best at what we do.â€
This article originally appeared in the May 2009 issue of Black Enterprise magazine.