Even though Luxembourg isn’t famous for its sunshine, the leading European online shop for photovoltaic equipment and its leader Erick Durand, a French entrepreneur, set up shop here.
(Featured Image: Erick Durand, Founder of Alma Shop / Image Credit © Silicon Luxembourg / Anna Katina)
Identifying a need
Alma Shop opened its doors in 2011. It sells photovoltaic equipment via its online store, published in 5 different languages, from Luxembourg.
Previously, I worked in the distribution of solar panels: studying, estimating, and providing commercial aids and displacements on site. Despite a holistic, complete offer, my company lost a lot of contracts. It’s true that during the photovoltaic boom from 2006 to 2012, installers had high margins on equipment (40% on average). But after that, mostly on big projects, competition was tough—and still is—so we had to adjust our pricing. Despite our best efforts, our margin was only about 3%.
I made the decision to create the company Alma Shop based on 4 observations:
- In my previous job (distribution of solar panels since 2009), I realized that 50% of customers made contact directly through the company website because of our SEO and relevant, targeted content;
- I conducted a questionnaire with my relatives. The purpose of the questionnaire was to evaluate the market. I asked, “If you had to buy solar panels, where would you buy them?” Not a single person out of thirty was able to respond confidently and distinguish between distributor, installer, reseller, wholesaler and retailer.
- Someone needed to put a commercial solution in place to limit installer margins. The idea was to set a competitive public price to remove this abuse. The photovoltaic market is new, so no manufacturer was able to define such a pricing policy for the general public and professionals. Online sales allowed me to seize the opportunity.
- Finally, on Google, I searched terms like “how to buy solar panel on the internet” or “solar panel price.” To my surprise, I realized that there were only 2 online sales sites, one of which was in Germany.
I limited analysis to these few points, and I embarked on my solar panel adventure.
“Electricity rates continue to rise across Europe, and consumers are increasingly aware of the energy savings they could have.”
A Wobbly Start
The Alma Solar site appeared on the web in early 2011 and became active in July 2011. I invested the last of my student savings and set out to win over manufacturers and distributors with the idea that they could overcome the stock-out. After many conversations and negotiations with several manufacturers, I managed to sign live distribution contracts. I must admit that the people who opened doors at this stage were gambling on the project as well as on me.
My business strategy was simple: “build volume” to honor my distribution contracts. There were only four brands for all 100 products on the site, with no details and no service offered. Simply a unique price, both for professionals and individuals. In September 2011 the first order arrived: € 135 for an inverter accessory that was to be delivered to Italy. I could not imagine that someone so far away trusted us. In the beginning we saw many difficulties, and each problem required a different solution. Year after year, we managed to sell a little further from our Luxembourgish borders.
The auto-consumption pivot
In 2014, the market, which was in part sponsored by European state aid, collapsed. The self-consumption market then took off. This system is even simpler: you install your solar panels on your roof or in your garden. You plug them into your electrical board, and you consume what you produce. No more administrative or state aid constraints that impose technical limitations on you.
It was then that I started to offering services on the Alma Solar site. We launched a free online configurator: by entering the surface of your roof, you get a complete quote in 3 clicks. This lets customers know exactly what they will need and how much it will cost. The commercial strategy then evolved into differentiating the price for professionals and individuals.
Since then, our offer has not stopped growing. We have signed new distribution contracts with innovative products. Domestic batteries came into play with the help of our friends at Tesla. We created the Alma Solar Academy to globalize all technical data but also help customers choose and install their equipment. The Alma Solar house highlights all the projects our clients have completed throughout Europe. Alma Solar insurance insures all at-risk equipment for 5 years after installation. Finally, we have increased the surface area of our Luxembourg warehouse to more than 300m2 over 3 levels— that’s—900m2 dedicated to photovoltaic.
“Our goal is to develop our service offer for the individual and guide our commercial proposal by offering a hardware installation solution via our installation partners, financing solutions and scalable commercial solutions after installation.”
Process automation and digitalization first
We experience an average growth rate of 30% per year. In order to meet this increase while ensuring the best customer service, I decided to automate the company. The shop is connected to software called ERP, which allows you to instantly track all the activity of a company and establish automated tasks, for example:
- Managing the purchasing department (supplier order management, restocking management, etc.)
- Managing the logistics department (customer/vendor management, stock management, consumables management, etc.)
- Financial Management (bank API connection, payment management, etc.)
- Accounting Management (customer/supplier invoice management, VAT management)
- Intrasat Management (chart of accounts management, etc.)
- Marketing Management (behavioral analysis, marketing automation, etc.)
Customer management is the only human part that requires action based on market analysis. A commercial team of only 3 people is active on the entire customer portfolio.
Mindsets are also starting to change. Electricity rates continue to rise across Europe, and consumers are increasingly aware of energy savings they could be getting. Photovoltaics is the only way to reduce their electricity bill. Our goal is to develop our service offer for the individual and guide our commercial proposal by offering a hardware installation solution via our installation partners, financing solutions and scalable commercial solutions after installation.
Alma Solar in a few numbers:
- 4000 orders / year
- 32 countries to which the team made deliveries from Luxembourg
- 5 webshop languages
- 900 m2 of storage space in Luxembourg