First Solar, Inc.

Table of Contents
Table of Contents 2
Executive Summary: 2
Project Scope: 3
External Analysis: 3
Internal Analysis: 6
Diagnostics: 16
Alternatives: 17
Recommendations: 17
References: 19
Appendix: 22

Executive Summary:
First Solar, a company started in 1999, has grown to become one of the world’s largest solar power manufacturing companies today. This was due to a lot of help from the recent shift in moving away from traditional energy sources which allowed the solar power manufacturing industry to become a very powerful market all across the world. With the recent rise in demand for a clean energy alternative to traditional energy sources, First Solar has been able to keep a firm hold as one of the top players in this industry. In this report we will be taking a deeper look at the solar power manufacturing industry as a whole, this will include an external analysis for the solar power manufacturing industry, doing a PESTEL analysis as well as going over industry problems within the solar power manufacturing industry, critical threats for the industry and lastly, competitor dynamics. With the research that we have done on the Solar Panel Manufacturing industry, in this report will also be a breakdown of First Solar as well. Our research on First Solar went over many of their competitor dynamics alongside a deep dive into what makes up their company.

Project Scope:
The transition from fossil fuels to cleaner renewable energy sources across the globe has been growing at an exponential rate. The solar panel manufacturing industry has played a huge role in getting the ball rolling. With new technological advances arising daily, companies are forced to keep up with one another to stay afloat and be able to compete in the industry. Over the last 5 years, this industry has generated roughly $3.8 billion dollars and has seen a growth rate of about 35.9% (Patel, 2022). This could be due to the fact that renewable energy has been endorsed by the federal government through different incentives such as tax credits and subsidies offered to individuals or companies that turn towards renewable energy. It can also be accredited to the outlook on renewable energy by society. As more begin to turn towards cleaner energy, the demand for manufacturing of solar panels will more than likely grow alongside it.
With that being said, this industry does have a few key weak points that should be mentioned. The three major weaknesses inside of the solar power manufacturing industry include high competition, very high volatility, and the high capital requirement to start (Patel, 2022). All three of these weaknesses make this industry very hard to not only get into but to stay afloat once in the industry. This industry also seems to be very reliant on the subsidies and demand is correlated with the outlook of society. Some of the key strengths that the solar panel manufacturing industry has are the high and increasing level of Helpance from the government and continued revenue growth (Patel, 2022). This industry has been getting a lot of Helpance from governments through subsidies and lowers tariffs on imports for solar panels materials. This attracts more individuals and allows for companies to manufacture at a lower cost. Another strength that this industry has would be that its projected revenue will continue to grow for the next five years. This can be accredited to the rising demand for solar products from consumers. With the solar industry starting to gain its traction, more revenue will be generated for participants throughout the upcoming years.

External Analysis:

PESTEL Analysis:
Clean energy and the need for solar manufacturing have been on a consistent rise over the past few years due the climate crisis and the need to get away from other forms of energy that have been used in the past. The transition from energy sources and the innovative research and development in this industry has made the solar power manufacturing industry very desirable. This industry can be analyzed through using the PESTEL analysis which is utilized to assess a business’s external environment by separating the opportunities and risks..
Political – The success of solar panel manufacturing in the US is dependent on a couple different factors, the first criteria is the desire of individuals/governments to move towards cleaner energy solutions, “this strong performance can partially be attributed to the continued sentiment shift in favor of renewable energy, which will continue to accelerate given the agenda of the incoming new presidential administration in 2021” (Patel, 2022). The next criteria is competition between domestic and foreign manufacturers and regulations placed on them. Most recently, competition with major manufacturers in China has decreased overall because of the tariffs placed on them by the American administration. According to the IBISWorld report on the solar manufacturing industry, its stated that the “policies have dramatically reduced imports from China, nearly erasing the effects of underpriced Chinese solar products flooding the domestic market. Because of these policies and the necessity of companies to manufacture solar panels, the opportunity for this industry to grow is huge” (Patel, 2022). This allows for domestic companies to be able to compete amongst each other in a fair playing ground.
Economics – The solar power manufacturing industry has grown a lot in recent years and projections show that it will continue to do so over the next few years. The market is projected ”at an annualized rate of 35.9% to $3.8 billion over the five years to 2022, including a growth of 8.5% in 2022” (Patel, 2022). The demand for solar panels has risen since the government has pushed for cleaner energy sources as well as incentives for individuals who turn towards renewable energy.
Sociological – Since the United States gets most of their oil from foreign nations, if they were to move to mainly solar panels manufactured in the U.S., not only would they have less dependence on other countries for energy, but more jobs would be created in the US as well. The reliance on one source of energy can be dangerous for a country of our caliber. These jobs would be created at solar panel manufacturing companies and renewable energy companies alike.
Technological – There has been constant advancements inside the technology behind the solar panels being produced. The new silicon panels being produced are making installations easier, the panels more efficient and cost effective as well. Solar panels have started from very low wattage to being able to net over 400 watts a panel. With constant research and development from multiple companies, this industry and technology will continue to grow.
Environmental – The environmental impact of the solar panel manufacturing industry is one of the most attractive things about it. Solar panels are one of the top forms of clean energy sources. It uses natural sunlight to produce electricity without the use of fossil fuels that harm the environment.
Legal – With a more progressive view on clean energy and all things alike, the push for/back renewable energy could be the crutch for this industry. Many laws could come out in the future that allow for solar energy and other clean energy sources as the main products needed for energy. Laws like this would allow for the solar power manufacturing industry to get even larger in the future. Also laws that push for the use of fossil fuels could potentially damage this industry. With many gas companies being able to lobby people in power, it may become difficult to fully transition to clean energy sources.

Industry Problems:
Currently, one of the major problems that is associated with growth of the solar manufacturing industry is the reliance on the outlook of the other energy resources. The consumption of electrical power, coal, and fossil fuel seem to play a big factor in the demand of the solar modules. Since there is a high demand daily for these resources, higher prices will drive consumers to look for other resources. This is where the solar panel manufacturing industry can come into play and be taken advantage of. Over the past few years, the industry has been given subsidies by the government to grow this industry and bring in more consumers.

Porter’s 5 Forces Analysis:
Competition – Competition in the solar panel manufacturing industry is because all American companies have competition between each other as well as competition with forien exports. According to the IBISWorld report on the solar manufacturing industry, competition is extremely high as a result of Asian companies’ lower manufacturing costs (Patel, 2021).
Potential of New Entrants – The solar panel manufacturing industry has an extremely high barrier to entry because it requires a lot of starting capital and a need to maintain a high capital throughout the business cycle (Patel, 2021). The pressure of always needing high capital and needing a lot more than usual to begin with is very difficult for many companies and aspiring companies, so this makes the potential of new entrants very low.
Power of Suppliers – The power of the suppliers is hard to pinpoint because, according to the IBISWorld report on the solar manufacturing industry, the major players have improved their process beyond the need for suppliers, while smaller companies rely heavily on suppliers to make the solar panels (Patel, 2021). This poses an interesting situation for the suppliers of inputs for the solar panel manufacturing industry. In order to make a final decision, because it seems the industry still has a moderate dependence on suppliers, the power of suppliers is high.
Power of Customers – According to the IBISWorld report on the solar manufacturing industry, there is a high customer class concentration meaning that a lot of the solar panel industries’ customers are concentrated into a small group of people. This creates a high power of customers because it is more threatening for one customer to switch when they make up 10% or your revenue, for example.
Threat of Substitutes – Substitutes for the solar panel manufacturing industry include, but are not limited to, natural gas and crude oil. These two industries are well established and low in cost for companies to adopt. Recently this has become more apparent “the fall of natural gas and crude oil prices in the United States,” low prices for substitutes makes threat of substitutes high
(Patel, 2021).

Competitor Dynamics:
Currently, solar panel manufacturers are competing against many different variables to see who comes out on top. Whether it’s their patented technology or lower manufacturing costs, many manufacturers must determine their strategy prior to entering to stay afloat and compete in this industry. The most important variable that can be quantified and compared would be the Cost per Wattage. This amount is typically what consumers look at first when comparing photovoltaic panels against one another since it calculates the total price of a system (Brill & Pelchen, 2022). The cost per wattage is calculated by the cost of one panel divided by the amount of wattage produced per panel. Another variable that manufacturers must consider is the efficiency of their technology. This can be measured by the output of power for each module per size of the area. This is often very valuable when space is limited. It allows for more consumers to take advantage of renewable energy. Another important factor that differentiates competitors is their technology. This requires firms to hire the best individuals for their research and development team in order to keep up to date with their competition. Industry participants who adhere to these three variables have a greater chance of competing and staying in business.

Cooperative Dynamic:
First Solar as a player in renewable energy plus other participants in the industry, corporate in diverse areas. However, the fundamental area within the external macro environment is indeed in the renewables in order to reduce the carbon footprint in the atmosphere globally. Looking into different reports and studies about this company and indeed the entire industry, it is easily known that almost 91 percent of the customers here have this notion that it is critical for various companies to actively engage in pursuing sustainability efforts, and this major entails renewable energy targets (First Solar, 2021). For instance, at First Solar, the utility-oriented solar deals are regarded to be economically attractive and as a way of meeting the sustainability targets and also ensuring the reduction of exposure to energy price volatility.
Also, the company’s corporate in areas of technology which is an incentive to them toward the generation of clean electricity for the longest time, helping them to reduce carbon emissions and air pollutants. Through its partner distributors like Graybar, Kinect Solar, and indeed WESCO Distribution, the company has been able to establish high-quality, high-performance, eco-efficient photovoltaic (PV) modules . The modules are today available to the distributed generation (DG) market in the whole of the United States and also they market it through the module distribution partners named above. This has enabled it to establish innovative manufacturing processes and enable the smallest carbon footprint, lower the lifecycle of water use, and indeed facilitate energy payback time of any solar offerings on the market.
In conclusion, the company is today in support of the organization’s mission of cooperating and collaborating with other diverse members, looking deeply into the suppliers, and of course, the stakeholders within this diversity in order to promote and improve working and environmental conditions and business performance through leading standards and other best practices.

Internal Analysis:

This internal analysis is a breakdown of the company’s assets, resources, and processes to thoroughly examine the internal environment of the company. Secondary research conducted involved the company website, library databases such as Mergent Online and IBISWorld, and other key sources.
Company Mission, Visions, and Goals:
Presented on all of their reports, the company seeks to create a cleaner future for humanity through their mission statement and vision. The company states it is their goal to “create enduring value by enabling a world powered by clean, affordable solar electricity” (Corporate responsibility, n.d.). First Solar’s patented technology has the ability to displace 89-98 percent of energy produced by traditional production, and greenhouse gas emissions are reduced. This technology allows the company to align with their mission by powering the world through cleaner energy. As a current leader of the solar manufacturing industry, the company visualizes their future on top of the solar manufacturing industry and providing affordable energy solutions to their consumers.
Value Chain:
– Inbound Logistics
– Manufacturing Locations:
– Malaysia
– United States
– Vietnam
– Operations
– Expanded manufacturing from 25 megawatts (2005) to 7.9 gigawatts (2021).
– Recycle 90% of materials for reuse
– 1 kg of CdTe semiconductor can be recycled 41X, producing electricity for 1,230 years
– Converting mining by-products into the most eco-efficient PV technology
– End-to-end manufacturing in 4.5 hours vs. up to 3 days for c-Si
– 2.5X lower carbon footprint
• 3X lower water footprint
• 2X faster energy payback time than c-Si panels made in China
– All Enables faster and greater decarbonization
– Outbounds
– Uses 3rd party Distributing partners to get product shipped out
– Marketing and Sales
– Environmental company
– Work towards the background
– Biggest advertisement is that they used recycled products which is eco-friendly and cost efficient
– Human Resource Management
– SCREENING
– All suppliers go through hard qualification process
– CONTRACTUAL AGREEMENT
– Contracts set out to prevent unethical/moral work and labor rights
– AUDIT
– Audit to make sure that everything is being set into place within the above co ntractual agreement
– TRAINING
– Employee development
– REPORTING

Strategic Business Units (SBU):

(“First Solar, Inc.”, 2021)
– Currently, they offer 3 different styles of PV modules on their website
– Series 6
– Series 6 Plus
– Series 6 CuRe
– As their technology advances, they move on to selling their newer products and only advertise those products on their website (like how Apple works)
– Offers a recycling service for PV modules
– Recovers up to 90% of the materials recycled
– Offers contacts to different vendors for components needed to get their solar panel running such as mounting/racking hardware, wires, and inverters. Clients do not have to search for parts that work with the panels they sell. This creates ease for clients who are not sure which products are compatible with the solar panel.
The company is well diversified. They manufacture their own panels as well as work on commissioning projects for their clients. The company has
– Different Modules and Technology (products offered)
– Series 6
– Series 6 Cue
– Recycling
– Manufacturing Plants
– Solar Farms/Engineering, Procurement and Construction (EPC)
– Technology (Research and Development)/Developers

Critical Value-Creating Activities:
First solar uses multiple materials in order to manufacture solar panels.
● They take steel and iron and turn it into frames for the panels
● They take plastic and resin and turn it into panes to protect the interior
● They take semiconductor chips and turn them into circuit boards to convert the sunlight into energy.

Global Expansion:
First Solar has expanded its footprint to various global locations such as Malaysia, Vietnam, Mexico, Brazil, Belgium, Germany, Singapore, Japan, and India. Last year, the company received financial Helpance from the U.S International Development Finance Corporation for their expansion into Tamil Nadu, India (Woo & Dvorak, 2021). This expansion includes a 3.3 GW solar manufacturing facility that is expected to be completed by 2024. The company can cut manufacturing costs down tremendously by moving their production overseas. This project will also boast their global manufacturing capacity to 16 GWs of power (Woo & Dvorak, 2021) and allow their company’s presence established in the foreign country. The firm is seeking to expand globally as much as possible with many turning to cleaner energy sources. The goal overall seems to be to intertwine with countries who are relatively new to this technology. With their advanced thin film technology, solar energy can be generated almost anywhere and bring power to the people.

Corporate Structure – First Solar Executive Officers:

(FSLR | First Solar Inc.. company profile & executives – WSJ)

First Solar’s corporate structure consists of multiple individuals leading certain sectors that the company works with. It is built similar to other corporate structures where a specific hierarchy is formed to ensure accountability within the firm. The current head of the company, or also known as the Cheif Executive Officer (CEO) of the company, is Mark R. Widmar. Widmar has been involved with First Solar Inc. since 2011 where he served as the company’s Chief Financial Officer (CFO). As he progressed through the company, he moved up to his current position as the CEO in 2016. Alex Bradley, over took that role and is the current CFO for First Solar. He has been involved with the company since 2016. His role consists of creating contracts and financing the company’s growth expansion. Overall, the company has seven total executives that lead different divisions within the company and with different responsibilities.

Company Website Overview:
At a quick glance, First Solar’s company website is laid out very professionally and modernized. It is pleasing to the eye and very easy to navigate. There is a lot of information that investors and consumers can obtain when they browse the website such as their annual reports, financial statements, current board of directors, the investor overview, and many more. The website is broken down into many different sections such as product offerings, services offered, company overview, and their careers page. Due to how the website looks and performs, the company seems to have their priorities aligned.

Career Offerings:
Throughout the research portion, the career opportunities offered on the company’s website offered jobs such as Development Engineering Technician II, Software Engineer II- in the Manufacturing Systems, Engineer-Manufacturing in USA, Manufacturing Engineer II Process Perrysburg, OH, Research, Logistics, and Manufacturing Financial Management. Many of the jobs primarily offered are in the field of engineering or information technology. Most of the engineers working for this company are mechanical engineers, and they are undertaking the works of research, design, developing, manufacturing, test tools, engines, machines and indeed mechanical devices. This industry requires a lot of engineers that are passionate and innovate in order to keep up with the market

Annual Report Analysis:
The analysis of First Solar’s 2021 annual report begins with their mission statement “to create enduring value by enabling a world powered by clean, affordable solar electricity” (Annual Report 2021, n.d.). This statement can be seen across their website and through their company reports. This ties into their business strategy and competitive advantage as they are showcasing their differentiating features through their resources and technology. They are rich with resources, as they have proprietary IP, processes and R&D, and assets making them stronger than their US and international competition. With their innovative technology, the company can differentiate itself from the major competitors in this market.

The annual report concluded that the company generally prices and sells their solar modules on a per watt basis. As of December 31, 2021, they had entered into multiple contracts with customers for the future sale of 21.9 GWDC of solar modules for an aggregate transaction price of $5.9 billion, which the company can expect to recognize as revenue through 2025 as they transfer control of the modules to the customers. Through these contracts, the company can expand its market share by partnering with different companies that will utilize their products. The report also goes over the company’s financial performance for the year and the projections for the next few years. This includes their goals and objectives that the company plans to tackle within the next upcoming years to further expand their business.

The report goes over some of the company’s business model which involves selling products in the United States domestic market, which makes up roughly 83% of First Solar’s revenue and the remaining 17% comes from First Solar’s international markets (Annual Report 2021, n.d.). Current their international market makes up of East Asians countries, Japan in particular, and certain European countries, those being Germany, France and the United Kingdom. As the company continues to expand globally, the company foresees a rise in demand for their solar panels. CEO Mark Widmar states that “there is a tremendous amount of demand right now, across all segments of the market” (Roselund, 2017). These expansions have allowed for the company to grow into markets that have not been tapped in yet by panel manufacturers. This allows the company to grow and build a relationship with consumers.

Recent News from Company:
Aside from a slight drop in First Solar’s stock price, the company is investing about $680 million to expand their Perrysberg, Ohio location (Davis, 2021). This expansion will create 500 temporary jobs to build it and later 700 full time jobs to operate it the facility. The expansion point to the fact that the company is continuing to grow and seeking to expand their infrastructure. Another headline that surrounds First Solar is their partnership with SB Energy and Leeward Renewable Energy. The partnership with SB energy will “bring 1.3GW of new solar projects to commercial operations in 2021, making [it] the second largest in terms of new solar capacity added to the grid” (Business Wire, 2021). Their newest agreement with Leeward Renewable Energys comes on April 25, 2022. They will be supplying the company with 1 gigawatt of their manufactured thin filmed panels. These contracts tend to be the main revenue sources for the company. Each contract could range from hundreds of thousands to millions per project. First Solar is continuing to develop advanced climate technology and infrastructure alternatives for the renewable energy sector.

Stakeholders:
Data reported on the CNN Business, shows that the top give owners of the company are BlackRock Fund, The Vanguard Group, Wellington, Invesco Capital, and SSgA Funds (Cable News Network, n.d.). These owners are all mutual funds. Since mutual funds are make up of many different investors, the company has millions of different investors that have pooled their money to purchase such equity.

Keep satisfied and meets their needs

EMPLOYEES Key player, manage closely

CUSTOMERS
Monitor, Minimum effort, least important Keep informed, show consideration

STAKEHOLDERS AND INVESTORS
After conducting the stakeholder analysis (Figure 1.1) on First Solar’s, it is determined that employees, customers, and investors are critical to the company’s success. These stakeholders are the people that are primarily interested and involved directly with the company. Through this analysis, it was determined that the most important stakeholders are as follows, customers, investors, and employees. Customers are the most important stakeholders as without the demand for their products and services, the company will not be able to stay afloat. The company can keep these stakeholders involved by sharing news for new products and offer a high level of customer service. Employees would come second as they are the backbone of the company. These stakeholders are the ones keeping the organization running smoothly. They are in charge of creating new products and providing services to the customers. It’s best to keep these players involved and attended to. The last but not least importance is the investors. Investors are backers of the company in a financial sense. These stakeholders contributed to the company through their investments in hope that the company will do well in the future. These investors should be kept informed because they make financial decisions based on the performance of the company. First Solar has released annual reports and earning presentations quarterly to show the company performance.

Industry Impact:
There has been a source of competition in solar panel manufacturing between China and the United States. China is much more advanced in the industry in revenues than the U.S. The reason that China has such an advantage is that they are lavished with government subsidies (Wildmar, 2021). Although one would think that this is a regular thing for a country to do. This is unlawful and goes against the World Trade Organization regulations. The threat of new entrants is that chinese companies have been getting the best bargain because of the funding that they have from the government.

The three powers of suppliers are; Recycling, Glass Manufacturers and Customers. The majority of the company’s products are recycled goods. Since we are dealing with solar panels they still use glass products so this is where the glass manufacturers come into play. If the price or the cost of these recycled products begin to go up then the price of these solar panels will go up as well. The last driver being the actual customers. Customers as we know are what makes the actual business. In this specific industry customers can have an effect by a few factors. They could not be a full believer of the solar panels and could stick to what is familiar with them with original electricity sources. Which is essentially a higher cost energy source. This is why solar panels would be a much better option. The industry just needs to be more accessible and have more research and development.

First Solar is expected to have a higher competitive position in the solar panel manufacturing industry compared to their competitors. The company has captured a majority of the market for years as well as establishing their brand and name for consumers. They differentiated themselves with their technology. The bargaining power of suppliers and customers is expected to stay the same because the industry seems to use the same suppliers for all of the raw materials. Many manufacturers are using the same core materials to produce their panels. The threat of substitute products for First Solar is expected to decrease, so First Solar will have a higher competitive position. More competitors are turning towards a different technology. Their patented technology plans to use thin film to generate power compared to glass structured panels from their competitors. Finally the rivalry among existing competitors is expected to fall. First Solar is continuing to grow and capture more of the market share domestically and abroad. This leads to smaller competitors having to exit the market or get acquired by someone else.

Financial Performance Analysis (Gross Marins and Current Ratio):
Gross Margins (Gross margin ratio = Gross profit / Net sales)
● 2021 – $729,954,000/$2,900,000,000 = 0.252%
● 2020 – $680,673,000/$2,711,332,000 = 0.251%
● 2019 – $549,212,000/$3,063,117,000 = 0.179%
● 2018 – $392,177,000/$2,244,044,000 = 0.175%

The company’s history shows that the margins are steadily growing year by year. They are continuing to generate positive profit and showing that they can sustain themselves throughout the years. First Solar is moving a good path where the company can forecast greater profits to their shareholders and stakeholders. This ensures to the investor that the company still has room for growth and can stay afloat in this industry. This may bring in more investors due to the projected growth of the company. It also shows that the company is very stable as they have been in business for decades and still remain the as one of the top major players in the industry.

Current Ratio (Current ratio = Current assets / Current liabilities)
● 2021 – $2,649,587,000/$726,878,000 = 3.65
● 2020 – $2,402,285,000/$847,398,000 = 2.83

The company has the ability to pay off roughly 3 times its current liabilities. The company is in a good position if an unexpected occurrence were to happen. Although it can be said that due to a high ratio, the company is not putting its money to productive use. The company can use this extra cash to further their R&D or buy newer equipment to speed up production. The company can also do a few other things such as paying dividends to their loyal shareholders or even acquiring competing firms.

Non-financial Performance Analysis:
After checking multiple online sources containing information about employee satisfaction and customer satisfaction I found this information:
Customer satisfaction: First Solar has an overall Customer Service score of 3.4 out of 5 stars rated by its users and customers. (Although selling straight to the population isn’t one of their major sources of income)
First Solar is also known for having some of the best quality solar panels, which is a large player in why they are used in such large clean energy projects.
Employee Satisfaction: First Solar ranks in the Top 10% of other companies on Comparably with 5,001-10,000 Employees for Overall Company Culture Score.
First solar is seen as one of the top companies to work for inside of the Solar manufacturing sector. Employees are shown to be happier here then other companies including areas such as happiness, management, CEO approval, and ability to retain their employees.
In all non-financial areas First Solar Excels. This alongside their ability to have great success in financials as well is what has propelled them to the top in their field.

Capabilities and Core Competencies:
Porter’s value chain analysis is extremely known in the world of business. It must be upon First Solar not to take it as a rigid, isolated model by assigning equal significance to all activities (Strevel et al., 2012). For this company, the effective value chain analysis needs the realization of the company’s activities or functions that do not demand a similar investigation. For this reason, the very initial stage for adapting this value chain model is by identification of the significance of the entire activities with regards to their role in product/service delivery processes.

For instance, the major capability areas of First Solar include but are not limited to the fact that the company is not having its projects placed on the balance sheet, or dealing with uncertainties like those of changing interest rates, and this can eventually turn a profitable project into a money loser overnight. With regards to the core competencies the company is holding, it can be noted that its brand propelled by strengths in manufacturing with its highly loyalty programs has powered its growth and performance in green energy (Strevel et al., 2012). Like any other green energy company in the industry, one fundamental rigidity for it is price. From the theoretical perspective regarding the macroeconomic impacts of price rigidity to this company is that the changes in prices which are timed optimally by the company in response to macroeconomic shocks like the COVID-19 pandemic always lead to radical adjustment of the aggregate price level than do price changes which are timed randomly (Strevel et al., 2012). To deal with this issue, the company will have to scrutinize its price variations overtime and create somewhat qualitative data which is accurate and informative about their aggregate variables as far as the macroeconomic view is concerned.

Strategies:
First Solar’s business strategy revolves around the use of their advanced technology, their manufacturing process, research and development and sustainability broken down in their 2021 Annual Report (Annual Report 2021, n.d.). Their patented technology uses thin-film polycrystalline with a CdTe which differentiates themselves from their competitors. This material provides better results for power generation in partially shaded areas, higher temperatures, and immune to cell damage (Annual Report 2021, n.d.). This will allow for consumers to net better results in power generation compared to standard solar panels offered by their competitors.

First Solar’s manufacturing process has been one of their most successful strategies implemented. With over 40GW of solar panels sold globally, the company has forumated the process to manufacture each panel to under couple of hours (Annual Report 2021, n.d.). They have removed several steps that are typically taken by other manufacturers which often take several days to complete and across different facilities. This will allow them to keep up with the demand and create more solar panels worldwide.

Research and development is one of the most important business strategy that solar manufacturers have to implement into their firm. With technology advances occurring rapidly, the firm has to keep up with the industry players to stay relevant and remain competitive. First Solar’s strategy is to focus primarily on their wattage per panel and energy efficiency of the module. This includes working with third party laboratories to develop a cell that is more productive and efficient. The company is constantly seeking ways to improve their product development, research, manufacturing processes and applications of their technology (Annual Report 2021, n.d.).

First Solar’s sustainability goals consist of two different factors. The firm wants to limit their carbon footprint throughout their manufacturing process as well as their solar module’s life cycle. The company offers a recycling program that seeks to recycle over 90% of the glass and semiconductor components of the modules in their new panels (Annual Report 2021, n.d.). This program seeks to lower their carbon footprint by 2.5 times when compared to their competitors. They also strategized their manufacturing process to lower their consumption of energy, water, and semiconduct materials throughout. The company has committed to transitioning their energy consumption at manufacturing plants to 100% renewable energy by 2028 (Annual Report 2021, n.d.).

Corporate Governance:
A company’s or organization’s bylaws establish the structure, responsibilities, and powers granted to its board of directors. Rules are then established by the board determining the number of board members, how they are chosen, and how often the board meets. First Solar’s board of directors consist of many different executives and members that were elected to serve as representatives of the company’s shareholders. The board members are made up of some of the internal executives as well as other firm executives. The company’s board has four different committee charters that certain board members are appointed to with each having one chair member. The committees consist of the auditing, compensation, nominating and governance and technology committees.

The auditing committee makes up of six members with Sharon Allen being the chair (“Leadship”, 2021). Allen has been the director of the audit committee since 2011 (Dow Jones & Company, n.d.) for First Solar. She is a very decorated executive as she was the first woman in history to be elected as an independent chairman of an organization (Importer, 2017). She also serves on the board for companies such as Bank of America, Albertsons, and Harvard University (Dow Jones & Company, n.d.).

The compensation committee is made up of five different executives with Michael Sweeney serving as the chairman (“Leadship”, 2021). Sweeney is also a member of the Nominating and Governance committee. Sweeney’s background is in corporate finance and operation management where he served as the president of the world famous coffee shop Starbucks in London (Michael T. Sweeney – Director Corporate Governance & Nominating,Audit,Compensation., n.d.). He has served on multiple boards throughout his career. Although his tenue on First Solar’s board has been since 2003.

The nominating and governance committee has five members serving as well. This committee is headed by Paul H. Stebbins (“Leadship”, 2021). Stebbins serves as a member for two other committees such as the audit and compensation committee. His career background is primarily working alongside energy source companies. Since 1995, he has been the director for World Fuel Services Corporation, a energy solutions company (Paul H. Stebbins Director Corporate Governance & Nominating,Audit,Compensation, n.d.). His tenure on the First Solar board has been since 2006.

The last committee, technology, with five members is headed by George Hambro (“Leadship”, 2021). Hambro has worked in various positions for First Solar from 2001-2009. His background includes engineering and development for companies such as the Goodrich Aerospacec and Staq Energy (George A. Hambro – Director Technology, n.d.) . He has served as the chairman of technology since 2012.

Competitive Map:

(Results based on Figure 1.4)

The competitor map or also known as the competitive strategy analysis of a company, is a graphic representation for analyzing a company’s rivals. First Solar’s top competitors in the solar industry have been analyzed throughout Figure 1.4. The major competitors are as listed below.

● Canadian Solar, a well known solar equipment manufacturer based out of Canada, offering a variety of solar products for commercial and residential consumers (CSI Solar, n.d.).
● Yingli Solar, one of the world’s largest solar panel manufacturers based out of China, has panels across the globe shipping to over 100 countries (About yingli, n.d.)
● Tesla, the popular electric automotive company who just recently stepped into the solar industry. The company acquired Solar City in 2016 which allowed them to create their Tesla Solar line of products (Garfield, 2016) and offer solar panels to consumers.
● Life’s Good (LG), the electronic company based out of Seoul, Korea. The company offers a variety of products ranging from home entertainment, appliances, and even solar modules (Solar: Business, n.d.).

The criteria used for market commonality was based on a few key factors. The first and foremost was the production of solar panels. Each of these companies must produce or have their own solar panels. The second criterion was battery storage. The company must produce a battery storage system for their solar panels. The last criterion was solar farms. Solar farms are large scaled plants with many photovoltaic (PV) panels, often known as solar panels, or alternative solar energy collecting technologies, such as concentrating solar systems, to capture the sun’s energy. This type of solar generation is very different from the normal rooftop solar (picture shown below).

(What is a solar farm, 2021)

Diagnostics:

Implementation:
First Solar has many noble core values that have propelled them into the top player in the solar panel manufacturing industry. They strive to be the top supplier of sustainable energy and lead the world in innovation for the industry. They are trying to be a clean company that provides clean energy. For the implementation chart there were a few parts that did not align with their core values, so they were given a lower A score. These categories included Corporate Governance, Organizational Structure, and Rewards. The reason these were given lower scores is because they were categories that did not relate to their core values. First Solar’s core values have to do more with technology and environmental stability, but these categories are related to the corporation itself. The categories that were scored an 8 were Strategies and Performance, these were scored this way because they aligned with some of the company’s core values but not all of them.

SWOT:
Weaknesses relation to opportunities and threats: First Solar’s weaknesses are that they have low profit margins and very high competition. These are able to connect to their opportunities and threats as well in multiple different ways. First Solar’s low profit margins for example are heavily connected to their threat of not having the ability to secure resources in a timely and cost efficient manner. Because they have such high cost drivers with resourcing materials, they end up getting lower profit margins as a result. Low profit margins can also be connected to the constant shift to newer technology in the market. Money is constantly having to be spent on research and development in order to stay one step ahead of the competition and unfortunately their profit margins will tend to take a hit because of it. Next is their weakness of having very high competition, this weakness can be connected to opportunities. With the public’s view on the market as a whole becoming very positive, it is natural for there to end up being many competitors trying to get into the market as well since it can look very attractive. The connection to this weakness and the opportunity for first solar is with mergers or acquisitions, with this many competitors in the market and First Solar being one of the largest players in the market they have the ability to acquire some of the more threatening competitors in their market giving them an even larger competitive advantage.

Strengths relation to opportunities and threats: The biggest strengths of First Solar is there ability to consistently grow revenue. This essentially is the biggest advantage a company can have. With consistent generated revenue brings the means for endless opportunities because you have the finances and the will power to do so. The companies other strength is that they’re very R&D focused. Being that this industry is changing by the day with it being how new it is, it would be a necessity to focus on R&D to stay ahead of this industry to eliminate that threat. With there R&D and revenue comes opportunities to expand on there products like battery storage. This would essentially differentiate themselves from competitors on the products that they offer which the company already does well. Although the company is able to always generate revenue and has captured the largest market share in the solar industry, they still oppose the threat of the depending on the pricing of resources and natural materials. If these prices change then essentially the entire company outlook would change too.

Alternatives:
As we know, the company as a whole is doing very well in the industry. As in fact they’re one of the industry’s top leaders. With that being said there is always room for improvement and how you operate as a company.

First Solar doesn’t have their own direct source of distribution. In order to purchase one of their solar panels you’d have to go through a third party distributor to get your hands on one. This essentially takes away the power that the company can have to do a few things that could go wrong with this. The third party distributor can increase their pricing or distribution fees. This can potentially move them away from their mission to become an affordable clean energy provider. Also since it’s not a direct source of distribution, the company doesn’t know how effective their product is being distributed nor do they have control over that. Creating a first party distributor would essentially give the company their own power in how they would want to distribute their products. This leaves the power

The company’s top competitors for First Solar are Canadian Solar and Yingli Solar. Although unlikely, any opportunity the company finds that can lead to a potential buyout of one of these companies could be very beneficial for the company’s growth within the industry. Buying out one of these companies could cost financially. One would have to make sure that buying out one of those companies would be beneficial strategically, before making that move financially.

As of current date Solar is one the highest sources of energy if not the highest source. In contradiction to that, there are other energy sources that could easily come back and be the main source of energy again putting solar companies like First Solar out of business. There is still yet to be the main solar panel that the world looks to as the solar panel that would revolutionize the industry of energy as a whole.

Recommendations:
For the growth and development within the organization and various areas of operations of the company, the company ought to implement strategic marketing plans and approaches that are set to elevate sustainable growth and regulate importation in the country and thus encourage the citizens to adopt the use of solar. The company management should then adopt a multifaceted approach towards dealing with production and marketing, for instance, bringing players like the government and allies to forge for sustainable energy productions (Alsharif et al., 2020). This can be done through regulations in areas of tariffs on the imports relating to energy from outside countries like China to encourage a transition from the use of fossil fuels to use of renewable sources of energy. Such a policy will allow opportunities in the renewable energy sector and spur growth with the organization’s domestic and infant renewable industries to attract a huge market .For example, the American administration placed high tariffs to china imports and this decreased imports in the country.

Implementation of solar companies and formation of new resolution markets projecting to the interior and rural areas setting incentives to use renewable and cleaner energy. This increases the level of dependence of a country as it can sustain itself without depending on imported fuel. Solar panels have started from a very low wattage to being able to newt over 400 watts a panel (Vinoth Kanna & Pink, 2020). Solar energy is environmentally friendly as it is clean .It uses direct sunlight to produce electricity. Legal laws should be imposed to allow only the use of clean energy as fossil fuels and many gas companies lobbying damage the solar company.
In entrepreneurial practices of solar energy, there should be an increase in company formation and no change in interest rates through training in loyalty programs. Solar companies should focus on price variations of their products and analysis the performance .use of technology to increase the market of solar energy in the country through the global market, analyze the chain of supply in the market levels, and how to reach the new market as to increase sales of panels (Irfan et al., 2019). Increasing creativity and new inventions and innovations on solar panels that produce more energy and better models and designing of solar panels to increase the trapping of sunlight which increases electricity production .In conclusion, the executive and board of directors should set up a new solution to adopt the use of renewable solar energy.

In addition, there is a need for the company to expansively engage in the integrating “smart grid” technologies into the electrical grid which will make its overall operation more flexible and efficient. That will allow greater use of renewables (Irfan et al., 2019). For example, smart meters can incorporate prices that change based on demand for electricity, allowing utilities to better estimate electricity demand and production. Smart grid technologies also include monitoring and controls that can help to better manage electricity sources and storage technologies. For instance, Transmitting more electricity through solar systems and renewable sources like wind power—and doing it efficiently—will be key to overcoming this barrier and helping renewables achieve wider use (Irfan et al., 2019). New technologies, such as high voltage direct current and the use of superconducting materials, are improving the efficiency of transmission. However, policy and siting issues for new transmission lines remain barriers to many new transmission projects.

References:
About Us. CSI Solar – Global. (n.d.). Retrieved April 18, 2022, from https://www.csisolar.com/aboutus/
About yingli. About Yingli Solar | Yingli Solar. (n.d.). Retrieved April 28, 2022, from http://www.yinglisolar.com/us/about
Annual Report 2021. (n.d.). First Solar . Retrieved March 3, 2022, from https://s2.q4cdn.com/646275317/files/doc_financials/2021/ar/First-Solar-Annual-Report-2021-Web-version-(final-from-Merrill).pdf.
Brill, R., & Pelchen, L. (2022, April 19). How much do solar panels cost? Forbes. Retrieved
Cable News Network. (n.d.). FSLR. CNNMoney. Retrieved April 28, 2022, from
https://money.cnn.com/quote/shareholders/shareholders.html?symb=FSLR&subView=institutional
Climate Finance Partnership – Institutional. BlackRock. (n.d.). Retrieved March 14, 2022, from https://www.blackrock.com/institutions/en-us/strategies/alternatives/real-assets/infrastructure/climate-finance-partnership
Davis, B. (2021, Jun 10). First solar to build new solar-panel factory in ohio; U.S. company is banking on growing demand for solar power and government support for alternative energy. Wall Street Journal (Online) Retrieved from https://ezproxy.csusm.edu/login?auth=shibboleth&url=https://www.proquest.com/newspapers/first-solar-build-new-panel-factory-ohio-u-s/docview/2539374836/se-2?accountid=10363
Dow Jones & Company. (n.d.). FSLR | First Solar Inc.. company profile & executives – WSJ. The Wall Street Journal. Retrieved April 26, 2022, from https://www.wsj.com/market-data/quotes/FSLR/company-people
First Solar, Inc. (2021). (). Fort Mill: Mergent. Retrieved from Business Market Research Collection Retrieved from https://ezproxy.csusm.edu/login?auth=shibboleth&url=https://www.proquest.com/reports/first-solar-inc/docview/1860767504/se-2?accountid=10363
First Solar Inc (NMS: FSLR), (n.d.) Retrieved from the California State Univeristy of, San Marcos, University Library Web site: https://www-mergentonline-com.ezproxy.csusm.edu/companydetail.php?compnumber=116048
Garfield, L. (2016, September 12). Everything you need to know about the solar company Tesla wants to buy for $2.6 billion. Business Insider. Retrieved April 28, 2022, from https://www.businessinsider.com/solarcity-tesla-solar-energy-2016-9
George A. Hambro – Director Technology. (n.d.). San Marcos. Retrieved April 12, 2022, from https://www-mergentonline-com.ezproxy.csusm.edu/companyexecutives.php?compnumber=116048&execid=7515754&win=profile&pagetype=directors.
Gupta, U. (2021, December 9). US Bank to lend $500 million for First Solar’s 3 GW fab in India. pv magazine International. Retrieved March 20, 2022, from https://www.pv-magazine.com/2021/12/09/us-bank-to-lend-500-million-for-first-solars-3-gw-fab-in-india/
Importer. (2017, August 3). Sharon L. Allen. U.S. Chamber of Commerce Foundation. Retrieved April 30, 2022, from https://www.uschamberfoundation.org/sharon-l-allen
Leadership. First Solar. (2021). Retrieved March 12, 2022, from https://www.firstsolar.com/About-Us/Leadership
Michael T. Sweeney – Director Corporate Governance & Nominating,Audit,Compensation. (n.d.). San Marcos. Retrieved April 28, 2022, from https://www-mergentonline-com.ezproxy.csusm.edu/companyexecutives.php?compnumber=116048&execid=5393253&win=profile&pagetype=directors.
Patel, K. (2022, January). Solar Panel Manufacturing in the US: US Industry Report 33441C.
Paul H. Stebbins Director Corporate Governance & Nominating,Audit,Compensation. (n.d.). San Marcos. Retrieved April 12, 2022, from https://www-mergentonline-com.ezproxy.csusm.edu/companyexecutives.php?compnumber=116048&execid=582510&win=profile&pagetype=directors.
Political activity statement. First Solar. (n.d.). Retrieved March 14, 2022, from https://www.firstsolar.com/en/About-Us/Political-Activity-Statement
Roselund, C. (2017, July 27). First solar to re-start Vietnam factory for its series 6. pv magazine USA. Retrieved April 26, 2022, from https://pv-magazine-usa.com/2017/07/27/first-solar-to-re-start-vietnam-factory-for-its-series-6/
Solar: Business. LG Global. (n.d.). Retrieved April 10, 2022, from https://www.lg.com/global/business/solar
Strevel, N., Trippel, L., Kotarba, C., & Kahn, I. (2013, December 18). Improvements in
CdTe module reliability and long-term degradation through advances in construction and device innovation. Photovoltaics International. PVTech. Retrieved February 2022, from https://www.irishellas.com/files/PVI_22_First_Solar_Reliability_WhitePaper_lowres.pdf.
Strevel, N., Trippel, L., & Gloeckler, M. (2012). Performance characterization and superior energy yield of First Solar PV power plants in high-temperature conditions. Photovoltaics international, 17(3), 7.
What is a solar farm? Renewable Energy World. (2021, September 2). Retrieved March 22, 2022, from https://www.renewableenergyworld.com/storage/what-is-a-solar-farm/
Woo, S., & Dvorak, P. (2021, Dec 08). Business news: U.S. agency boosts india solar-panel project. Wall Street Journal Retrieved from https://ezproxy.csusm.edu/login?auth=shibboleth&url=https://www.proquest.com/newspapers/business-news-u-s-agency-boosts-india-solar-panel/docview/2607516463/se-2?accountid=10363
Alsharif, M. H., Yahya, K., & Geem, Z. W. (2020). Strategic market growth and policy recommendations for sustainable solar energy deployment in South Korea. Journal of Electrical Engineering & Technology, 15(2), 803-815.
Irfan, M., Zhao, Z. Y., Ahmad, M., & Mukeshimana, M. C. (2019). Solar energy development in Pakistan: Barriers and policy recommendations. Sustainability, 11(4), 1206.
Vinoth Kanna, I., & Pinky, D. (2020). Solar research–a review and recommendations for the most important supplier of energy for the earth with solar systems. International Journal of Ambient Energy, 41(8), 962-968.
First Solar Inc (NMS: FSLR), (n.d.) Retrieved from the California State Univeristy of, San Marcos, University Library Web site: https://www-mergentonline-com.ezproxy.csusm.edu/companydetail.php?compnumber=116048
Industry Analysis – Solar Panel. Retrieved from the California State Univeristy of, San Marcos, University Library Web site: https://mergent-firstresearch-learn-com.ezproxy.csusm.edu/industry.aspx?chapter=0&pid=411
Solar, F. (n.d.). Sustainability report 2021 – First solar. Retrieved May 1, 2022, from https://firstsolar.com/-/media/First-Solar/Sustainability-Documents/FirstSolar_Sustainability-Report_2020.ashx

Appendix:
Figure 1.1: Stakeholder Analysis:
Stakeholder Name Impact
1/2/3 Supportive
-1/0/1 Influence
1/2/3
Customers 3 1 3
Shareholders and Investors 2 0 3
Employees 1 1 2

Stakeholder Name Importance Contribution Power
Customers Stakeholders are interested in, “Meetings, Seminars & Conferences, Technical Workshops, Product Presentations” (First Solar Sustainability Report Pg 61)
The customers of this project are the biggest contributors, if the customers are loyal then First Solar will always have success with their mission Customers hold a lot of power as well if they don’t want to do business with First Solar, then they will not be able to have any success
Shareholders and Investors Stakeholders are interested in, “Meetings, Earnings Calls, Analyst Days, NSF 457 standard development” (First Solar Sustainability Report pg 61)
Any decisions that may need to be made in the future regarding First Solars clean energy mission They have the power to potentially veto or block any future mission that First Solar may want to pursue.
Employees Stakeholders are interested in, “Circular Economy, Community Impact, Energy & Emissions, Environmental compliance
& eco-efficiency, Labor practices, Talent attraction & retention and Training & education.”(First Solar Sustainability report Pg 61) Innovation in regard to clean energy and any projects that First solar wants to pursue. They have the power to allow first solar be able to have success or not in any future First Solar projects through R&D

Stakeholder Name Strategy for Engaging Stakeholder
Customers/Technical Advisors “Engage through Meetings, Seminars & Conferences, Technical Workshops, Product Presentations on a daily basis” (First Solar sustainability report pg 61)
Shareholders and Investors “Engage through Meetings, Earnings Calls, Analyst Days, NSF 457 standard development on a quarterly/annually, ongoing basis” (First Solar sustainability report pg 61)
Employees “Engage through Training Sessions, Meetings, Newsletters, Surveys, Global Webcasts, Sustainability Ambassador program on an ongoing basis” (First Solar sustainability report pg 61)

Figure 1.2: SWOT Analysis:

Strengths:
● Ability to consistently grow revenue
● Heavily focused on their R&D and training and development of their employees
● Differentiates themselves from competitors on their product offerings
● Largest producer semiconductor cell solar
● Captured the largest market share in solar manufacturing Weaknesses:
● Low profit margins
● Very high competition
Opportunities:
● Global expansion to growing solar markets
● Society’s outlook on the solar market/industry
● Expand their product offerings such as battery storage
● Acquire or merge with a potential competitor Threats:
● Ability to secure resources in a timely and cost efficient manner
● Market is constantly shifting with newer technology
● Rules and regulations
● Dependent on pricing of resources/materials

Figure 1.3: Implementation Analysis:
Company name First Solar A Score
Core Values ● Make clean energy affordable
● Provide clean energy around the world
● Lead the world in sustainable energy
● Drive innovation in the renewable energy sector
10
Mission/Vision/Strategic Intent ● Provide lower pricing over competitors
● Have First Solar products across the globe to progressing countries
10
Capabilities
Core competency/ies ● Lower prices
● Not having its projects placed on the balance sheet
10
Strategy ● Technology Efficiency
○ Output of power per cell of the panel
○ Ultra-low Carbon Thin Film Technology
● Cost per wattage advantage
8
Structure ● High on Business ethics
○ “Speak up, ask questions, and report any concerns”
○ Protect employee privacy
○ Protecting community
■ Following environmental policies and procedures

8
Corporate governance ● Board of directors
○ Chooses CEO
■ Companies responsibilities are delegated to this position
○ Number of members should not exceed the necessary number needed to operate.

6
Organizational culture ● Agility – Creative and resilient
● Collaboration – Help each other succeed
● Accountability – Own results of our actions
6
Performance, controls ● Financial stability
● Enhance profitability 8
Rewards ● Pay-for-Performance
● Global Grading system for clear job pathways
● Four week paid parental leave
6
Figure 1.4: Competitor Map:
Market Panels Battery Storage Solar Farms Sum
First Solar X X 2
Tesla X X 1
Canadian X X X 2
Yingli X 1
LG X X 1

Resource Silicon Glass Requires Distributor Sum
First Solar X X 2
Tesla X X 1
Canadian X X X 2
Yingli X X X 2
LG X X 1
Figure 1.5: Board of Directors

(Leadership, 2021)
Figure 1.6: Top Owners of FSLR

(Cable News Network, n.d.)

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