Q1: What could be the reasons for the unfavorable evaluation of PV

technologies by Greg Morgan?

a) The bid prices of the competitor’s products especially BJ Solar’s were
significantly lower than PVT’s. Even Morgan was surprised of the spread
being so wide.
b) Solenergy was considering a focus on expense control, so a significant
difference in price was a real concern.
c) Solenergy is planning to compensate inferior performance factors
coupled with a proactive quality control program
d) The enhanced oversight and expanded maintenance schedule would
raise operating cost, the lower net ownership costs argued in favor of
selecting the lowest cost product

Q2: Evaluate alternative course of action available to PVT to gain

favorable evaluation by Solenergy for the Barstow Project?

Alternate 1 : Extended Warranty

Advantage of First Option:
a) Net Profit remains same as per current bid: USD 7,12,8000
b) Good sign of quality product
c) Confidence on Reliability of products
On other side:
a) A bit expensive as project of Sales is almost 4 million extra.
b) Customer may perceive that Warranty does not always mean
good quality product
Alternate 2 : 99% up time Guarantee
a) Offer cannot be match by competitors.
b) Offer will establish PVT as leader in high quality products.
c) Signal of high reliability.
On the other side :
a) Very costly and a very high impact on the profit.
b) Chance that every customer will start demanding of the same
c) High impact on cost while the coming time is indicating the
preference of low cost solutions.
Alternate 3 : Introduce an upcoming product with higher technology
a) Higher capacity at 1.25 MW and 98.5% efficiency at the price of
1.00MW
b) Most efficient and reliable inverter in the market.
On the other side: Extremely risky as it is new product and preponing of
launching by squeezing pre testing time is not favoured by their own
team.
Alternate 4 : Starting discussion with Morgan
As the information that PVT is losing the deal can be rumours,
therefore in that case approaching Morgan for discussion can put
PVT in a bad light of desperation and also getting the confidential
information from alternate channels can further put their credibility
down.

Q : 3 What short term and long term policies and processes should PVT
develop and implement to effectively improve its marketing programs?
In this case it looks like there is a failure at relationship level by Salvatory,
as he has to get this information much in advance that Solenergy is
considering the cost cutting through some internal initiatives. If this
information is passed to the bidding team in advance then this situation
will not arise. The following actions can be considered to avoid such
situations
a) More focused on relationship management & communication on
products with our long term customers
b) Regular training for sales professionals that can market/ update the
new & upcoming offerings. In this case the customer would have
informed the upcoming product i.e. 1.23 MW invertor even before
the RFP was floated.
c) In long term company must spend more money for Low cost/Cost
effective technologies to bring down their product prices.