Selling solar appliances on credit
SunTransfer sells solar home systems for off-grid households in Kenya, using a PAYG rent-to-own model.
From its thirteen solar centres, the company distributes solar home systems and TVs as packaged kits, which are offered on a cash basis or on credit with a 15-18 month re-payment model. It also offers free installation, an after-sales service and a warranty.
Between 2015 and 2017, we helped SunTransfer refine its business strategy and positioning after a period of non-performance. Our advisory team conducted a thorough analysis of the profitability of each of its solar centers, as well as developed a tool to analyse the risks of borrowing money in local currencies and in USD's. This allowed them to create a sustainable economic business model.
We also advised them to focus on providing high quality appliances and removing some parts of the product package. This has enabled them to reposition. themselves as a premium brand. They can now continue to provide energy access to rural communities and give their customers more options by allowing them to customise their packages and, in turn, buy extra appliances.