Small Business Story: Aikyum Solar Faces Business Interruption, Loss of Key Man, & Other Risks

The CoverWallet Small Business Scholarship encourages entrepreneurship in students by asking them to take on the perspective of a local small business owner. Students share their perspective on the opportunities and challenges faced by a business in their community.

Student: Kate Harker, California Polytechnic State University, San Luis Obispo

Small Business: Aikyum Solar

Aikyum_Solar Business

Due to their friendly customer service and environmentally-friendly services, my favorite small business is Aikyum Solar. They face the risks of losing a key employee, experiencing a natural disaster, changes in laws favoring solar panels, and increased material costs.

Only two full-time employees work at Aikyum: the owner and the project manager. About five part-time employees do desk work, and about 12 others install the solar panels themselves. If the project manager left, died, or got sick, the owner would have to search for another employee and train them until they could do their job as well as the original person. Training them could take months, because they’d have to learn all the specific procedures to follow in the solar panel industry. This would cost the owner thousands of dollars. Also, because installations can’t be done without the project manager, Aikyum would have to stall them until the new employee was trained. Customers might turn to other companies because they got tired of the delay, so Aikyum would lose business.

A natural disaster like a hurricane or tornado would hurt Aikyum because installing the solar panels is done outdoors. Conditions too dangerous for employees to work outdoors would also cause Aikyum to need to stall installations.

One of the current reasons to install solar is the 30% Income Tax Credit (ITC) offered by the federal government. Aikyum partially depends on the ITC to attract new customers. Former President Obama’s administration started the ITC to encourage the use of clean, sustainable energy. However, President Trump’s administration values saving the environment less than Obama’s did, leading to the risk of them removing the ITC. Aikyum can’t control whether or not Trump keeps the program; corporations with millions of dollar can donate money to politicians to influence their decisions, but Aikyum doesn’t have the money to spare to do that. All Aikyum can do is hope Trump sees the value of solar panels in reducing carbon dioxide emissions.

Furthermore, Aikyum purchases SMA inverters, the solar panels themselves, and other supplies from manufacturers before installing them on homes and stores. If the prices of manufactured solar panels increased due to shortages of natural resources, international economic sanctions, or other causes, Aikyum would have to charge customers higher prices. That would lower the demand for Aikyum’s solar installations.

When the risks Aikyum faces are considered, it’s impressive the owner is brave enough to continue running her business. It seems likely she’d want to play it safe so she definitely won’t lose money. However, she perseveres due to her passion for engineering. I commend her for her confidence and self-discipline as she leads Aikyum.