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From 2007-2011, First Solar was consistently more profitable than its major competitors: SunPower, Suntech, and Yingli....

  1. From 2007-2011, First Solar was consistently more profitable than its major competitors: SunPower, Suntech, and Yingli. What are the sources of First Solar’s competitive advantage? Are they sustainable? Quantify where you can.
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From 2007-2011, First Solar was consistently more profitable than its major competitors: SunPower, Suntech, and Yingli. Following are the sources of First Solar’s competitive advantage as below

  • Lower production cost: This is the most significant factor that help the First Solar to gain the competitive advantage in solar industries. This helps to manage lower cost and improves the profit for the business.
  • Major customers in Germany and US: The success of First Solar was to gain major customers in Germany and US, which ensured the supply to continue.
  • Long Term supply Contract: The long term contract for supply is the major break through this company get and developed the competitive edge in the market.
  • Strong Rivalry Benefit: The rivalry benefits are strong for this company and this created the competitive image in the market.
  • Demand management flexible production setup: It has flexible set up which is suitable for increase demand management and .production. This helps in managing the cost and achieves customer satisfaction.
  • Good cash Balance: This helps for better investment for future readiness for the business.

No, they are not sustainable and going forward the future for First Solar will be very challenging. These key factors that have created the competitive edge are not going to sustain and the company needs to find the sustainable improvements that can last longer.

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