Here we review the current status of Selco. Harish and his company have completed 80,000 installations with plenty of room for growth. They have 25 service centers, and just over 140 employees.
SM: What stage are you at now? How many installations have you done, how many employees do you have, what is the level of profitability, and what kind of geographical coverage are you accomplishing? HH: As of today, I have reached a revenue base of approximately $4 million. I have 80,000 housing installations, most of them are in individual households in the state of Karnataka which has population of 44 million and approximately 8 to 10 million households.
We have 25 centers, and we aim to have all of these centers profitable. We have 142 employees, 20 in the head office and the rest in the centers. We believe that sustainable energies are only sustainable if we have door step service and door step financing. That is why we created 25 centers, and their location is based on the distance a technician can travel on a motorbike in two hours. That is the service area.
Each center needs to be a profit center. We set targets in two ways. If a particular center’s break even point is $10,000 per month, we set $10,000 with a minimum of 20 houses. They cannot go to a hospital and get a $10,000 sale and meet the goal. The households are the sustainability of Selco for the future. Those 20 houses will lead to 200 houses in the next 5 years.
SM: Do you serve hospitals and public buildings? HH: We do hospitals, temples, churches, mosques, residential orphanages.
SM: The 80,000 installations you have today are covering about 800,000 people? HH: I would say 500,000.
SM: What is your profitability? HH: Last year was 3.5% – 4%. This year was a massive loss.
SM: What are your growth goals and your target? HH: The plan is to reach an additional 200,000 households by 2011 with multiple energy services. We hope to have 65% of revenues coming from solar energies, and the rest coming from better methodologies of cooking, drying and bio gas.