First Solar Summary Q2

Yes, they are sustainable. A company achieves sustainable competitive advantage when the
large number of consumers that prefer their product over the offerings from other competitors.
First Solar was consistently more profitable than SunPower, Suntech and Yingli from 2007 to
2011 even though there had been financial crises in 2008 to 2009 when the government
withdrew the subsidies. The importance of capabilities in building the sustaining competitive
advantage via creating valuable capabilities such as cannot be easily bested, matched, or
imitated by rivals and represent superior know-how and specialized abilities that require time to
fully develop. First Solar proves that they have capabilities in the sustainable competitive
advantage when they can value their product, have an inimitable, rare company compared to
other competitors and they have a strong organization.

Firstly, First Solar knows how to value their own product. First Solar has a strong brand
image with the high integrity brand company and the high integrity of the management
leadership. They produce the modal based on customer demand through uniqueness of the
size and area with the high quality and reasonable price. Other than that, First Solar also has a
strong management leadership that can comply with the rule and regulation to sustain the
environment. The United States government also gives them support to increase the
renewable energy in the utility market by providing them incentive and subsidies.

Secondly, First Solar has its own strengths that are difficult to imitate by its competitors.
When a financial crisis happens, First Solar still can survive in this industry because they have
lowest cost production of the manufacture via changing their materials to the thin-film cadmium
telluride technology that is able to reduce a few supply chains and high cost batch processing
step compared to crystal silicon panels. Next is First Solar able to offer a high quality product
with reasonable price compared to SunPower, Suntech and Yingli. With the high quality with
reasonable price that First Solar offers, their net sales have increased around $2 Million Dollar
from 2007 to 2013 and that proves that their company can achieve sustainable competitive
advantage.

Thirdly, First Solar was a rare company compared to other companies. They are risk
takers that are willing to take a high risk to join ventures in the market system whereas they
knew that they had a very large gap with SunPower , the system leaders. First Solar gained the
sustainable competitive advantage because of this action. First Solar is also a dynamic
capability in overcoming the challenges that different countries face based on demand, need
and difference managerial function of the consumer. Therefore, they are capable of achieving
the sustainable competitive advantage because they have differentiation strategies focused on
outperforming competitors in a narrow market by offering consumer customization attributes.

Lastly, First Solar has a strong organization that is their strength. They use a different
financial strategy that can attract the investor to invest in their company because they borrow
less and have a lower average annual debt compared with their competitor. Therefore, the
company can sustain in the long term. Next is their investment and continuous in Research and
Development in solar energy the consumer needs and wants. Hence, it helps First Solar to
achieve the sustainable competitive advantage.