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ZanneNx
04-11-2010, 02:24 PM
You can skip down to the main question if you do not feel like reading all of this :)

Hello everyone,
I'm currently an engineering student taking a entrepreneurial class and we have to prepare a business plan. I chose to do one on for a LED landscape lighting company since I have interested in starting one myself. I just found this site today so I haven't looked around too much yet, but I definitely plan on spending a lot of time here reading as much as I can.

Here is a little backround on me:
I am currently a materials/mechanical engineering sophomore student. I have experience working a LED lighting company Lamina Lighting(now Lighting Science Group) where I learned too much to list. I have also conducted research on developing high CRI, low CTT quantum dots for use with LEDs while at school. On the side I sell loose LEDs such as Cree, Seoul Semiconductor, and Luxeon LEDs. I am well versed in CAD softwares such as Pro/E, NX6, Catia, Solidworks and have machining experience and knowledge. I feel that the only aspects I am missing in designing my own landscaping lights to sell to a market would be designing the driver, optical system, and aesthetic design. I also have experience retro fitting some of the landscaping lights at my house with LED.

My vision for the company:
Well first and foremost, I would like the absolute best in quality. If it isn't not as bright or brighter than what it will be replacing then I will not sell it. They will be built to last and have a warranty to back it up. Each design will forgo months of testing and abuse before and after releasing it to the market to find any faults. I will display direct side by side (both in the same picture) comparison with similar incandescent or cheap LED fixture from other companies. The importance of picking the desired color temperature and CRI for the application will be explained and recommendations given. Even with all of this, I think my prices can still be competitive with the LED lights already on the market. I have many innovative ideas in my mind I think this market may like.

My main question:
Is there any interest in a company like I am describing? What do you look for in choosing LED landscaping lights and/or landscaping lights in general? Are there any faults with me or my idea of the landscape light company I would like to start? I am very open to constructive criticism so please don't hold anything back! :)

Thanks!
Zanne
:waving:

irrig8r
04-11-2010, 06:01 PM
You should talk to Sherman Gingerella at dglights.com.

He has had some success with the same concept. I bet he could fill you in some on the kinds of stumbling blocks you might encounter.

I tried to get my youngest son (who is about to graduate in Industrial Technology from Cal Poly SLO) interested in the same field, but he already has a good job lined up with an international manufacturer of things like industrial lasers and microscopes, and isn't ready to be an entrepreneur right now.

David Gretzmier
04-12-2010, 12:34 AM
You've got a few hurdles.

First off, I think you mean "undergo" months of testing rather than forgo months of testing. forgo would mean "you would not do" or "skip" testing.

you are going up against american and chinese companies that have already been testing and retesting various led's, drivers and heatsinks. many have invested hundreds of thousands of dollars, maybe millions, trying to perfect and duplicate the warm white light of halogen. they have been dealing with the enclosed fixture issue on heat buildup destroying drivers and frying led's.

I could go on and on. established dealer network, manufacturing, UL listing, distributors, name brand recognition, etc.

but let's say you can overcome all the expense and hurdles and bring a viable product to market. In order for folks to buy, you have either got to have such a superior product over whatever else is out there, or it has to be as good and signifigantly cheaper. you would be asking folks to take a risk to trust your company.

And with led's, many folks like myself don't even trust the reputable companies right now. because we have tested one, a few, dozens or tons of led products and been disappointed to the power of 10.

there are a few out there that look good, but you cannot get them in 10 degree through 60 degree in 10-15 degree increments. If you cannot control beam spread, then you cannot do your job. and you cannot know how long they will last in Canada winter or arizona summer.

finally, be honest with yourself how large the market is for such a product. I have invented and developed a few Christmas light products that are far better than what is out there, but what will it make me? tens, maybe a hundred g's per year profit?

If I was going to invest my time and money, and I was your age in engineering school ( like I was back in '89-91- go CSEG'ers), I would look at developing led bulbs for the home and landscape lighting. the market is way bigger. . .

ask yourself why The sylvania LED mr-16 at Lowes for 30 bucks uses 8 watts to develop 220 lumens, when a r5 bin warm white cree xpg should do that at 2 watts easy. Why can you buy the most advanced LED on the market that does 320 lumens in a 20 buck flashlight on ebay that has 5 modes and is sealed and waterproof?

The newest xpg's coming in the pipeline are doing 186 lumens per watt at 350ma. who will be the person to put that led on a heatsink with a 8v-18v driver, and with inexpensive interchangable reflectors ( they have them for flashlights everywhere) that run from 5 degrees to 60 degrees?

no one has that right now, yet the technology is right there in the flashlight industry. make it work, long lasting, and folks will buy.

INTEGRA Bespoke Lighting
04-12-2010, 11:50 PM
David, no personal offense intended, but your lack of knowledge and understanding of HB LEDs for general illumination applications and SSL in general is ... well.... it is huge.

The advice to pursue better LED lamps is sound, as that is where the bulk of the market is and will continue to be for a very long time.

Zanne, when it comes to your dreams, don't give up. That being said, to develop the business model you are envisioning will require boatloads of capital.

Regards.

David Gretzmier
04-13-2010, 12:22 AM
James, no offense taken. my knowledge on Led's comes from the flashlight and Christmas light biz. but I have asked you in other forums, and you have knowledge in this field, and you never responded. How can warm white led's be making over a hundred lumens per watt around 300ma or so on the flashlight side, on heatsinks, in enclosed waterproof fixtures, and have been doing so for well over 2 years, really since the p4 and up bin range of the older XRE cree's, yet most mr-16's out there making 220-260 lumens are at roughly half or less that efficiency. you can talk about driver efficiency if you like, most of the ones for flashlights, be they buck or boost, are running 80-90%. PWM drivers do a bit better with more range.

are the chips used today just really old luxeons, rebel 80's, or older SSC's that are used with inefficent drivers?

ZanneNx
04-13-2010, 01:20 AM
You've got a few hurdles.

First off, I think you mean "undergo" months of testing rather than forgo months of testing. forgo would mean "you would not do" or "skip" testing.

:o Thanks for catching that, I did mean undergo..


you are going up against american and chinese companies that have already been testing and retesting various led's, drivers and heatsinks. many have invested hundreds of thousands of dollars, maybe millions, trying to perfect and duplicate the warm white light of halogen. they have been dealing with the enclosed fixture issue on heat buildup destroying drivers and frying led's.

It seems like most main LED companies are/were focusing on getting the highest efficiency mainly using a cool-white blend of phosphors.. Only now are more companies starting to care about warm white, high cri, and strict binning procedures. I plan on making the LED fixture itself so there will be no issues with

I could go on and on. established dealer network, manufacturing, UL listing, distributors, name brand recognition, etc.

I have a few connections for manufacturing, but I would have to start from the ground up with establishing a dealer network, distributors, and all..

but let's say you can overcome all the expense and hurdles and bring a viable product to market. In order for folks to buy, you have either got to have such a superior product over whatever else is out there, or it has to be as good and signifigantly cheaper. you would be asking folks to take a risk to trust your company.

And with led's, many folks like myself don't even trust the reputable companies right now. because we have tested one, a few, dozens or tons of led products and been disappointed to the power of 10.

Well my plan is to make a superior product. I will have a range of color temperatures to choose from as well as high CRI (color rendering index) LEDs for applications that need them. I think the hardest part would be gaining consumer confidence. I would like to do that by having pictures of direct comparisons with traditional incandescent light sources. Maybe even offer samples.

there are a few out there that look good, but you cannot get them in 10 degree through 60 degree in 10-15 degree increments. If you cannot control beam spread, then you cannot do your job. and you cannot know how long they will last in Canada winter or arizona summer.

I don't think it would be too hard to implement easy to change optics.. Optic manufacturers like Ledil have lenses and reflectors that give different angles but are sized identically. I think I could make it be as easy as screwing in a light bulb..

finally, be honest with yourself how large the market is for such a product. I have invented and developed a few Christmas light products that are far better than what is out there, but what will it make me? tens, maybe a hundred g's per year profit?

I am very curious about the market size. I am trying to read up as much as I can to get a good estimate and go for there. This is more for a class than an actual business but if the business plan ends up being good I wouldn't mind giving it a shot..

If I was going to invest my time and money, and I was your age in engineering school ( like I was back in '89-91- go CSEG'ers), I would look at developing led bulbs for the home and landscape lighting. the market is way bigger. . .

The reason I don't want to develop the LED bulbs is due to what you stated before. The enclosed fixtures and space confinements would greatly restrict the quality and brightness of the LEDs and final product. You can see that in the market today. By making the fixture LED specific, the housing can be used as a heat sink. This allows the use of brighter and more powerful LEDs to help match the performance of the lights that will be replaced.

ask yourself why The sylvania LED mr-16 at Lowes for 30 bucks uses 8 watts to develop 220 lumens, when a r5 bin warm white cree xpg should do that at 2 watts easy. Why can you buy the most advanced LED on the market that does 320 lumens in a 20 buck flashlight on ebay that has 5 modes and is sealed and waterproof?

The newest xpg's coming in the pipeline are doing 186 lumens per watt at 350ma. who will be the person to put that led on a heatsink with a 8v-18v driver, and with inexpensive interchangable reflectors ( they have them for flashlights everywhere) that run from 5 degrees to 60 degrees?

no one has that right now, yet the technology is right there in the flashlight industry. make it work, long lasting, and folks will buy.

I assume you are talking about this LED? http://www.sylvaniaonlinestore.com/p-106-ultra-mr16.aspx

That's actually a Lamina Lighting MR16 which I assume was licensed to Sylvania. The LED used in that is from like 2006 and a lot of advancements have been made since then.. If you would like, I can get really technical as to why this lamp in particular cannot be upgraded easily to brighter/more efficient LEDs.. I asked the same question while I was there..

Another thing is most of those high efficiency LEDs are cool-white.. Neutral and warm white phosphors are not as efficient. But from what I've noticed in real life, the less efficient neutral and warm white LEDs can look just as bright as the cool white in household use. And as far as I know, Cree hasn't released any R5 warm-white XP-G's.. They closest they have is R4 neutral white that is publicly available. But you probably already know how fast Cree releases new and more effecient LEDs.. Even today they released a new one.. The XM which does 160lm/w at 1 watt.. http://www.cree.com/press/press_detail.asp?i=1271079100891

Thanks a lot for your response :)
Zanne

ZanneNx
04-13-2010, 01:44 AM
James, no offense taken. my knowledge on Led's comes from the flashlight and Christmas light biz. but I have asked you in other forums, and you have knowledge in this field, and you never responded. How can warm white led's be making over a hundred lumens per watt around 300ma or so on the flashlight side, on heatsinks, in enclosed waterproof fixtures, and have been doing so for well over 2 years, really since the p4 and up bin range of the older XRE cree's, yet most mr-16's out there making 220-260 lumens are at roughly half or less that efficiency. you can talk about driver efficiency if you like, most of the ones for flashlights, be they buck or boost, are running 80-90%. PWM drivers do a bit better with more range.

are the chips used today just really old luxeons, rebel 80's, or older SSC's that are used with inefficent drivers?

Well I think one HUGE difference is the flashlights are using the manufacturer's ratings. Lets take a Cree R2 bin for example. Cree claims it puts out between 114-122 lm at 1 watt. If I remember correctly, when Cree and other manufacturers do this measurement, it is only when the LED is in a controlled environment at 25*C. As you may know, the brightness of the LED decreases with heat which is why thermal management is so important.

Now in flashlights using the R2 bin, they are advertised as outputting the 122 lm like Cree says the LED would output. What they do not do is take into account the loss in lumen due to thermal and optical properties. Lets say the reflector used is 80% efficient, the glass lens is 98% efficient, the body of the flashlight is at 35*C and due to the thermal resistance the die temp of the LED is at 60*C (~7% loss according to the datasheet). Now adding all of this up 122 - 8.5 (thermal loss) - 22.7 (reflector loss) - 1.8 (glass lens loss) = 89 lumen out of the flashlight..

What I witnessed at Lamina was completely different. When testing the brightness, the lamps were left on until they reached their operating temperature before measuring. This resulted in a real world lumen value that the customer purchasing the lamp will receive with no marketing gimmicks..

Of course this is only part of the reason why. The choice of LED used is another big thing..

Feel free to correct me if I am wrong somewhere :)
Zanne

steveparrott
04-13-2010, 11:04 AM
:It seems like most main LED companies are/were focusing on getting the highest efficiency mainly using a cool-white blend of phosphors.. Only now are more companies starting to care about warm white, high cri, and strict binning procedures.
Color temp is really critical. Warmer temps are widely recognized as preferrable for residential use. In fact, new Energy Star guidelines for LED's requires warm whites.

:I have a few connections for manufacturing, but I would have to start from the ground up with establishing a dealer network, distributors, and all.
Don't underestimate the difficulty with this task. Forget the big box stores - if you ever get in them, they will squeeze out nearly all profit, and may endanger your business by their unpredicatable purchasing methods. That leaves you with distributors and mfg. reps. You need sales and support people to nurture and capture these organizations. Even if you do get into distribution, you need to have quality people to work the market - quality people are expensive and putting them on the road, even more so. Also, don't neglect the cost of maintaining inventory - this requires big up-front investment in materials and an ongoing outlay of money that precedes predicted sales.

:Well my plan is to make a superior product. I will have a range of color temperatures to choose from as well as high CRI (color rendering index) LEDs for applications that need them. I think the hardest part would be gaining consumer confidence. I would like to do that by having pictures of direct comparisons with traditional incandescent light sources. Maybe even offer samples..
It's great to make superior products - you should. Just recognize that the market for the most superior (most expensive) products is a small fraction of the total LED market and you'll be competing with well-established big companies that have far more resources than yourself. That only succeeds if you capture a niche market, one that the big guys overlook. Maybe focus on one very distinctive product. OLED's are very interesting in that regard - very different from incandescent, huge potential for creative applications.

Regarding the building of consumer confidence. That's already happenning. In a very short time consumers will already have accepted that LED's are equal to or better than incandescent. Unfortunately, they will put a lot of downward pressure on pricing and expect to pay what they paid for incandescents. If you want to sway consumer opinion you'll have to show them that your product is superior and worth the money, you'll need to leverage the technology to create something that incandescents can't offer.
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:I am very curious about the market size. I am trying to read up as much as I can to get a good estimate and go for there. This is more for a class than an actual business but if the business plan ends up being good I wouldn't mind giving it a shot.

Market size numbers are fairly easy to get for the overall lighting market or for some large segments, such as residential vs. commercial. But those numbers wouldn't help you to monetize your particular niche market (whatever that may be). That will take some digging and guessing.

:The reason I don't want to develop the LED bulbs is due to what you stated before. The enclosed fixtures and space confinements would greatly restrict the quality and brightness of the LEDs and final product. You can see that in the market today. By making the fixture LED specific, the housing can be used as a heat sink. This allows the use of brighter and more powerful LEDs to help match the performance of the lights that will be replaced.
The jury is still out on whether or not HB LED's can be developed enough to make them interchangeable and replaceable (and not bound to a fixture). If the heat limitations are overcome, then the fixture-bound LED will be dead in the water. The technology isn't there yet, and may never be, but if your business plan requires a big investment and a long start-up time. . .

David Gretzmier
04-13-2010, 11:16 PM
Thanks for all the responses ! I agree the cool white LED's do tend to have more lumens per watt that the 3000k warm white ones. I believe cree has an r5 bin xpg that is 3000k temp, and I thought it was already out there at 107 lumens per watt at 350ma.

Thanks for the new link. 160 lumens per watt and lower temps even at 110 lumens per watt at 2 amps !