Tuesday, December 1, 2015

Green Continuing to Shape the Future of New Home Building

Despite the headwinds created by growing concerns about the cost of building green, a high percentage of home builders and remodelers are already building green and expect to do so in the future. While home builders and remodelers report that consumers of all ages are interested in green, the study also finds that consumers age 55 and older are the most important group driving the current green market. The findings also demonstrate that consumers' association of green with healthier homes leads to even higher potential for growth in the future, as do increased use of renewable technologies by 2018.

The 2015 Dodge Data & Analytics study, which surveyed 232 builders and remodelers from across the U.S., demonstrates that they recognize the benefits of green building:

  • Over half (54%) of home builders are currently constructing at least 16% of their new homes green, and 39% of remodelers report that at least 16% of their remodeling projects are green.

  • By 2020, nearly all (81%) home builders will be constructing that level of green, with over half (51%) building at least 60% of their new homes green.

  • By 2020, remodelers report a similar level of growth, with nearly three quarters (74%) making at least 16% of their projects green, and over one third (36%) completing over 60% of their projects green.

These expectations of higher green involvement emerge despite growing concerns about the cost of building green. 77% of home builders and remodelers report that building green has an incremental cost over traditional construction of 5% or more, notably higher than the 60% in 2014 and 58% in 2011 who noted that level of increased cost. While higher cost is also the top obstacle to green reported, it does not appear to have dampened the drive toward green in the market.

One key factor driving the growth of green is the association of green homes with healthier living. Home builders and remodelers certainly recognize the potential: most (83%) believe that consumers will pay more for homes that are healthier.

Another factor leading to growth in the residential market is the increasing use of renewable energy. The study demonstrates that the use of renewable technologies is expected to grow across the board, revealing an interest in energy performance that goes beyond green. By 2018, nearly half of home builders and remodelers expect to be using solar photovoltaic (48%) and ground source heat pump (52%) technologies. Net zero homes are also emerging as an important trend, with nearly one quarter (21%) of home builders having built a net zero home in the last two years.

One interesting finding of the new study is that the greatest impetus for green homes comes, not from millennials as many people might expect, but from consumers age 55 and older. Data from the study suggest that greater familiarity with home features leads to an emphasis on home performance. Therefore, as the environmentally-minded millennials gain more experience with homeownership, it is quite possible that there could be even greater demand for green in the future.

Monday, November 30, 2015

East Coast Modular Home Factory Needs Sales Personnel

A large East Coast modular home factory has asked me to help them find a new Sales Manager and another Sales Rep.

If you think you have what it takes to move into either of these positions for a large and fast paced company, please send your resume to Modcoach and I will forward them directly to the President of the company.

Sunday, November 29, 2015

RAD Technology Builds for Ultimate Niche Market

In the fight against cancer, getting the right treatment matters.  With the selection of Design-Builder RAD Technology Medical Systems (RAD), Banner MD Anderson Cancer Center in Gilbert, AZ has expanded its radiation oncology program, bringing new treatment expertise to patients at Banner Boswell Medical Center in Sun City, AZ under a greatly accelerated schedule.  

Banner MD Anderson relied on RAD's team of innovators, problem solvers and seasoned medical industry veterans who have worked on cancer care facilities for many years and have developed the unique skill set needed to be an industry leader in the cancer facility market.

The program integrates radiation cancer treatment at all three locations with Banner MD Anderson, including MD Anderson Cancer Center's world-renowned approach to cancer care and access to subspecialty experts in both Gilbert and Houston. Radiation oncology patients will also have access to many of the programs and services offered at the comprehensive cancer center in Gilbert. Eileen Reagan, service director for oncology at Banner Boswell Medical Center mentioned, "We're able to reach farther into the Northwest Valley.  We're very excited."

The facts about the new cancer center delineate exactly how unique RAD's patented modular building solution is. The new facility is 5,214 total square feet and it can be relocated, expanded, or left permanently.

The building modules arrived on May 11, 2015 and Banner took occupancy on June 29th and the accelerator installation began. Therefore, the entire facility was assembled and made ready in 49 days. The facility consists of 16 separate building modules and parts of the facility were fabricated in Quebec, Indiana, and Arizona.

The therapy room is surrounded by over two million pounds of mass to shield the patients, public, and clinicians.  The shielding is designed to protect radiation energy levels at 180 times that of a normal diagnostic x-ray.  The building includes shielded spaces for a linear accelerator and a CT SIM. 

"Offsite or factory modular construction has many advantages over conventional methods," stated RAD President, John Lefkus.  "These advantages are most obvious in healthcare facilities where access to the latest cancer treatments can have a profound effect.  Once complete, evidence of factory construction does not exist.

Friday, November 27, 2015

Industry Round Table Could Change Everything

Prior to 2008 the modular housing industry experienced continuous growth, but after the housing recession many factories succumbed to lesser growth to the point of going out of business or actually ended up closing their doors forever.

Next week a group of the top executives from major East Coast modular home factories will meet for a Round table to discuss the problems currently facing our industry, the overall stagnation of modular housing today and what can be done to once again become a leader in single family home building.

When this Round table happens, there are five key areas that should examined to identify what's going on.

1. A Lack of Information

Problem: If we don't understand exactly what our builders want and work to fulfill those needs, our industry’s growth can stall. Do we really know what's working in our industry right now and what isn't? When is the last time a factory had a conversation with their builders to find out what they're doing right and what needs the builders are having met by competitors?

Solution: First, we should form two focus groups. One should be made up of current builders who do steady business with our industry, and the other should include builders who do not currently buy modular homes or have tried one or two and decided against it. Ask questions to determine why those who buy do, and why the other group does not. Next, use the information you glean from the focus groups to create a survey for all of your current and past builders. Ask them specific questions about what we’re doing right, what we could improve on, and how. Once we have this important information, we need to tweak our industry’s image and procedures to reflect what our builders want.

2. A Lack of Management Skills

Problem: Some modular factory owners never let go of the startup mindset that they have to do everything themselves, and they never delegate work to others or hire additional help. As a factory grows, it requires different skill sets that the owner and top management may not have. Modular factories  require management that can aptly lead their staff to success. Many owners and top management people are very good at what they do but tend to be deer caught in headlights when it comes other areas, such as finance, marketing, website creation and maintenance, social media, builder acquisition and training. If your business has stalled, take a look at your business operations. These are not only problems for each individual factory, they are problems shared by our industry in general.

Solution: If you need people with a specific skill set, but aren't quite ready to hire permanent help, consider using independent contractors or outsourcing certain business functions.

3. A Lack of Capital

Problem: It takes cash to grow a business, and if profits aren't sufficient to fund that growth, modular home factories won't be able to take advantage of opportunities as they arise. This can negatively impact business in many ways, such as the inability to hire new staff to support growth, buy materials for large projects, or not having the capital to expand.

Solution: First, you'll need to understand how much capital you need to support growth. Forecast your income, expenses, and cash flow needs by creating realistic financial projections. Then decide the best way to find the funds, whether it’s from private accounts, a bank loan or line of credit or invoice factoring. When a large project crosses the desk of the top decision maker at the factory, make sure that it is vetted completely. Leave no stone unturned.

4. A Lack of Planning

Problem: If the modular housing industry doesn't have a clear picture of where we want to go, we'll have a difficult time getting there. A true understanding of where our business falls in the marketplace is crucial to growth because without it, we can't set realistic short-term, mid-term, and long-term goals.

Solution: To get a true picture of where our industry currently is, we need to develop a SWOT analysis (strengths, weaknesses, opportunities, and threats). Once we have an accurate picture of where we are, we can begin to develop a plan that will put modular housing back on a growth path. This needs to be done both at the factory level and at the industry level.

5. A Lack of Training

Problem: Our builders are an important part of our success, but if they aren't properly trained, they could be holding us back. For example, they might not be giving their customers the level of service they want, or your salespeople may not be equipped to bring in the amount of business you expect. We need to provide them with the tools and training they need to be the best.

Solution: With the diminishing sales of single family modular homes, many factories do not have the time, talent or financial resources to implement the training necessary to rebuild our market share. We need a collective effort by not only the factories but also the builders, set crews and vendors to really begin to bring back single family modular housing. There also needs to be one point of light that will lead begin to put together this huge undertaking. Be it the MHBA or the result of the next week’s Round table, something has to happen sooner rather than later as there just may not be any later.

There are still a couple of seats available for the Dec 3rd Round table in Lewisburg, PA and if you are a factory owner or member of top management that hasn’t already signed up for this event, please email me for more info or to register for it.

Monday, November 23, 2015

Blue Ridge Log Cabins Honored at BSC Showcase

Campobello, NC based log home manufacturer, Blue Ridge Log Cabins, received two national home building accolades as part of the 2016 Jerry Rouleau Awards for Excellence in Marketing and Home Design presented by the National Association of Home Builders (NAHB) Building Systems Councils (BSC) and the Log and Timber Homes Council. Blue Ridge Log Cabins was honored on Nov. 6, 2015, during the BSC's Building Systems Showcase, the only national conference and educational event focused exclusively on the systems-built industry.

For more than a decade, the BSC's awards program has promoted excellence in systems-built housing. Front runners in the industry are honored at the annual awards presentation for their innovative marketing strategies and unique systems-built housing designs.

The annual Jerry Rouleau Awards for Excellence are judged by an independent panel of industry experts, and companies like Blue Ridge Log Cabins were praised for the quality of their submittals. Recipients were recognized for excellence in achievement in a range of categories such as informative and aesthetically-pleasing websites, along with floor plan designs categorized by systems-built type and square footage.

"Obviously, it is nice to be recognized on the national level with two such prestigious awards. Blue Ridge Log Cabins is proud of its many talented and dedicated employees who are always working together to create new trendsetting designs and products. These accolades are definitely a testimonial to the hard work and ingenuity we have in all departments at BRLC," said Chip Smith, Blue Ridge Log Cabins' President and CEO.

Two years ago I wrote an article about Blue Ridge Log Cabins' secret marketing strategist, Sarah Smith.

Time for a Reality Check for Modular Housing

The past couple of years has seen quite a lot of activity in the world of modular housing with the biggest being the drop in percentage of new single family home construction built by our industry.

Coupled along with that are factories that are either idled or producing less than what they need to be profitable. Many factories have turned their attention to multifamily or commercial modular buildings to make up for the loss of single family home production.

On December 3rd, a large group of factory owners and top management from all over the East Coast will meet for a Round Table in Lewisburg, PA to discuss the current state of our industry and begin planning what steps should be taken by our industry in general to reverse the downward trend and work to improve homebuyers’ perception of modular housing.

NOTE: For more information about this meeting or would like to attend, just EMAIL ME.

Since nobody really has the official crystal ball for modular housing’s future, here are some observations, both good and bad, based on what has happened to our industry since the housing recession of 2008.

Hurricanes, Fires, Floods and other natural disasters:
One of the biggest shots in the arm that ever happened for the East Coast modular industry was a thing called Superstorm Sandy was rocked the Atlantic Ocean coast from NC to MA destroying hundred of thousands of homes.

This one act of Nature brought thousands of new customers to buy modular homes. Some factories were working at full capacity in the beginning of the rebuild but now that has slowed because the low hanging fruit is disappearing, tougher building codes were enacted and local code enforcement officials not familiar modular construction chose to give modular builders a tough time.

The rebuilding of homes after Sandy will really begin to slow down over the next 18 months. This will force many factories to look for business to replace the homes they have been sending to the coastal states.

Waiting for the next natural to boost business is not a business strategy. Preparing to be the leader in helping folks when the next disaster hits is a good business strategy however.

The Aging of the Modular Home Builder:
Yes Virginia, there are some young builders going into the modular home business but for every one that is entering our industry two or three are retiring, giving up or simply passing away.

There is no concerted effort by the modular housing industry to entice and train ‘new to modular’ home builders’ to join modular housing.

Every modular home factory seems to have the same track record. For every 5 new builders they bring on board, 2-3 of them build only one modular home and 1-2 of them build a couple homes before they go back to site building and are never heard from again.

At best, only 20% of ‘new’ modular home builders stay with factory housing after 18 months and that 20% is drawn from a continually shrinking pool of available new home site builders.

There is talk about revitalizing some training programs that used to be available for modular home builders and set crews and that should be one of the topics discussed at the Dec 3rd meeting.

Bippity, Boppity, Boo:
It’s understandable that every modular home factory has embraced social media. There are two main reasons for doing it.

First, it’s FREE! and secondly, it’s FREE!

I have ‘Liked’ just about every modular home factory’s Facebook page and one thing I have observed is the lack of content by most of you. When the factory first puts up their Facebook page there is something published almost every day. After the first week the number of articles and posts drops to 2 or 3 a week. Then you might see something new once a week or even once a month if you’re lucky.

Some factories tried writing a blog and attaching it to their website. Again, a couple of them post an article or two a month but for the rest of you, that part of your marketing program dries up like a prune. No posts on your blog month after month means nobody will look at it again...ever!

There used to be a lot of videos on YouTube about modular home production and the beautiful homes produced by the factories and finished by the builder but now all you find when you search for “modular homes” are a lot of video advertisements for manufactured homes and used homes.

Several factories hired people to promote their homes on social media and a couple of others assigned staff to write posts but again, after the first couple of weeks everything reverted back to the same old thing of fewer and fewer posts.

Some social media people bought “Likes” through Facebook bringing the total to several thousand. The problem with buying Likes is these people don’t buy your homes. Most of them can’t afford to buy a new home or don’t live in you service area or in the US for that matter.

There is no magic spell you can cast to make social media work for your factory. You have to treat it as a fully funded department that has goals to meet. Short of that, forget it.

Fewer to choose from:
Every month we hear about this factory being sold, this one closing, another changing from single family to commercial and others being shuttered until next year’s building cycle.

Modular home builders have to be asking themselves what happens to them if their factory experiences one of these situations. Builder loyalty will be put to the test unlike any time in the past.

Several factories are stepping up their involvement with their builders, working with them on all phases of the building process from lead generation to design through production and service after the sale. They are staying strong and their business is actually growing.

For those factories that are conducting business the same way they did before the housing recession I have only one piece of advice. Look hard at your competition and if one of them is taking market share, especially yours, emulate what they are doing. Everyone likes to follow a winner, especially your builders.

Consolidate Your Efforts:
As I mentioned earlier, there is a Factory Only Round Table for owners and top management on Dec 3rd in Lewisburg, PA.

Modcoach will be hosting it along with the MHBA’s Tom Hardiman. EMAIL ME to learn more.

Tom will be leading this Round Table and together we can finally begin to reverse what has seen our industry go from 5% of all new single family homes to 3% just a couple of years ago to our present 1.5% share.

Don’t sit on the sidelines simply cheering on the home team. You are the home team and it’s about time we all realized it.

Friday, November 20, 2015

Is Tedd Benson’s Unity Homes the Next Blu Homes

Tedd Benson, the Brain behind Bensonwood and now Unity Homes in New Hampshire looks to be on the same high road that Blu Homes once traveled….World Domination. At least in the modular housing industry.

Just like the founders of Blu Homes tried and failed to bring folding homes to every neighborhood in the US, Tedd and his minions are telling everyone that will listen that he has the key to doing just that. A chicken in every pot and a Unity Home in every neighborhood.

Just over two years ago I reported that Tedd Benson, the evil cousin Michelle Kaufmann, wrote an article slamming modular housing. He called modular home builders “Twinkies”, for God sake.

Now he's actually using the same methods the rest of us use and describes his homes as cost-effective modular homes. WHAT?!!! He's also is trying to bring in investors and ‘partner builders’ from across the US to try and do what Blu Homes has failed to do.

But just like Blu Homes found that they were inefficient and probably unprofitable selling their homes anywhere but northern California, Tedd may find that staying in the New England area and becoming a ‘Twinkie’ is his best option.

Sorry Tedd but that just my humble opinion.

The excerpt below is from the Nov 12th article in New Hampsphire Business Review. A link to the entire article is at the bottom of the page.

Unlike most homebuilders, Bensonwood builds houses in sections, in a warehouse in Walpole, that are reassembled on site. Most of his career, Benson and his team have been fine-tuning building techniques and efficiency under Bensonwood.

In 2012, he founded Unity Homes to focus on the green, cost-effective modular homes business that Benson is working to expand. Both Unity and Bensonwood homes are built airtight, energy-efficient and with air quality controls.

“As we, over the years, took on more of the building – not just the frame but wall sections and roof sections and floor sections – we really became good at the logistics and the planning and the organization it takes to make really high quality building elements,” he says.

Most Unity Homes have been built in New Hampshire and Vermont, but Benson said one was just assembled in Virginia. (Assembly takes about 30 working days.)

“We’re getting inquiries from Nebraska and California and Washington State, and so the idea is taking off,” says Benson. “But the big concept for Unity is we plan to distribute production throughout the United States. So eventually we want Unity to be a national company, and to make our product nationally available.”

Benson is currently talking to partner builders in Colorado, Kansas City, Texas and in the mid-Atlantic that will be trained on Unity Homes’ techniques and overseen by a member of Unity Homes’ team.

“We’re certain [national expansion] is going to happen, but it will be one piece at a time, as we gather the investors we need,” says Benson.

Closed-panelingBecause building elements are standardized, it makes it efficient to construct the home. But clients can customize a home by choosing a floor plan and interior levels of customization, such as fixtures.

Unity Homes applies its building practicality to shipping as well.

Most homes are constructed with open-panel parts, meaning wiring and insulation are installed on site.

“The closed-paneling which we have – the insulation is there, the windows are in, the air barrier is in place, the moisture barrier is in place, the finishes are on, the wiring is in there, the plumbing is in there,” Benson explains. “Closed-panel production allows us to flat pack when we ship, and that’s important, so we get a lot of home on the truck, and therefore we can ship further cost effectively than for instance modular builders can.”
Modular homes, shipped as whole homes or in halves, can’t travel far.

“We’ll be unique in our closed-panel offering, and we’ll be one of the few that will be a nationally available homebuilder,” he says.

CLICK HERE to read the entire article.