Wednesday, August 19, 2015

Sell, Build, Repeat Often

It doesn't matter if you are a modular builder or a site builder, you know that selling and building homes is cyclical. Building season is here but so is the selling season.

If you custom build homes you are aware that from the time of the first contact to the day you start the house an entire year could have passed. The actual building time is a relatively small part of that process. But did you realize that two building seasons and two selling seasons also happened over the course of that same year.

BUILDING SEASONS:
Using the northern half of our country as the example, the first houses of the new year are built when the first robins are sighted and the second wave before the first penetrating frost. These houses were sold between 6 and 12 months prior and during construction a lot of your time is eaten up with visiting jobsites, ordering inspections, meeting with your customers, working with subcontractors and actual physical work at the jobsite.

Your Spring start homes have people that want to move in before little Johnny gets out of school and they take their vacations. Your Fall start homes are people that want to be in before Thanksgiving.

If you only did 2 houses a year, one in each season, this wouldn't be a big problem, but we both know you won't make very much money on two 2,100 sq ft homes unless your Blu Homes who sells homes for $350 -$500 a sq ft. Let's assume your building 8 homes this year, that means that ideally you should build 4 in the Spring and 4 in the Fall. Like that ever happens!

Building 8 houses puts a lot of pressure to meet both the customer's goals and yours and how you deal with it can make the biggest difference.

Building modular homes gives you a huge advantage over site builders in the time needed to set and finish homes as well as controlling costs and usually making more profit.

SELLING SEASONS:
As with building seasons, there are two selling seasons. The first is February through June and the second is July through November.

The people in the first season of the year want to be in by Thanksgiving and the second season people want to be in before school is out. YIKES!

But here comes the rub. Did you notice that the building season and the selling seasons happen at the same time? It's like the guy that had a bad furnace and a teenage daughter, when he watched one, the other one went out!

And to make matters worse, the buyers hold the timeline when it comes to signing the contract and starting the house. If they drag their feet in the design stage and again in the financing stage, your starting date keeps getting pushed back. Who do you think they will blame for not getting into their house on time...you got it...YOU!

So what is a builder to do to keep projects on schedule, market and sell homes and finally to make sure everything is going smooth at the jobsites? That's easy, they just have to clone themselves into 3 or 4 new people.

Not! What has to happen is delegation! If you a sole proprietor, the job is difficult but not impossible. You need to hire one good supervisor or one good sales/office person. And when I say good, I mean someone that can think ahead and with your best interests at heart. They are out there, especially in today's job market. Experience is the key here. Hire the best you can afford for the position, give them your guidelines and let them go. You must monitor their activities but that's a lot easier than doing everything yourself.
If you have built your business by being good at helping people realize their dream of home ownership and getting them to sign a contract for their new home, then that's what you need to continue doing. If your being "hands on" in the field is what brings customers to your business, then stay there and hire the best sales/office person you can find.

2 comments:

Fuller Modular Homes and Offices said...

Coach, You're reading my mind! Your advice is exactly what I recently decided on after considerable thought, trial and error. My Father, mentor and best fiend can't be beat in the field and compliments my sales efforts. As a result, I'm in the market for a young eager person capable of both post sales interaction with customers but also with the ability and interest in field work as my Pop is considering retirement. I know this is a tall order but we're working closely with the area Technical Schools and have met several bright ambitious candidates.
Kudos Coach! Your input is very helpful. I need time to turn deliveries into cash flow but we plan on becoming advertisers. If your reading my mind so closely, I can only deduct that your doing the same with others just like me!

Rasal Khan said...

It is very good post