Monday, September 3, 2012

Poverty of the Modular Home Builder

When we think of poverty, we think homelessness, food banks and welfare.   

Chronic poverty was once compared to catching a grasshopper in a jar when we were kids.  The jar had a lid with holes poked in it.  For a while the grasshopper jumped up and kept hitting his head against the lid.  Then he would only jump high enough to try to cling to the glass and finally he would just stay on the bottom of the jar and gave up all hope of getting out.

A lot of modular home builders feel that way about selling homes in this tough market.  They have been trying to get out of that jar since the housing crisis hit and now that the lid has been removed they simply don’t have the strength or the knowledge to jump back into profitability.

Poverty by definition is a “deficiency in amount.”  Modular home builders sure fit the criteria.  So what are these deficiencies that face modular builders?

Marketing poverty.  This is a problem because most builders have neither the resources nor the training to mount an effective marketing program.  Modular home factories sales reps have not been taught how to help builders get the message out to the home buying public and the factories themselves don’t market their product.  A page on Facebook and a good website are just the tip of the iceberg.  What is needed to fight the poverty of marketing is someone; either a modular factory group or an individual; to step up and begin developing individual marketing plans for modular home builders.

Knowledge poverty.  How many builders effectively communicate the advantages offered by a home buyer choosing a modular home?  Surprisingly few!  Many builders have limited knowledge of the green, sustainable or energy conservation methods used by the modular housing industry.  The sales reps are supposed to be knowledgeable about these things but they are also facing the same poverty of knowledge.  This is an area that needs to be given special attention by the factory.  There are only a handful of factories that hold builder meetings or offer training directly associated with these topics.  Take a look at your jobsite… do you have a sign on it with all your contact info and your website and email address?

Language poverty.  There are thousands of books and articles written about how to sell new homes, get referrals and retain customers.  What is missing from most of these articles is that an average new home builder only uses 400-600 words when they try to sell their homes.  The builder has become very succinct in the selling phase of the process. They have developed canned speeches that are used in just about every sales presentation.  Unfortunately, buyers have been reading everything they can about new building techniques, architecture and sustainability and want a longer, more in-depth conversations with the builder.  The solution is easy.  Read a book a week and an article a day about the building industry.  Learn the language of the buyer.

Financing poverty.  This is first year of fairly decent new home sales since the housing crisis started and a majority of modular home builders are still not part of their buyer’s mortgage adventure.  Builders still think that after they give the buyer their house quote, the buyer is somehow inherently knowledgeable enough to go forth and acquire one. Fat chance! Builders not only have to know how to build a modular home, they have to become a partner with the buyer throughout the mortgage process. In order to do that, a builder must learn what the buyer will be going through when they apply and help them over the pitfalls and speed bumps imposed on buyers today. This is as easy as sitting down with a couple of lenders and asking what they need from the builder and how best to help the buyer. How many builders still view the lender as a necessary evil instead of a necessary partner?

Stop being the grasshopper on the bottom of the jar and begin taking marketing seriously.  Then learn what your factory is doing to improve the buyer’s lifestyle and actually talk to them as an expert in modular housing.  Then work with the buyer and their lender closely to make the buyer’s dream into a reality which will keep you and your family out of real poverty.

1 comment:

Joel M said...

Coach, maybe it's time for you to step up and be "that guy" when it comes to all things modular. You talk a great talk but are you ready to walk the walk and help builders like me. You have my number, please call me today. I need your help jumping out of that jar.