Tuesday, June 17, 2014

A conversation with Commodore's Bob Bender

My next interview is with Bob Bender of the Commodore Corp in Goshen, IN. I’ve met Bob several times and found him to be very open about what he sees for the future of modular housing in the US

Modcoach: Bob, could you give us your background at Commodore and what you did before joining them?

Bob: My title is COO of The Commodore Corporation. We build both modular and manufactured housing. Our Pennwest, Manorwood, Commodore Homes of Virginia, and new R-Anell Housing divisions are exclusively modular, and our Indiana division is nearly exclusive modular. I have been in the industry nearly 10 years, all with Commodore, working across roles from production worker through General Manager to my current role. Prior to Commodore, I worked at Eastman Kodak (when it was a real company!) for 16 years, and as software company executive for another 8 years.

Modcoach: You recently added R-Anell  in Crouse, NC to your list of factory brands. R-Anell has done commercial projects in the past, does this mean that Commodore is about ready to work in that arena?

Bob: We believe our job is to make builders successful and did not want to impact their business models. We have focused exclusively on the residential market, with the occasional small duplex. With our recent R-Anell acquisition, we will evaluate commercial in the future at that facility given its unique capabilities. R-Anell recently completed another hotel project.

Modcoach:  Has Commodore Corp been staying ahead of the curve when it comes to Energy Savings and Green Building?

Bob: It has been interesting to find the right price points to drive interest in energy-savings, as opposed to when required by code. We continue to believe it is both the right thing to do, plus the future codes will require more. Much of energy-saving options require that the builder promote them, and we are always looking for tools and training for them to promote the choices.

Modcoach: You and talked earlier about the changing size of new homes and how the site builders are influencing that. Could you expand on that?

Bob: Average sizes are really driven by the geographic market served, and competitive forces over the past 6 years. I believe smaller ranches and two-stories became tougher to compete with site-builders, who may have been focused on keeping their crews working. That would affect average sizes our companies built. We have seen more interest recently from our builders in smaller homes, which could suggest their local site-built competition could be trying to make some margin now.

Modcoach: I talk a lot about factories having a tough time attracting “new to modular” builders. Have you experienced that?

Bob: We have been fortunate that much of our builder-base has been with us for a long time. Our focus is to help our builders be successful, and the fun part is to understand what success means for each of our builders. We have the financial strength and management stability to offer a broad range of tools. When we review opportunities with new builders, our first job is to make sure we can build them a good home at a fair price. After that, it we have to understand what else could help: unique marketing tools and collateral, custom standards, inventory financing, cash flow support, etc. The real success happens when both parties share the same culture and goals long-term.

Modcoach: I’ve been asking every factory person what they are doing on the social media front. Are you working that side as well?

Bob: We continue to invest in both web and social media and have been for quite a while. We continue to learn from our online sources, and share that with our builders. The interesting hurdle manufacturers may face in the future is learning how far we can communicate with potential homeowners as users expect conversations on social media sites. On a personal note, I’ve been involved in online businesses since the mid-90’s, and used to think I was ahead of the curve. The curve is moving so fast now it has become tougher to predict where things are headed and on what platform.

Modcoach: I also try to ask everyone why the modular housing share of the total housing market is stuck at 3%. Why do you think we can’t get a bigger market share?

Bob: Probably like everyone who has come into the business, it’s exciting to think that a simple 2-3% increase in market share means 100% growth to an industry. What you learn is that the real opportunity is a subset of the overall single-family market. Local restrictions and competitive pressure makes it harder to reach into many urban markets (single-family homes). While we’ve had some success in building subdivisions, it is really tough to compete against most tract or production builders. Once you scale away those markets, the percentage is a little better but the industry should be able to grab a lot more.

It still feels like the modular concept makes more sense than the market share it has today. Modular is really a construction technique and process, not necessarily a different home. I am interested in many things being considered at MHBA with Tom Hardiman, and excited to be part of that. I hope the readers of your blog consider becoming part of that effort.

Bob, thank you for an interesting interview. I completely agree that joining the MHBA is one of the best ways to join together as an industry and work toward increasing modular’s awareness with new home buyers. I wish you and Commodore the best for years to come.

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