Tuesday, September 23, 2014

Preparing for the Next Modular Housing Downturn

The stronger your business is, the less likely it is to be affected by the next downturn in modular housing. Nonetheless you have to be continually preparing for it.

Strengthening your business doesn't just involve financial management. It also includes strategies to retain and broaden your customer base, market your business affordably, keep morale high among your staff and improve business practices. You should also look for opportunities to network and form alliances; this will help minimize your exposure to risks. Doing these things now will mean not having to ‘play catch’ up if it hits.

To strengthen your business during an economic downturn you should consider the following strategies.

Making customers a priority
Customer service is about providing your builders with what they want, when they want it. If your business provides quality customer service, you have a greater chance of keeping and increasing your builder base. During a financial downturn it is particularly important to find ways to retain your existing builders by providing good after-sales service.

Making customers a priority in an economic downturn may also involve:
  • running loyalty or builder incentive programs
  • adapting your products and services to be more suited to your builder's current needs
  • Diversifying your business to minimize potential damage from the loss of a significant customer. Think what other types of housing and commercial can be built by your factory.

Marketing strategies
Reviewing your marketing strategies can help you come up with new ideas to increase sales and find better ways of using your marketing dollars. You should focus on communicating your competitive and builder advantages. It's important to also develop strategies to measure the effectiveness of your marketing.

Marketing your business can be an expensive exercise, and during an economic downturn it's especially important to explore free marketing tools available to you, including social media and press releases.

Managing staff
Make sure you have an up-to-date human resources (HR) plan. Use your plan to detail your staffing costs, which in turn will allow you to accurately cost your products or services. Will your top reps stay with you if housing starts drop?

Build morale and motivation by clearly communicating with your staff what is happening within the business. Try to involve them in decision-making and finding solutions.

You may also consider training your employees to undertake more duties. You can conduct a staff skills assessment to identify the training your staff may need.

Networking during an economic downturn can be useful to understand how other businesses are coping. Joining and participating in organizations like MHBA and reading this blog will keep you informed and better prepared. You may also discover new opportunities, customers, staff, suppliers and business partners with minimal cost to your business.

Developing innovative practices
Developing innovative practices may help you adapt to changing market conditions and stay ahead of your competitors. As part of this process you should review if using new technology will increase efficiency, reduce costs and make your business more competitive.

Is a housing downturn in our near future? Let’s hope not but like the Boy Scouts Motto says “Be Prepared.” 

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