Monday, August 17, 2015

Opportunity Lost

Last week I bought a new car and like everyone that buys a new car, I took it for a long drive to get the feel of it and to enjoy those first few hours of smiles and contentment that only a new car can bring.

While on this drive my wife and I traveled about 50 miles from home into a part of the region I had rarely been to. It was near the destination that we had chosen that we came across a very nice site built home going up.

There was nothing special about the house itself but what caught my eye was the great looking sign the builder had, the way the lot was clear of all scraps and building materials and the information box filled with several brochures about the builder. As luck would have it, the builder’s truck was in the driveway and I decided to stop and talk to him.

Let it be known that stopping and talking to a builder for 30 minutes is something my wife has learned to tolerate but not really enjoy. But that’s another story.

I have a routine when visiting site builders which is introducing myself, complimenting them on their home and then asking them if they have ever thought of going modular. This time was no different. However the answer was.

The builder (I’ll call him Steve M) appeared to be in his mid forties and has been building homes for about 15 years. He and his uncle own the company. They build about 9 homes a year but he said that it is getting harder to find land in his area and banks are making it harder for people to get mortgages.

Then came the moment of truth. I asked him if he knew the benefits of going modular. He said that he had never given modular a thought because this is the way he and his uncle had always built homes and he saw no reason to change. With that I slowly told him six things that could help his business if he added modular construction to his business. He seemed mildly interested.

I gave him my card and got his. I asked him to do something for me and it would also help him better understand modular housing. He agreed and my experiment began.

The next day I sent him a list of the 5 closest modular home factories and asked if he would email each of them, with a blind copy to me. asking for information. I got copies of his emails on Monday but didn’t hear back from him by Saturday and sent him an email asking about the results of his inquiry.

Sunday evening I got his email reply. Here are the results.

  • One factory Sales Manager called and invited him to visit their factory where he would explain why modular construction is better than site building. (What a great way to start a relationship - by criticizing his building method)
  • One factory sales rep sent him an email inviting him to tour the factory. Nothing else.
  • Another factory Sales Manager called and told him that they already had a “Dealer” close to him and they were not interested in adding another one.
  • The other two did not reply.
In his email to me he asked if I could come to his office in the near future to meet with he and his uncle about modular construction as I had told him more about it than any of the people that responded.

I called and told him I would love to visit them but it would have to wait until after the Modular Boot Camp on September 16. They were fine with that as they were finishing three homes right now.

Here are some of my thoughts:

  • This is typical of our industry
  • The Sales Manager, the GM or the Owner should be the first contact with the builder
  • Never put down what the builder is currently doing
  • Make sure you follow up quickly
  • Have a sales rep visit the builder before inviting them to the factory
  • Have a step by step game plan in place for new builders
What I saw through this site builder’s eyes was an Opportunity Lost and it didn’t have to be. 

Modcoach Note: I will not tell anyone the name of the builder until after I meet with him in late September nor will I tell anyone the names of the factories. Period.


Anonymous said...

Coach, this is so true of what is going on in the modular housing business.

Anonymous said...

You wrote
Have a step by step game plan in place for new builders.

That will never happen at my factory. All the owner does is hire new sales reps away from other factories and gets their builders. No need to for a game plan with that "Game Plan"


Anonymous said...

I've been thinking about how local builders know best how to market themselves (B2C). And how the factories might just stay out of the marketing business altogether, save for soliciting prospective local builders (B2B). Seems logical right?

Manufacturers: WHOLESALE B2B
Builders: RETAIL B2C

But at the end of the day, the manufacturer has the scale to mount a better marketing campaign. But if they cannot "speak" to the builder's local market, why try? Besides, the message gets diluted in such a large market (Ohio to Virginia to Maine).

MORE MARKET SHARE: Manufacturers must do one thing well: solicit builders and sell their value-proposition. We need more site builders to convert. This is where the factories can really shine. They are builders, too. How can we expect local modular builders to solicit competing site builders? It doesn't happen. Industry must.

CONSUMER EDUCATION: Associations do this well. Consumers prefer to be educated by non-profit organizations that don't have a horse in the race. When factories and (to some degree) builders attempt to sell the modular advantage too much gets lost in the message. When I want to compare a Chevy Camaro to a Ford Mustang I don't ask the Ford dealer which one's better.

JOIN MHBA: if all factories joined Modular Home Builders Association, the funding would be there to mount a serious consumer education portal. One that would drown out the garbled, disparate, confusing messages coming from the awful media, half-baked modular builder websites and slanted factory websites.

RESULT: Economies of scale... Organization.. A cohesive, united voice... More modular market share... More sales for ALL