Monday, November 7, 2016

The Best Modular Round Table of 2016

Just last December I held a Modular Builder Round Table where only builders were allowed to attend. With Tom Hardiman, the Executive Director of the Modular Home Builder Association moderating, the builders overwhelmingly asked that a ‘per module’ assessment be made on each member’s new home orders to create a fund to promote modular home construction.

Less than a year later that movement has blossomed into the MHBA’s Consumer Awareness Program (CAP). And everyone that attended thought it was the best meeting ever for our industry.

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I think this year’s attendees outdid themselves. This year end Round Table saw 9 modular factories attending, 5 modular home builders, 6 vendors and suppliers, 3 Associations representing our industry and one state Director of Industrialized Housing showing up. It was an over sold out event.

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Mary Gaiski, Director of PHMA
The Round Table started off with first time attendee Mary Gaiski, Dir of the PA Manufactured Housing Assoc, explaining the role the PHMA has in helping not only the Manufactured Housing factories in PA but also working with various modular factories. She encouraged everyone to take a look at the work the PHMA has done and what they are currently doing to further the goals of both industries.

Two other first attendees spoke to the Round Table next. John Lingerfelt and Devin Perry from the Building Systems Council of the NAHB explained how the BSC was once again becoming a strong advocate and how to join with others from across the nation to make modular home construction a most viable competitor to site built. With over a 100,000 builders belonging to the NAHB, the BSC is our voice to the industry. If you are not a member of the BSC yet, consider doing it today. John and Perry also announced that attendee Norm Hall, Simpson Strongtie, has been elected as the 2017 President of Building Systems Council. Congrats Norm!

The final association speaker was Ken Semler, a board member of the MHBA and brought us up to date on the new CAP program. Funds have begun to build with many builders and their factories contributing. A professional marketing company was hired to work on CAP and their efforts are starting to pay off with a new slogan, “Ready, Set, Built” being used in many social media forums. The MHBA is a factory/builder/supplier driven association that is working hard for the modular industry.

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Mark Conte, Dir of PA Industrialized Housing
Mark Conte, the Director of the PA Industrialized Housing Dept, gave the Round Table an update of the new regulations for UCC that will affect the modular industry in PA and modules shipped into PA. The new regs are not restrictive just updated to include more of our industry. Level playing field. On a side note, Mark has spoken a my events in the past but this will be the last time he speaks as the Director as he is retiring before the end of the year. I doubt very much that he will break out the fishing gear or jump onto Facebook. He has too much to share with our industry. Congrats Mark!

Gary Fleisher, the Modcaoch
Then is was my turn. Earlier this year I had announced that I would be holding a series of “Breakfast with Modcoach” throughout the East where small groups of modular home builders could share their thoughts over eggs and bacon. 12 cities were on the agenda. Now that has been scraped. In its place is a weekly “Breakfast with Modcoach” podcast featuring ‘news, views and interviews’ that will be free to everyone. I will miss those eggs and bacon. More about this before the end of the year.

The Future of Modular Housing, the real meat of the Round Table was next on the agenda.

Starting with the pre-recession time frame of 2000 to 2007 we covered the:
  • Record Number of New Home Starts
  • Record Number of Modulars Built
  • Record Number of Manufactured Homes
  • Backlogs up to 12 months
  • Industry Sales Reps became Order Takers
  • Confused Cash Flow with Profit
  • Modular 6-8% of Home Starts Nationally

Then we moved into the dark times, 2008-2016:
  • Housing Recession
  • Builder/Dealer Cash Cows closed their doors
  • Orders dropped to near Zero for some factories
  • Cash Flow Dried up
  • Factories went out of business
  • Recovery slowly coming back
  • Modular drops to as low as 1.5% of new starts
  • Time to plan for the future

And finally we discussed the future:
  • An Aging Builder Base
  • Few New Builders coming into the industry
  • Few new factories being built
  • Little investment in existing factories
  • Communication between Builder/Factory
  • Lacking of training/continuing education

The last two topics brought the most lively discussions of the day.
A couple of the Round Table attendees gave quite detailed examples of what is lacking in communications between the parties and have volunteered to put their thoughts together in articles that I will publish when I receive them.

Training was the second hot button and a lot of the discussion focused on why should a factory spend money and time putting together a training program that could benefit their competitors if and/or when their builder decided to change factories. Prior to 2007, factories would not have hesitated doing it but with margins tight and the overall modular builder base shrinking, no one factory can do it on their own.

With that said, here is the big announcement I promised. A group of well known modular industry people have joined together to start a training program to benefit everyone in the modular housing industry. Details of their plans will be shared with everyone before the end of the year and you will hear it here first.

Next year: Builder Breakfasts, Round Tables, Boot Camps and Podcasts...Oh MY! And of course, the blog.


Macropod said...

The table looks modular indeed, but not round.

Harris - Finish Werks said...

Gary - sorry I missed the party. It was a big one no doubt.

I'll quickly add my voice to the CAP program, which Ken and I ruminated on over many phone calls last winter before MHBA decided to implement it:

Those manufacturers that have chosen to NOT collect (or not pay outright) $10/box should get reduced "billing" on any Blog posts. I know I won't make any friends saying this, but I feel that strongly about it. I simply don't accept that it's is too difficult to collect $10 measly bucks when the proceeds will do nothing but help our industry.

If there's any evidence that there is strength in numbers, Tuesday night was it.

I look forward to the MHBA Marketing Committee creating and disseminating collateral materials to all manus explaining the value we have been and will continue to create.