Saturday, February 25, 2017

Part One of Survey Results are In

My first ever survey trying to get the pulse of the modular housing industry is in and a couple of things have caught my eye. Over 100 of you from all over the country took the few minutes to fill it out.

The survey was in two categories, what builders thought of their factories and what they want in continuing education. The second part of the survey will be published in a few days.

The first question is interesting for 2 reasons. 77% of all modular builders have been in business more than 10 years. Only 2% have been modular builders less than 3 years. Our aging builder base is not being replenished fast enough.

1. How long have you been a modular home builder?

Less than 6 months 2.0%
6 months to less than 3 years 0.0%
3 years to less than 10 years 20.8%
10 years or more 77.0%
No Responses 0.0%
Total 100%

Everyone is looking for a good 2017!

2. Are you looking for your 2017 business to be:

Better than last year 81.2%
about the same as last year 16.6%
worse than last year 0.0%
No Responses 2.0%
Total 100%

A couple of things to look at here. Almost 22% of modular builders say they are building tiny homes, granny pods and ADUs while 10.8% say they are also offering HUD homes.

3. What do you build? Select all that apply.

custom modular homes 97.8%
site built homes 19.5%
commercial (stores, hotels, etc) 26.0%
multifamily housing 36.9%
tiny homes, granny pods, ADU 21.7%
Other 10.8%
Total 100%

Factory loyalty can be deceiving. If a builder's primary factory doesn't produce the type of modular they need, they are probably buying from two. For example, the primary factory may not want to build commercial projects which means the builder has to look at one that does. Almost one in four builders buy from 3 or more factories. That is interesting.

4. How many factories do you buy from?

One 20.8%
Two 41.6%
Three 12.5%
More than 3 18.7%
No Responses 6.2%
Total 100%

These percentages really can't get much better. Modular builders really like the advantages of building product produced in a factory and shipped to their jobsite. Great news for our industry and something sales reps can use to bring site builders into the world of modular construction.

5. How would you rate your level of satisfaction overall with modular construction?

Highly satisfied 45.8%
Somewhat satisfied 41.6%
Neutral 6.2%
Somewhat dissatisfied 6.2%
Highly dissatisfied 0.0%
No Responses 0.0%
Total 100%

Most builders answered these questions as Above Average or Well Above Average except for the service department and in-factory training. Two areas that everyone is well aware of.

6. How do you rate your primary factory on the following attributes?
1 = Well Below Average, 2 = Below Average, 3 = Average, 4 = Above Average,
5 = Well Above Average
1 2 3 4 5

response time on quote requests
4% 13% 26% 41% 15%
Professionalism of sales rep
2% 0% 33% 38% 27%
overall quality of product
2% 2% 35% 48% 13%
service department
0% 20% 33% 39% 9%
engineering department
9% 2% 28% 39% 22%
2% 7% 37% 50% 4%
factory training
20% 29% 22% 18% 11%
time from signed contract to delivery
4% 9% 52% 26% 9%

Here again the majority of modular builders love their primary factory while only 6.2% say they might jump ship. This is a indicator that factory sales reps need to have a conversation with their builders and learn if one of them has been thinking of going elsewhere.

7. How likely are you to continue doing business with your primary factory?

Very likely 72.9%
Somewhat likely 16.6%
Somewhat unlikely 6.2%
Very unlikely 0.0%
No Responses 4.1%
Total 100%

Here are some comments made about factories. As you can see, there is still room for improvement:

Factory training does not exist as far as I'm concerned. I love calling the plant to find out what that black square on the set print is and find out it’s a very detailed assembly for wind share --A BLACK SQUARE ?? REALLY??

Ceiling issues are constant problems.

Not enough good factories in the South to buy from that build true crane set modular. Backlogs are usually taken from high dollar commercial projects.

I'm here in California where factories locally want the business but struggle with doing MODs and HUD product at the same time.

The current Factory we get our homes from just needs to change some of the way things are done.

Top management/ownership at our primary factory is virtually inaccessible therefore, like the parallel with FedEx drivers being the face of the company for us, our regular contacts are with people whose first filter is that of an employee and not entrepreneurship. To a person they are good people, proficient and well-meaning but lack advocacy skills and/or horsepower to foster change and/or be our voice with clarity and emphasis with ownership. Owners have admitted the failing but not fixed it.


Anonymous said...

The part about the aging of modular home builders is also shared by their site built siblings. Why would anyone want to begin building houses to earn a living?

Builder Bob said...

I find it interesting that over 20%, one out of every 5 modular home builders, are building tiny houses, ADU's and other non traditional modular structures. 10 years ago probably no modular builder were selling these. The factories are looking to expand their market share and increase sales and yet I know of none that are building these. Where are the modular home builders getting them? Are they stick building them? Coach did an article about tiny houses about to fall under IRC codes. Wouldn't that be incentive enough for factories and other builders to take a hard look at them.
Almost 20% of the builders buy from 3 or more factories. Why?

Steve L said...

Tiny House production example