Builders: Do You Share These Pain Points?

Interesting recent BuilderOnline article by John McManus noting that the benefits of the current recovery in homebuilding appear slanted towards the very large, production homebuilders.

CPS FieldCollaborate:
Cycle-time Improvements Start Quickly

Market Gains Aren't Equal Across the Builder Landscape

Today, smaller builders, says McManus, are working harder and have a bunch of "math basics" working against them.  Larger builders are able to optimize finance structures as well as relationships with land sellers, vendors and distribution networks.

In many cases, the result, for smaller builders, is a profit squeeze. Labor and material costs are increasing and builders report usable lots aren't as available and are more expensive.

Technology Investment as a Tool

Are these some of your pain points? There's a few more: McManus goes on to say that many of the "smaller builder positives" such as local land knowledge, long-standing vendor relationships and local homeowner referrals don't hold as much sway as previously.  And, there is the Millennial home buyer with all sorts of different objectives, priorities and shopping patterns.

Add to that, larger builders have invested in sales, marketing and operations-focused technology -- and the results are making for a much more competitive marketplace.

Interactive Technology lets you eliminate static displays

Dial-up Your Motivation to Locate Solutions

One solution, McManus suggests, is locating capital partners to achieve better margins. That's certainly an option for some.

Another is reviewing and evaluating current operations. Are you still operating with pen/pencil on the operations side? There are relatively inexpensive, easy-to-use construction management software products such as CPS' 2018 Constructech award-winning, cloud-based FieldCollaborate that can be implemented quickly and start paying off in decreased cycle times and increased communications with vendors and buyers. Buyer referrals still resonate -- grab them as a result of technology use! Available anywhere/anytime for field managers, vendors, home buyers, corporate users.

Take the opportunity to examine how well you are telling your home shopper's story, as well. Step away from tired, static displays and utilize an interactive presentation -- consider an iPad or Surface tablet  if a larger display isn't feasible.

Upgraded marketing tools create an environment appealing to the ever-growing Millennial buyer and responding to their need for new ideas, designs and uses -- and, interactive technology is the way they're used to purchasing.  Adding interactive technology doesn't need to be an incremental increase in cost -- you're able to eliminate the wall-mounted floorplans and pre-printed brochures with products such as CPS' SalesTouch. 

Builders: Using Software to Help Ease Margin Pressure

Are you a homebuilder focused on the entry-level and first-time home buyer market? That portion of the new home market is hot -- and the Millennial home shopper is more focused on purchasing than ever before!

Are you experiencing price increases on basic materials? How about difficulty in obtaining labor -- especially in critical trades? Labor shortages lead to price increases -- and these factors mean you're seeing margins being squeezed.

Now is a good time to focus on Operational Excellence

Recently, John McManus had a great article in BuilderOnline. McManus notes there's an opportunity today to motivate apartment dwellers to purchase homes. Home shoppers prefer new -- and apartment dwellers don't need to sell their current home so there are fewer strings attached to the purchase.

But, these buyers are at the first-time, entry level price point so price increases on the builder side indicate a need to be extra focused on what could be considered controllable costs to maintain margins. McManus notes builders are "doubling down" on items under their control such as construction cycles and workflows.

Construction Scheduling Offers an Effective Management Tool

Cycle time doesn't live in a vacuum -- and can't be determined or measured in the abstract, either. Do you have a published schedule -- do you track progress against it? Does everyone look at the same schedule or are there multiples floating around within the organization? If so, there's where inefficiencies multiply!

If there's one schedule, not only can you measure cycle time but you're able to provide consistent, reliable schedules to your vendors. That's a win/win as your vendors can rely on your schedule to book their crews. That lets your vendors get and stay efficient.

Construction scheduling software will help you develop the tools so there's only one schedule (for everyone -- within and outside the organization). Not only can you track and measure against it but..your vendors will have easy access to it and can rely on it.

CPS FieldCollaborate: Award-winning Construction Scheduling Software

We're available to provide a FieldCollaborate demo -- and we'll show you how to implement and use software that has resulted in up to 30% cycle time reductions -- day in/day out!

Yes! Boomers Are Buying Outside the "Smile States"

John McManus noted in a recent BuilderOnline Consumer Trends article that the US population is now 325.3 million and added a fact, that frequently goes unnoticed: the US population is getting older.

Millennials, Boomers .. and multigenerational, too!

There's been quite a bit of fanfare recently noting Millennials are finally entering the new homes market; yet, the median age across the board has gone up 7% since 2000.  More startling: the 65+ population has grown 40.5% in the same timeframe.

And, every state has experienced an increase -- or remained constant.  Maine has the highest median age (44.6) (compare that to Utah with the lowest at 30.8)!

What ideas might be drawn from these numbers?

Certainly, there's demand for 55+ communities in what are thought of as "traditional 55+" areas (for example, Sumter, FL has a 67.1 age median).  McManus suggests that builders and developers consider every area has 55+ potential -- and that there's a significant demand for multigenerational product, as well.

In other words, communities are drawing buyers from a wider audience than ever before -- and the audience is more diverse.  What seems to be consistent, McManus notes, is the interest in carefree living.  Accessibility -- in terms of interior space as well as outside the community -- and lifestyle -- think both community and surrounding neighborhood amenities -- are drivers as folks think about how they want to live as they get older.

Take a look at recent Solutions Blogs regarding walkability, amenities, green living, even floorplan options -- and how an interactive presentation -- we're highlighting CPS' SalesTouch -- will help tell your story more effectively to the range of today's home shopper audiences.

Homebuilders: What's Different About 2017?

Interesting John McManus article in a recent Builderonline titled: Spring 2017: A Different Market. Take a look here.

FieldCollaborate: Tools for Today

McManus suggests that the just out of recovery market of 2 years ago is no longer.  Previously, demand for new homes was from the higher-end buyer.  Buyers weren't too concerned about qualifying and had definite ideas about what they wanted in their new home. To some extent, pricing was elastic.

Today, McManus says, it's a different market.  Now, the growth spot is lower-end, further out geographically with lots of communities open and selling homes. More competition, in other words, with a clear focus on price.

The change has put lots of stress on builders.  Lower sale price homes dictate a focus on margins. Costs are going up. It all translates into more of a push for volume.

McManus quotes a builder: We haven't spent so much time and focus on start-to-completion cycle times in six or seven years as we are right now.  It's really basic stuff of doing what we do, only doing it better and faster. Otherwise, we can't get the margins we need.

This type of market needs tools to help manage, measure and report.  Take a look at CPS' FieldCollaborate -- construction software designed to help you define, track and analyze your cycle time and highlight problems meeting your goals.  Improve communications -- both internally and with vendors. Reduce callbacks with task-specific quality checklists. Keep your field managers off their phones with automated followup and reminders.  We can help you meet the challenges presented in today's market.

New Home Construction: Velocity and Profitability

Are you on the construction side of the new homes industry? Great recent Builderonline article by Mary Salmonsen; you can read it here.

Shifting focus to velocity can enhance profitability

Salmonsen highlights one of SAI Consulting Fletcher L. Groves' concerns: the under-consideration of project velocity in builders' business processes.

Or, to paraphrase a comment by John McManus mentioned in a previous Solutions blog: builders need to work with greater velocity or... learn the pain.

In other words, rather than putting a laser focus on individual lot margins, apply some of that attention, data collection and reporting to the amount of time required to build that home. That's cycle time.

Of course, cycle time doesn't live in a vacuum -- and can't be measured in the abstract, either.  Do you have a published schedule -- and do you track progress against it? Does everyone look to a specific schedule or do you have multiples floating within the company?  If there's one, not only can you measure cycle time but you're able to provide consistent, reliable schedules to your vendors.  They're able to better plan and their planning helps them become more consistent, efficient and profitable. That's a win/win!

Are you able to report on which vendors show up on time, or have the highest level of rework, consistently have safety issues, always fail field inspections? That information helps shape a long range vision of your construction cycle and helps deliver consistently better results.  And, it should be available relatively easily and consistently to be effective.

We'd like to suggest CPS'  FieldCollaborate as a software tool to help you develop consistent schedules and measurement tools.  You're able to quantify and measure quality items, delivery times, subcontractor consistency, safety assessments and punch items.  It all helps highlight factors impacting your construction cycle and allows you to be proactive about the next lot, phase and community -- and design for long-term profitability.

New Home Construction Data: Helping You Design For Long-Term Profitability

Did you have a chance to check out Pain Points: Win or Learn by John McManus?  He focused on 3 things that matter most for builders -- today!

And, those 3 things are within every builder's control (vs. those you can't control such as weather, the economy, etc). Not just large builders, or public builders, or small mom-and-pop builders. All builders.

FieldCollaborate: Moving Beyond Scheduling to Meaningful Data!

The first was sales.  The second is taking those sales to completions

That is, the construction cycle. You are able to evaluate how your construction process is delivering by reviewing specific information: cycle time and, in turn, profitability.  

McManus suggests: work with greater velocity or... learn the pain.

Greater velocity can't be measured in the abstract, however.  Other factors -- and they're measurable, too -- have to come into the equation or profitability is a one-time gain with a short life.

What are you doing to understand those other variables?

Do you know which vendors show up on time, or have the highest level of rework, consistently have safety issues, always fail field inspections? That information helps shape a long range vision of your construction cycle and helps deliver consistently better results.

We suggest FieldCollaborate -- including the available web Portal for vendors and home buyers -- will help.  It's not just about scheduling, any longer.  You have to consider reporting on quality items, delivery times, subcontractor consistency, safety assessments and punch items.  It all helps highlight factors impacting your construction cycle and allows you to be proactive about the next lot, phase and community -- and design for long-term profitability.

More on Spring '16 Home Sales: Is a Reality Check Needed

Super interesting BuilderOnLine article recently by John McManus, Spring 2016 Pain Points -- with some good commentary afterwards, as well.

SalesTouch: delivering your value proposition message

McManus asks, As a builder, what's your biggest worry in Spring 2016?  And, he offers 4 possible answers: Lots, Labor, Lending, Demand. He suggests most builders would answer: demand.

But, he asks: is that really the case? There's been demand since early 2014; although, he argues, in only certain market segments. If those segments were your segments: all good!

Some builders focused their efforts (throughout the organization) on lower margin product and they've been able to find and satisfy demand at the entry level. It isn't, McManus suggests, going to be that straightforward for others to successfully satisfy the lower margin market.

Where is your organization in terms of meeting demand this year? There can be internal constraints (organization, product, execution, profitability) as well as externals such as interest rates, consumer credit scores and area-specific economic issues (such as those currently impacting oil/gas-centric areas).

SalesTouch Mobile: Enhancing every consumer touch point

And, McManus suggests, not only do you need product that meets your buyer audience but your buyer expects you'll deliver on a promise to help him/her improve their own value as a resident.  

Where are you? Is the Spring 2016 the market of 2014 or 2015?  Or, are your revamping how to interact internally and externally with the home buyer? How are you telling your story -- and is it delivering on your unique value proposition?

Take a look at SalesTouch -- we think CPS can help you effectively deliver information -- product, location, design, function and features -- in a focused manner designed so your home shopper gains confidence in your ability to deliver the value proposition.

Builders: Proactive Translates Well to Productive and Profitable

Builderonline's recent Pain Points: Win or Learn article by John McManus highlighted a timely point: 3 things matter most for builders this morning!

And, all 3 things are within every builder's control (vs. those you can't control such as weather, the economy, etc). Not just large builders, or public builders, or small mom-and-pop builders. All builders.

This Blog will focus on the first controllable: sales.  Everyone has their eye on trends, projections and actual sales. Sales are important because they're not just a clearly identifiable way to measure actual vs. budget but provide insight into what your buyer profile is looking for in a home and where your product stands in terms of delivering.

What are you doing to make sure your story is being told most effectively?

Using technology to tell your story!

Today's buyer -- whether Millennial, GenX or BabyBoomer -- is using technology to search, review and rate communities and homes.

Yesterday's broadcast marketing (same information to all participants) doesn't meet today's buyer's need for individual focused narrowcasting addressing their objectives.

Have you taken a look at interactive sales presentations?

Are your buyers focused on neighborhood, schools, recreation?  Tell that story with an interactive map highlighting the interesting, unusual and local favorites.

How about the variety of home customization options offered? Let your buyers mix/match the options to "build" their new home! Offer them the ability to "mark up" the plan with notes, names and wishes and then email it to study at home. This home shopper just transitioned from the brochure floor plan to their home!

Let technology not only tell your story but inform your buyer that you understand their stories, hopes, dreams and needs.  Every buyer segment responds to this message!

CPS has been providing interactive touchscreen systems since 2008; ask us to show you how SalesTouch can enhance your current marketing program and help address the first controllable: sales!