The Great Modular Home Building Mystery

by
May 12th, 2009

I don’t have to convince you that modular construction is a better way to build than on-site construction, so I won’t try.  I also don’t have to tell you that our industry is underwater, big time, so I won’t press that painful point either.

So where is the disconnect? On the one hand, modular construction offers a far superior building method… and yet no one wants to market it correctly? Seems like a mystery to me.

Well, it’s no mystery, my friends. The sad truth is that in a world that moves faster than the speed of light, things in our industry have not changed one bit. Today, a builder-dealer pulls two sets of wrinkled and dusty house plans out of his cellar and hands them to his customer just as he did fifty years ago. The customer looks from one plan to the other, straining to see the difference between the two. He finally notices that one plan is for a one level, three bedroom shaped in a rectangle. The other is identical except for a portico over the front door. The customer chooses the upgrade with portico and forks over the deposit. Three weeks later the customer and his family move into a double-wide attached to some plumbing lines snaking out to the local water source. The portico is on a truck somewhere and is said to arrive by Christmas. Hopefully the builder will be around to nail it up.

Why are these days still here? Beats me but I do know this. Nothing about the current sales model of modular home building has anything to do with customer satisfaction.  And when you don’t have customer satisfaction, we all know where the potential customer ends up. He ends up across town at the office of a stick builder who charges a small fortune to cover his subs as they build slowly in the freezing and wet weather with inferior materials and a one year time horizon.

Are we seriously going to let this go on? Let them beat us to the customer when we can do so much more for them?

Now that there is less money to go around for home building, the smart factories and dealers are taking a hard look at what they can do to improve the sales experience for the customer.  One of those things is the inclusion of an architect at the beginning of the process, not just when they need a portico.

Why is this important? Because architects work tirelessly to bring air, light, vistas and green savings to the home-buying customers. And the buyers love it so why not show all that expertise at the very beginning of the process right in the sales room of the factory or builder dealer offices. Let’s show the rest of the economy that even though housing got us into this recession, housing will also lead us out.

Here are some ideas we all can implement immediately… a marketing plan for an industry that never had one:

Develop a builder’s dealer marketing/merchandizing infrastructure, to capture more market share.

  • Build sample show room/sales centers at the main factory for select builder dealers to institute.
  • Institute that every builder dealer has a sales center a minimum of 1,000 sf. on a main road with steady traffic count in an adequate demographic location.
  • Offer a wide design selection to compete with what is offered by conventional builders. The look-alike capes, ranches, and two stories, just don’t cut it anymore.
  • Offer a range of stylistic choices such as colonials, Mediterranean, Victorian, Tudor, contemporary, etc.
    • Offer subcategories such as Georgian Colonial, Federal Style Colonial, Shingle Style Colonial etc.
    • Offer a variety of sizes and layouts in a searchable data base to help the customer find the right plan for them.
    • Offer a three-tiered, pre designed and pre-selected finished price package on each model. Ie: Silver, Gold & Platinum.

Builders should offer specific pricing on the vast offerings of homes all from the “sill plate up.

  • Price what is known, based on all that is shown in the picture, both factory built and site built by the builder including any markups the builder desires. No more can we confuse the customer  by separating out the different responsibilities. This old business model makes it more complicated than it needs to be.
  • The builder/dealer can price the site work separately from the sill plate down on a case-by-case basis to cover any special property conditions as well as any markups they feel necessary.
  • Price the fixture and finish packages as well in a tier system. (silver, gold & platinum) to give even more options in the areas where the customer wants the options.
  • We must stop giving away custom design for free or at a lost lead. Charging more for custom design will encourage customers to select from the vast designer selection first. This can only be done if you have a vast selection of professionally done designs. Endless customization will finally give way to stock designs as envisioned by the modular industry founders. If a customer insists on a custom design, make sure it is carried out by a professional architect., one who is experienced in the modular way of building Always put the best design foot forward so we can keep our heads high when the word modular is used in conjunction with the words home design.
  • Institute “design control”.Never let the customer design your product. Quirky-looking, boxy, unprofessionally built homes, drag down the image of what we do and perpetuates the current stigma we have hung around our necks to this very day.
  • Let the customer select… not design. Remember that each completed house is a giant billboard for every neighbor see. Let them see a home designed by a professional, Design control is a must to elevate modular buildings reputation just as it always has for cars and fashion.
    Every builder dealer should have the best of sales people to guide the customers through the myriad of design choices. A background in art history, interior design or architecture is a plus. Having someone who knows the product line well, from styles to sizes, to lot issues, to budget… all should be presented with the utmost professionalism.
  • Develop easy to use, consumer-friendly forms that address site constraints such as zoning & conservation issues.
  • Compress the time it takes to process a customer from months to days. Don’t lose the customer to bureaucracy or boredom. Develop real time, high resolution imaging of the inside and outside of each product offering.
  • Show high resolutions of kitchen cabinets & optional appliances as a bonus.
    Include any alternate product offerings in the walk through renderings.
  • Once the product offering is developed give a visual selection to the specific product type. “Design Sharing” as we call it can help customer visualize products and make buying decisions more quickly. If successful, leasing out virtual space to building component suppliers will be a future revenue source.
  • Charge a franchise fee to the builder/dealer for the sales center system and marketing program.

In closing, remember this. Our fragmented building industry will come to an end. Modular Architecture, offered on a more holistic basis, will increase market share in a more efficient and cost effective manner. Only then will modular construction come of age and lead the way the world build homes.

Watch out Home Depot!

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Comments (2)

YeraBuilderSeptember 1st, 2010 at 11:22 pm

Awesome article, keep up the good work

modular houseJanuary 21st, 2011 at 10:34 pm

Modular homes have endless design possibilities. After choosing your builder, discuss any specific customization you may want.

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