Profitable Ideas

It has never been tougher to make money in home building. However, here are a few ideas that you can explore to see if there are opportunities for you to lower costs and generate more revenue now.

Make sure that there is no place where money is being wasted and going up in smoke.

Sales & Marketing

  • Manage every lead like it was your last. This can be done even when using outside sales people. Systems can track all lead follow-up and nurturing. Stay on top of what is being said and done with each and every prospect. Learn why prospects don’t convert and make corrective actions when you can.
  • Manage every buyer for maximum profit. Use systems to know the maximum amount a buyer can spend and track how much more is available. Track all option decision dates to know when to push for a decision before an opportunity is lost.
  • Track traffic to know its source and the marketing activities that are generating it. Systems can help to associate marketing actions to results. Make sure your marketing dollars are going to good use.
  • Take full advantage of Internet marketing. Have a great website that is easy to update & keep fresh, leverage social media such as Facebook & Twitter. Stay current & relevant.
  • Track buyers to see where they came from. Traffic is one thing, actually buying is another.
  • Track canceled buyers to catch them when they come back into the market. Create automatic marketing campaigns for these people.
  • Track home owners to make sure that they are happy and ask, ask, and ask again for referrals. Create automatic marketing campaigns for home owners. Marketing systems can help.

Purchasing & Construction

  • Buy commodities, such as lumber, on a cost basis vs. on a bid basis. How much over cost are you paying? If you don’t know, you could be paying too much.
  • Bid trade costs by category once a quarter for all jobs based on annual usage vs. next house or community? If you can not bid that often, look at electronic bid systems to assist.
  • Bid at least 4 and as many as 10 sub-contractors to find lower costs. If you can not bid that many, look at electronic bid systems to assist.
  • Participate in 20 to 50 manufacturers’ rebate & incentive programs, generate $500 to $2,000 per house. How many programs are you participating in?
  • Don’t over-engineer. Utilize experts from the manufacturers to value-engineer all products again.
  • Don’t over-build. Examine buyer interests and wants and don’t be the most expensive house in the neighborhood.
  • Build it right the first time. Everyone on the same system is a “must” to manage all communications and commitments between the buyer, the builder, and the sub-contractors. Make sure it is easy to keep everyone on the same page with the same information.
  • Build it fast. Use systems to manage the schedule and communicate who needs to be where and when.

Systems, Technology & Administration

  • Outsource where ever possible. Utilize captive design centers, sales centers, administrative centers, and systems centers. Put all of them onto your systems. Many companies working on a single mission.
  • Get rid of all computer servers, use “Cloud Computing.” Trade high cost, high maintenance for high value, low cost, pay as you go. Get more for less.
  • Use fully integrated systems. No gaps. No entering data more than once.
  • Don’t over-complicate the systems. Only put in data you can use. Don’t let systems cripple your business and how you want to operate. They should do the opposite.

If there are other ideas that you have, please let us know what they are. If we can be of help and assistance in any of these areas, please contact us.