Builders must develop new business strategies in order to succeed in the new economic reality, say two home building industry business consultants who will be leading workshops at the Custom Builder Symposium + Design Institute on Nov. 6-8 at the Hilton San Diego Bayfront in San Diego.
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DuRoff |
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Koehn |
“No builder would consider building a home without a plan, but many operate their businesses without a plan. In today’s economic reality, developing a vision for your company is absolutely essential,” said Dennis DuRoff, a business coach for builders and remodelers.
During his two-part session at the symposium, “Strategic Thinking for the New Reality,” DuRoff will help participants create new business plans that can serve as a new vision for their companies. But, as DuRoff explained, this business plan won’t be business as usual.
“Traditionally, business plans have been long, laborious, mini-books. What I find to be most useful is a one-page business plan,” he said.
The plans that DuRoff will help symposium participants develop should serve as a management tool and a source of inspiration. “It should communicate a vision to their staffs that will allow them to have an opportunity to buy into the new direction of the company,” DuRoff said.
After helping participants develop a plan, during the second part of the session DuRoff will help participants strategize ways to put the plan into action.
“Most business plans do little more than gather dust on a shelf in the back room,” DuRoff said. “My intent is to give session participants a very different experience. At the session, they will create a strategic plan to use when they get home with their staff, lenders, trade partners and vendors.”
In today’s economic climate, builders need “that central plan to differentiate themselves, to be clear about what their company stands for,” DuRoff said.
Create Value, Not 'Whatever It Takes to Make the Deal'
Beverly Koehn, GMB, CGA, CGR, CGB, CAPS, MIRM, CMP, of Beverly Koehn & Associates, author of “Loyalty is Love,” will lead the session, “Rediscovering the Art of Creating Value.” Clearly defining what a company stands for, rather than merely reacting to market turmoil, will be crucial to success as builders begin to emerge from the downturn, she said.
“The number-one concern for most home buyers — whether they are luxury homes, custom homes or standing inventory — is price,” she said. “Everyone’s concerned about paying too much. Builders have started reacting to this market reality by doing whatever it takes to make the deal happen instead of being proactive.”
This approach will fail in the long term, Koehn said. “In the end, that’s not good for them and it costs them money.”
Instead, builders must learn how to create value; that’s what people are buying anyway. “Price is the tangible, value sometimes is not. You have to learn how to explain the value components to the buyer,” she said.
During her session, each participant will conduct self-evaluation exercises in order to develop a statement of their company’s core values. “I’m going to teach them strategies that will help them make that leap from telling clients that, ‘I’m including this and this,’ to, ‘These are the items you’re going to be receiving. These items don’t have a price tag, but they are services that have lasting value.’”
“Beyond the sticks and bricks that buyers can touch, there are service components that they can’t touch,” Koehn said.
For builders to get to the point where they can confidently demonstrate those “intangibles,” Koehn said they must learn how to define their company’s own core values, which participants will do in her session. “They have to have a clear understanding of their particular niche and be able to communicate that to their buyers.”
The Custom Builder Symposium and the Design Institute for Builders have joined together for 2009 to create one conference event that provides education, resources and networking for custom builders, designers, architects, home technology professionals, remodelers and others. The redesigned event gives attendees the content of two conferences for the price and time commitment of one.
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