Category Archives: NEWSTAR

How home builders find savings by implementing software and deploying integrated and automated services for building tasks.

Our client’s success is our number one priority. Money matters a lot in homebuilding, every dollar counts, and beyond improving your product offering, finding the right land to build on and acquiring resources for the right price – investing in a homebuilding system that’s truly integrated could be the investment to save you money and resources in the long run.

As you will see, our findings show that an average home builder producing 200 homes at an average selling price of $350,000 and approximately 30 employees can profit from integrated management software by improving hours of ineffective process and optimizing the margins of their operations. We have taken a conservative estimate for wages and for all other variables, and this standard is based on decades of industry experience with hundreds of home builders using Constellation software in their business.

Profits during the Building Cycle

Calculating Field Construction and Sales Operations Savings

The industry standard index dictates that the average building firm of 30 employees about 10 percent would be directly involved in the construction process (3 employees), each builder would be compensated an average of 25 dollars. Due to improved data flows between the head office and on-site builders, each builder will save 4 hours per work week since manual paperwork is eliminated. Considering a 50-hour work week. It is estimated Builders can save an average $15,000 per year.

Hours per week saved due to automation = 4 Hours

X

Weeks worked per year excluding weekends = 50 weeks

X

Hourly wage = $25 Dollars

X

How many builder/ superintendents employed = 3 Builders

TOTAL Savings Per Working Year = $15,000

Calculating savings due to Reduced cycle time due to field integrations

More importantly, the amount of savings created from improved communication between builders and trades is around $90,000 dollars per year. A builder invests significant capital in terms of labor for each extra day a home sits on a lot incomplete. With the new and improved scheduling capabilities integrated back into your accounting process, expect a 6-day decrease in your home build cycle which ultimately cuts costs.

Number of homes built yearly = 200 Homes

X

Number of reduced cycle days for builds = 6 Days

X

Estimated cost per day when a home is under construction = $75

TOTAL Savings Per Working Year = $90,000

For more on NEWSTAR’s Scheduling benefits with on-location scheduling, see how DSLD Homes accomplishes a 43-day building cycle on each home, try “5 Keys to Effective Trade Management”

Calculating improved margins from field integration/scheduling

The biggest return on investment procured from the construction process will come from integrating your field operations with your schedules. Considering the 200 homes built annually by our sample builder with a 2% savings in upgrade costs averaging to about $ 35,000 per home closed – a building company can find new revenue of $ 140,000 simply by paying attention to the productivity of model upgrades and ensuring that the product upgrade process fits perfectly within your existing construction and trade management process.

Average upgrade revenue (option dollars) per closing = $35,000 Dollars

X

Improved options margins with field integration/scheduling = 4%

X

Number of employees = 30 employees

TOTAL Savings Per Working Year = $140,000

Savings Generated from Minimizing Back Office Manual Work

Calculating Home Closing Entry

Builders/superintendents are each spending 4 hours weekly processing POs. Within a company of 30 people, 1 person works full time administrating work orders and 1 person also helps on a part-time basis. At the end of the year, having a manual process is costing you roughly $ 7,500. As an integrated technology provider for home builders, our concern is the build process. An inconsistent process will also incur the builder running costs from building errors.

Hours spent weekly per builder Processing invoices/work order/PO’s = 4 Hours

X

Working weeks = 50 Weeks

X

employees are allocated to Invoice/PO/Work Order Processing = 1.5 Employees

X

Hourly wage = $25 Dollars

TOTAL Savings Per Working Year = $7,500

Calculating Hidden Costs, controlling committed cost

Industry hidden costs accumulate over the year from work order processes lacking accuracy in capturing billable and back charge items, keeping consistent to contracted pricing, consistency with buyer selections, and timely ordering and delivery of resources. With integrated software from warranty, to sales, keeping a steady schedule all the way to accounting. Our prospect builder will save $ 87,500 per year while creating an impactful home buying experience to earn them future referrals.

Average base home sales price = $350,000 Dollars

X

Industry % – Hidden Costs, controlling committed cost = 25%

X

Number of homes built yearly = 200 Homes

X

Conservative adjustment = 50 %

TOTAL Savings Per Working Year = $ 87,500

Revenue Generated from Improved Process for Interior Decor Upgrades  

Design center appointments are the new expectation when buying a new home. The secret to increased revenue for interior upgrades is to offer your homeowners enough customization to please them without sacrificing your automated process. For example, our customers are finding improved appointment productivity with our new product, Design Studio Manager. With a standardized décor center selections process that promotes relevant products to your homeowners, it is estimated that a NEWSTAR user with a Design Studio Manager integration is earning $15,250 dollars yearly (seems low; overall per year or per house per year? Or per week?). $5,250 dollars in earned revenue from having a software system that promotes your upgrade products logically. While the remaining $10,000 is saved money calculated by the manual process your décor agents would have spent selecting products for your homeowners manually.

Calculating Design Studio Revenue Savings

Time savings from integrated design software = 1 Hour weekly

X

Number of homes built yearly = 200 Homes

X

Hourly wage of a designer = $50 Hourly

+

Upgrade revenue per closing = $ 35,000

X

Percentage increase for optional upgrades = 15%

TOTAL Savings Per Working Year = $ 10,000 + $5,250 = $15,250

 

Savings While Providing Homeowner Care and a Simple Buying Experience

Closer to home sale, builders on average are spending 2 hours with each new homeowner drafting contracts / coming to a sale agreement and 1.5 hours entering home close information. Over the course of a year – the prospect builder would have invested $17,500 for a task that otherwise could be automated. With NEWSTAR, expect sales selections to update in the accounting main module for the real-time budgets analysis and current financial terms. Also, home walkthroughs can be completed on-site with NEWSTAR’s on-location warranty module that directly integrates with the scheduling and accounting departments in case of late-extras or any final adjustments for the fastest reaction time possible.

Calculating Warranty Process Savings

Homebuyer Agreements – Hours spent per home = 2 Hours

X

Number of homes built yearly = 200 Homes

X

Hourly wage = $25 Dollars

+

Hours eliminated from automated home closing entry = 1.5 Hours

X

Number of homes built yearly = 200 Homes

X

Hourly wage = $25 Dollars

TOTAL Savings Per Working Year = $10,000 + $7,500 = $17,500


The Verdict

After examining our clients and their financial performance before and after their NEWSTAR implementation. A home builder producing 200 homes yearly will save $363,625. Over the long term, the return on investment for implementing an integrated software solution comes to $1,818,125 in just 5 years. We acknowledge that all homebuilders are different and operate under many different variables. With the help of industry experts, we have created an ROI calculator to help you customize your potential revenue that is possible with software implementation. Calculate Your Savings today.

Posted in Best Practices, Blog, Field Scheduling, NEWSTAR, Uncategorized | Leave a comment

It’s a visual world – develop your product from the inside out

This content was co-written in collaboration with Kim Bianchi, leading Décor Studio Manager at OPUS Homes

A home is where memories are made; where homeowners spend time with friends and family. These moments are the backdrop of a successful builder. Your buyers are increasingly sharing experiences online with builders for better or for worse. Social media sites like Instagram, Pinterest, and increasingly Houzz – are all giving homeowners a precise picture of the final product and service you are offering. Make your homes visually appealing – your builder product and brand will speak volumes in the market. What strategies are you taking to ensure your décor centre is assisting company growth?

Tip 1: Customize homes without sacrificing growth

Offer your homeowners the ability to add the final touches to their home’s interior. Do this in moderation. Successful builders understand that building custom homes from the ground up is contrary to scale. Allowing your homeowners to choose their interior selections involves you spending personal time with homeowners, allowing for interior finishes means you can increase the valuation of your homes sold. This too can be an opportunity and a differentiator amongst builders looking to secure a “premium” builder brand.

Tip 2: The homeowner is always right – interior décor demand is a sales opportunity

Customers need confident validation from the builder that interior décor is the right option for their investment. The trick to interior décor as a builder is to position the design studio experience as an educational session on their home. By now, if your customer is considering décor finishes, they must have already selected a house model. Ensure that your décor appointments follow guidelines of what fits best with their selected product. Smart builders give enough choices to their homeowners while strategically controlling what’s possible for each type of home model in terms of installation. Builders are also implementing online design portals based on each homeowners style and capabilities within the each selected home.

Tip 3: Get personal at décor appointments – ditch the paperwork and go digital

Décor Studio Manager, Kimberly Bianchi of OPUS Homes shares the value of an integrated design centre solution. “Design Studio Manager is easily customizable for our growing décor selections. The software provided us with an efficient and logical workflow for our appointment sessions”. OPUS Homes clients have the opportunity to access an online portal, before meeting with Bianchi to complete their décor selections, where they can view available finishes options for their particular model of home and save any “wish list items” to be further discussed the day of the appointment.  Bianchi carries a tablet around the décor studio which allows her to be mobile with her clients while she educates them on their finishing options.  She is logged onto the design agent portal and utilizes it as a tool to guide the homeowner through the décor studio’s product library. Each client takes home a detailed document of all selections added. This method provides OPUS Homes with meaningful real-time data. In the future, Bianchi is excited to implement the floor plans module which allows for digitally integrated redline floor plans that communicate back to NEWSTAR for drafting contract addendum items.

Tip 4: Integrate décor appointments to all your departments

Great software ultimately should ensure customization in a manner that is logical, that brings efficiency out of décor appointments and integrates the customer data to all other departments. OPUS Homes design studio software pushes the data out to their accounting platform for updated production costs, warranty information is logged for interior selections for possible future claims, trades are also notified and their schedules are customized so the interior selections can enter the home after the initial build so there are no damages. It is always costly when materials are installed incorrectly or worse, products must be destroyed and re-added if critical infrastructure is yet to be set up.

Tip 5: Join the décor studio expert panel on modern design studio appointments

Hear from builders how new technology is improving the design studio experience. We are hosting a free webinar with a panel of sales, marketing and design studio managers will discuss how Design Studio Manager has transformed their customer’s experience of the design studio, as well as preliminary impacts on sales of options and upgrades.

WHY: Hear 3 Builders Share The NEW Design Studio Experience

WHEN: April 25, 2PM EDT / 11 AM EDT

Register NOW

The Verdict

Interior customization in moderation can make you a more profitable builder if integrated correctly, reap higher margins and position your product as premium in the market. The right software allows options available for the homeowner that is pre-established for each home model. The right system allows your homeowner to get creative and become part of your building team. Select software that showcases your selections in a logical order that reflects the building process once the interiors are ready to enter the home. Finally, Your décor software should tie all departments back to everything that occurred at the décor centre. Accounting should have an accurate amount of the home price, the warranty department needs the selections information logged in case of future incidents, and trades need their schedules set out in accordance with the selections and the building process. Homeowners expect high-end products, a standardized décor studio process is key to meeting this demand.

Source: Custom Builder Talks Design Centers and Trends That Sell | Builderonline.com – Leah Demirjian

Posted in Best Practices, Blog, Case Study, Customer Story, Events, Media Coverage, New Features, NEWSTAR | Tagged , , | Leave a comment

Innovative yet practical land development and acquisition strategies for up and coming builders to meet the shortages and challenges of your market.

Acquiring land is the starting point for all builders, and is often a major issue. Regardless of size, land acquisition will dictate your volume of builds, the market size and demographic you can sell to, and can change the way you finance a new community development.

What The Experts Say

“Small to medium sized builders were crushed during the recent land depression in the recession, and a lot of their equity base is just gone so they don’t have the cash to close or the equity that is now required for a lender,” says Richard Guerard – Illinois attorney. Guerard’s legal expertise is in real estate transactions, he recommends that growing builders “compete with big builders by developing their own lots based on their specific strategy”.

To understand the effects on land development during the recent recession, also try – Land Pressure: Combating “Zombie Subdivisions”

Top 3 Land Acquisition Tricks for Rising Builders in 2018:

  1. Approach Land Acquisitions with Multiple Payments – Establish a purchasing schedule to buy the land gradually while selling homes to clients
  2. Band Together with Smaller Builders – Unite with other local builders and establish your presence and buying power as community members in acquiring land together in strategic locations
  3. Begin Small, then Build Up – Local builders have an advantage over giant production builders by harnessing local relationships – automate your purchasing capabilities as you focus on acquiring more land in strategic locations

 

To reap the benefits of these tips for land development, builders need a level of commitment to standardized work process. Bonus Tip:

  • Investment in Technology is an Investment Towards Success – these tips cannot be implemented with spreadsheets alone. Prospecting various land packages, and working with other local builders, requires an advanced land acquisition and development software solution.

The Verdict

Having the right strategy alone may not be sufficient enough to outpace the big players in the industry. Always look for innovative technical solutions for purchasing and land development. Our Land Development software – LandDev automates lot planning while integrating financial data with established enterprise resource management platforms. Investing in an integrated land development solution will take care of resource allocation and vendor contracts to maximize profits. Cost efficiency means you can start planning your next big land purchase for new communities!

Content Source: Land Strategies for Small Builders | Brian Croce – BuilderOnline.com

Join Us at The 5th Annual Real Estate Private Equity Forum

Increasingly, today’s market is about catering to millennials as first-time homebuyers, ensuring creative – yet cost-effective homes are tested and taking advantage of niche markets. Join our Director of Professional Services at The 5th Annual Real Estate Private Equity Forum. Bob Swainhart will cover:

  •         Innovations in homebuilding and condo products
  •          Appealing to the modern homebuyer
  •          Effective building strategies for cost savings
  •          Testing new home designs and taking advantage of niche markets

Event Details:

The 5th Annual Real estate Prive Equity Forum on Land,

Homebuilding & Condo Development (East)

April 10-11, 2018 | Four Seasons Miami, Miami, FL

Register here

Posted in Best Practices, Blog, Constellation News, Events, FAST, LandDev, NEWSTAR | Tagged , , | Leave a comment

Barcode technology powers FASTSales Option Scan and NEWSTAR Design Studio Manager.

New this year, we will be offering one-on-one demonstrations of our new products, features, and modules. From your design center to your report library, these new offerings can make a big impact on your business.

These demos are filling up fast: register today before they are gone.

 

Top 5 New Product Demo Stations 


Interactive Floor Plans. 
A multi-purpose web application for previewing structural options, creating customized floor plan layouts with typical furniture selections, as well as providing marketing-grade, dynamic and fully branded printable brochures.


[NEWSTAR] Design Studio Manager.
Guide prospective buyers through a personal, interactive option selection experience. Easily build custom scenarios to match your selling process, along with a visual presentation you will share with purchasers.


[BuildTopia] Mobile Apps for Vendors and CRM.
 The trade partner mobile app brings the functionality of the Trade Network into the field, including schedules, purchase orders, documents, and more.


[FAST] Workflow and Report Library.
 FAST Workflow delivers consistent, timely and accurate information to home buyers, internal staff, trades or suppliers at various stages of the production cycle from sales to warranty.


Conasys Homeowner Care.
 From the moment the ink dries on the contract to the day of the walkthrough and for many years down the line, the Conasys Homeowner Portal drastically enhances the home ownership experience.

 

REGISTER TODAYVIEW AGENDA

 

BONUS: informXL and DocuSign for NEWSTAR and FAST. Take a moment to sit down with our sponsors: see how these tools can be put to use in your own business to improve your processes and your customer experience.

Promotion reminder: Every dollar spent on conference registration fees is a dollar that can be applied to future software purchases. Some restrictions apply. Click here for details, or contact your account manager.

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Constellation's 2016 Customer Conference

Our 2016 Customer Conference is a two-day crash course in software and technology. Building Cities, Creating Connections brings together the two key themes of our conference: advancing your software and data crunching skills, and developing relationships that will challenge your own process to help you build bigger.

Don’t miss our Amazon.com #1 bestselling keynote speaker, Garrison Wynn, who brings over a decade of research from Gallup, Accenture, and Harvard to the study of power and authority. Join Garrison as he reveals the secret that the world’s most influential leaders and companies are hiding from you.

TOP 5 REASONS TO ATTEND

  1. Network with 200+ builders and share ideas and best practices in your user group
  2. Select from 50+ interactive software training sessions
  3. Learn about the latest product developments and future roadmaps
  4. Apply your registration fee to a new software purchase*
  5. Live one-on-one demonstrations of new products and modules

And an unofficial #6 – Chicago is a gorgeous, vibrant city! From upscale shopping on magnificent mile to sightseeing at Millennium Park, Navy Pier, or the Shedd Aquarium to the sounds of Chicago blues from the city’s jazz bars, The Windy City is a cultural gem. Centrally located inside The Loop, the JW Marriott provides the perfect base to explore this beautiful city.

 

DISCOVER MOREREGISTER TODAY

 

Please join us in thanking our sponsors, Center6 and DocuSign, who help to make this event possible. Center6 has exciting new developments for informXL, for both NEWSTAR and FAST customers. And DocuSign is now available for integration with FAST and Sales1440. Join us to see these products in a one-on-one demo.

98% of attendees love Constellation conferences! Check out the photos (below) from last year’s #TREASURES2015 Customer Conference, hosted at the beautiful Ritz-Carlton on Amelia Island, FL.

This year, we have included more software training sessions that tackle more complex topics, extended the time you have to meet with your user groups, and added one-on-one demonstrations of new products, modules and features.

Constellation’s dynamic conferences offer informative sessions for everyone – expect immediate takeaways from product updates, product roadmap, best practices and interactive training sessions. We hope that all customers have the opportunity to experience a Constellation customer conference because we are confident that you will return with ideas and skills to improve your building process.

See you in Chicago!

The Constellation Team

 

Our 2015 Customer Conference: Discovering Natural Treasures in Amelia Island, Florida.

Posted by Constellation HomeBuilder Systems on Wednesday, November 11, 2015

 

 

Posted in Builder 360, BuildTopia, DocuSign, Events, FAST, informXL, LandDev, NEWSTAR, User Conference | Tagged , , , , , , , , , , , | Comments Off