Trouble finding quality trades? Keeping them? Here’s how scheduling & process can improve your collaboration with trades and suppliers.

Working with trades and suppliers can be challenging. Across the country, trade shortages are making it difficult to find and retain good people. From lack of communication in the field all the way to scheduling issues, we consistently hear that builders find it difficult to integrate trades into their business process.  Here are 5 keys to effective trade management.

People & Culture Matter – Think about your trade base as an extension to your builder family. it’s important to compare the cost of labor from your contractors – it’s just as important to nurture those relationships by committing with them over the span of several project. This establishes trust with contractors and lets them know they can depend on you for a fair working standard. Building trust and controlling your trade base could mean a better negotiation stance when contracting trades that could also save you money.

Strengthen Your Company Framework – Establish a strong supply chain for building resources, this is a defining factor that determines how desirable you are as a partner to work with. News travels fast, trade commitment goes hand in hand with a builders’ internal structure and how steady their operations are. Making sure you have a steady supply chain makes you an attractive employer for trades as they can count on you for future work. Since trade professionals are a scarcity, so is their time. You can bet your trades base is constantly checking on whether their investment in time to the revenue generated for the work complete is even worth it.

Establish a Standardized Scheduling Process – High volume production builders implement a co-dependent scheduling process with a “payment upon completion” system with their trades. A walk-through process upon each task should be incorporated into the build schedule, once all issues are resolved, the contractor receives their exact payment 2 days later. With co-dependent tasks accounted for in your work flows with fast payment implemented, you are ensuring a home is built in a logical order and that your trades complete the job on time with quality. For example, if your frame is set to go up by vendor A, then the schedule for vendor B, who oversees roofing should be dependent on vendor A’s schedule. At the end of it all, automated payments incentivize your trade base for collaboration with you and with each other while respecting your set schedule.

Technology and company goals should be complimentary – Give your trades enough trust and the right process to get the job done on time but ensure an efficient work load for each partner by delegating tasks they excel in. Always maintain control over the schedule. It is a common issue where trades do not commit to the established plan and other trade tasks get pushed back, this can cost you as late-extras occur when tasks are not completed in a defined order. We recommend a fixed scheduling software solution that works by “leader tasks”. This ensures that during the rare times of schedule shifts co-dependent trade tasks shift accordingly. Having technology in place that sets clear measurable goals from your trades means you are in control of your production standards.

Collaboration Through Enhanced Communication – Knowing your trades on a personal level means they are more likely to keep you updated on all tasks. Implement company-wide trades meetings to boost morale, while in the field, schedule timely check-ins with trades that don’t interfere into their work but enhance their incentive for quality work. It’s truly a balancing act. Having something simple like a mobile application for your trade partner to use will translate into effective communication. Constellation HomeBuilder Systems’ vendor application is the VendorGo App, the app combines the trade and builder data into a single account and functions freely from any job site.

The Verdict 

Healthy trade relations will strengthen your building backbone. From higher quality craftsmanship to lower labor costs, a builder needs treat trade partners as part of the company. Set up technology that enforces company expectations and nurtures the right culture to attract committed trades. To keep that relationship strong for future projects, collaboration should be encouraged by having the right scheduling work flow that is supported by effective technology from the heart of the job-site. During times of labor shortages, a lack of order and collaboration amongst your trade base could mean the next builder in town will land your contractors for their projects.

See how national production builder, DSLD Homes enhances trade collaboration with the right scheduling technology http://bit.ly/2Je5Ygk

Sources:

http://www.builderonline.com/money/two-builders-strive-for-greatness_o

http://www.builderonline.com/money/how-to-offset-increases-in-your-biggest-costs_o

 

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The 2018 Builder 100 List: How the 10 fastest-growing public builders found success after “The Great Recession”

Recent findings show we are close to reaching the all-time high in the home building industry in terms of the number of homes sold when comparing the numbers from a decade ago, before “The Great Recession”. In 2007, we had a record high in home closings of 389,902 units in comparison to 2017 with 326,984.

The numbers are a sure sign of a healthy growth year over year, especially after one of the worst market crashes since the great depression. We have explored the past decade in providing hundreds of home builders with mission-critical integrated software solutions.

We found that many of the Top 10 fastest growing public companies listed on the Top Builder 100 list not only leveraged Constellation’s software but also shared a common theme when it comes to business operations during recession recovery.

They Doubled Down on Resources in a Down Market

As company growth stalls, builders invested back into their communities to produce more homes and tried to be mindful of their bidding strategies. As the recession hit the housing market, so did all other resource assets related to infrastructure. Builders tightened up their budgets and running costs to invest in the long term. Although this has not been a complete comeback, 2017 did see higher revenues in the homes sold to due to a rise in the average home price as demand is also rising and home builders were more willing to innovate with their products for higher margins. Last year saw $133 billion in revenue versus $123 billion from 2007.

Managing a Tight Market with Automation & Innovation

With limited internal support, growing builders turned to cost-cutting strategies that streamline processes on the job site, that eliminated manual work in the back office, and provided insightful reports for better decision making – this became a necessity for every real estate investment after the recession. Many growing builders stayed afloat by spending less time administrating tasks and more time on strategy. They also leveraged software at any given opportunity, time became of the essence in investing in real-estate. Builders waited for key pockets of metropolitan neighborhoods close to a bigger builder’s community to ensure buyers would come. Builders constantly assessed and reassessed plots of land, they integrated accounting into all their business functions for increased financial analytics, scheduling became the law of these firms as any building errors were simply too much to pay for.

Simultaneously, as precision home building became more and more automated, design center upgrades became a trend. New homeowners wanted personalization from production home builders. With integrated décor centers, home builders were able to offer up “premium” finishes to home interiors that improved margins without sacrificing too much building time. Some builders have even integrated their contract addendums to their homeowner’s selections for real-time data on profits and capital costs of each home.

Also try, “Top 5 Builder Tips for Efficient Décor Centers to Drive ROI” for improved design center appointments.

Rebuilding Teams with Goals and Effective Processes in Mind

As the housing downturn affected where people worked, home builders carefully restructured their companies with key talent that understood the company’s deliverables and goals. Key members were usually sales driven and understood the necessity of streamlined processes. This new generation of builders figured out that the old way of building needed to change as new technical solutions became available, with data and metrics injected into the workplace culture of building companies. Accountability to achieve financial success was heightened, while streamlined process left more time for home product innovation.

The Verdict

The fastest-growing public home builders today are where they are because they believed in their trade. During the recession, they doubled down where they saw fit and planned for future developments. They invested in automation technology and best practices that became cost-effective ways of completing the same task with less effort. They also innovated but did so in accordance with what they can afford by measuring, tracking, and budgeting. Overall, home builders chose to innovate and offer better homes than before by rebuilding their company culture around goal setting and improved workflows.

The Housing Leadership Summit

At this year’s Housing Leadership Summit, we are proud to be supporting Hanley Wood and “Top 200” builders as a gold event sponsor. We are happy to announce that builders can now anticipate and maximize productivity with the latest advanced home building technology. From artificial intelligence to the design studio, access real-time business predictions so you can focus on improving all aspects of your work processes. We look forward to meeting all top thinking builders at this year’s event.

Source

“The Great Recession: Builders Look Back” by Jennifer Goodman | Builderonline.com

“The 10 Fastest-Growing Public Builders” by Hanley Wood Data Studio, Charlotte O’Malley | Builderonline.com

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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

Challenges and opportunities for builders and developers in the state of Texas – where technology stands in North America’s biggest housing market

The Texas Opportunity

Six of the top 10 most desirable cities for homeowners are in the great state of Texas. These cities have growing home values, growing population, and shrinking unemployment and crime rates. Houston, for instance, is the 4th largest city in the United States and is a dynamic, growing city, rich in culture and diversity – and the home of our next Smart Strategies for Builders Seminar Series.

Here are some of the unique challenges affecting Texas builders and developers:

Challenges and Opportunities for Texas Builders in 2018

Demand for new homes is high while labor is hard to find – Demand is high, which means Texas home builders can expect higher margins as homeowners are willing to outbid their neighbors, but this too comes at a cost since skilled tradespeople are now a hot commodity. Add in the effects of Hurricane Harvey, which has pitched homebuilders against renovators in the competition for skilled labor.

The opportunity: be the builder that trades WANT to work with. Communicate more effectively with your trade partners, establishing a culture of trust and accountability. Pay trades immediately upon completion of work. Make it easy for trades to schedule their time – by offering real-time schedules on their mobile AND notifications in their inbox when important changes affect their timeline. Keep job sites clean – the trades have to work there all day!

The Texas market is getting crowded – The price tags on homes are increasing, the population and demand are growing, and the cost of building and acquiring land is also increasing. Builders from across the country are taking notice.

For successful land acquisition strategies, try “Top 3 Secrets to Land Acquisition for Home Builders”.

The opportunity: be the builder that customers WANT to buy from. Stand out from other builders by offering clients some customization in their homes without sacrificing your workflows with automated design studios. Out-compete your competition with homeowner care platforms that track, monitor, and increase referrals by creating happy customers who will say great things about you. When demand is high, you can be certain that homeowners are considering all their builder options. Lastly, ensure you have an industry standard accounting system dedicated to builders. Efficient budgeting and financial decision making can speed up build times allowing you to scale into different local Texas markets.

How to bring it all together – In a booming yet expensive market, customers are interested in purchasing homes but how can you stay ahead by maximizing your company earnings? Bigger builders tend to focus on the bigger picture and strategy involved in choosing the right locations for new communities, how receptive homeowners are to the product, and ways they can add on to the product for a quality home. As quality lots become more expensive for builders, the price tag will increase on homes. This could have a feedback effect and increase the costs of all other resources critical to building.

The opportunity: Focus on resource procurement using accounting software that will ensure you are on a budget and on track for your established growth. But why stop there? Choose an integrated building solution for the whole package that can offer all your other departments and building functions more data that can impact your companies financial responsiveness. For example, during adverse building errors, your warranty department should have an integrated process that alerts your accountants and trades with the same information so all departments are accountable.

LIMITED TIME: Get 40 percent off the Texas Builder Panel
Use the discount code “Houston 40”, we have gathered housing market experts, a panel of big builders, and software specialists with years of experience in the building industry. This is your opportunity to thoroughly understand the Texas market and to learn about opportunities and top business strategies to meet the changing Texas market.

 

Event Details:
Rapid Growth, Hurricane Fallout, and Labor Shortages:
Navigating Your Company for Continued Success
April 19, 2018, | Houston, TX
Hotel ZAZA in Memorial City
Get Your Tickets Now

 

 

Sources

2017 Best Places to Buy a Forever Home | GoodCall.com

What Does TechLash Mean for Needed Change in Home Construction | John McManus BuilderOnline.com

 

 

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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