Publisher's letter: Cut through the confusion

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Several of us at Professional Builder are traveling the country this spring, speaking at The Pro Expos presented by Pella [1]. The events are being held in 30 cities. For us, it is an invaluable opportunity to connect with builders, architects, and developers and to hear their strategies and tactics for managing through the downturn.

One of the presentations we offer in every market is: “Bootstrap Sales and Marketing for Builders,” written by our sales columnist Bob Schultz. The overall message seems to resonate: You can sell homes in any climate, even this one, but in many cases, you must reacquaint yourself and your team with the homework and preparation required to be proficient in sales.

From 1992 to 2006, selling new homes was easy. It was not a question of whether a new home would sell, but rather the price at which it would sell. In the run-up of the housing market, builders and sellers sold compelling options in order to maximize the selling price. It was a classic sellers’ market, one strong enough to make most new-home salespeople post numbers like ‘A’ players. In today’s market, the pretenders are gone. Only the best salespeople have survived. Today, that means there are a lot of builders doing their own selling. Many need to brush up on the basics, says Schultz, who was recently named a Legend in Residential Marketing by the NAHB. But first, builders must recognize that the tumult of recent years has left nearly everyone confused.

Buyers are confused because they can’t be sure that home prices have finally settled or if there is room for them to fall further. Builders are confused because the product and the pricing they previously deployed are ineffective. The entire marketplace itself is also confused because foreclosures and short sales seem to hit local areas sporadically, just as buyers seem willing to establish a new basis for price. To sell new homes today, says Schultz, you cannot afford to be confused. You’ve got to know your story, your market, your prices, and your product so well that you can consistently present your new homes with confidence and poise. In a market rife with confusion, yours must be the voice of clarity and reason. And the only way to speak with clarity and reason is do the homework, prepare an outline, hone your story, and write it down so others — your salespeople, your realtors, and other members of your team — can benefit from the clarity.

The elements of clarity, says Schultz, begins with the story of your building company. People want to know who you are, your background, and a bit of your building lore. Another element of clarity: you need to know the benefits and amenities of your location — both at the regional level and in a very local level. Then you need to list 10 features and benefits of the exterior of your homes and 10 features and benefits of the interior homes.

Does this sound too basic, even remedial? Initially, I thought so too. But traveling the country this spring, I have been surprised by the level of engagement when we make this presentation. Builders are taking notes and asking questions. But more work is required. Schultz advises builders to conduct a detailed study of the competition, including the re-sale market. This too must be written down, placed into a binder, and reviewed regularly. Good sales fundamentals can really help separate you and your team from the pack, and in the process, you may also be able to remove some of the confusion in your market.

If you’d like to receive a copy of Schultz’ presentation send me an e-mail at potoole@sgcmail.com [2].