Nov 5 2007 7:30AM | Permalink | Email this | Comments (0) |
Blog This! using: Blogger.com | LiveJournal |

In my October 29, 2007 blog message I discussed how the effect of the market downturn is finally affecting building material manufacturers in terms of cutbacks and budget reductions. This week I want to explore these actions a little further and urge the top management of the manufacturers to evaluate their respective builder strategies.

In the past I have seen manufacturers not only cut budgets and personnel but they have totally eliminated or severely cutback their builder programs and strategies. This is a normal reaction to plummeting sales and profits during a down housing market and many manufacturers are taking this course. This is a good short term solution and, for some companies, it may be the right decision to take.

I want to encourage the manufacturer to try to look beyond the short term solution and try to focus on the longer term opportunities that are available to them. I want to suggest the following actions to the top management of the building material manufacturers as it just may help them position themselves as real winners when the market turns around.

• Review your current builder program budgets and only cut those elements that can be eliminated without completely eroding your position with the builder community.
• Identify which builders that you want to win with over the long term and I encourage you to balance your builder portfolio with public and privately-held builders and with production and custom home builders.
• Communicate to your target builders how you are coping with the current market situation and ensure them that your company will be there to support them over the long haul.
• Identify how you can assist your target builders get through the market downturn. Perhaps you can provide sales training, product installation training, special promotions, etc.

It takes a long term commitment for a manufacturer to be a leader in the homebuilding industry so I urge manufacturers not to totally abandon their builder strategies and programs during this declining market, just think it through so that you can come out on top when the market comes back.