Housing Giants - August 11, 2008 - (Page 29) Production managers have special stats to follow to make the right decisions. In the Past, amenItIes and theIr PrIces lured buyers. But in today’s market, many builders are finding that affordability and practicality trumps granite countertops and luxurious bathrooms. Tracking costs such as these directly influences money in your company’s pocket. For production managers, reports and data are critical in maximizing efficiencies and analyzing materials and labor costs. An examination and analysis of the data can help production managers learn how to become more efficient, produce products that will sell in today’s environment and learn from customer feedback. From cycle time and structural costs to third-party customer satisfaction surveys, detailed reports can provide valuable information and guidance for production managers. Steve McGee, president of consulting firm Unify International, says that many builders are reluctant to down-spec their homes because they are afraid that the buyers won’t bite. McGee recommends tracking the spec levels of the top three to five competitors in a market to see where their specs and price points are. He says it is often the builders that down-spec their homes who have greater sales. A key to getting there is by knowing the right numbers; observing and reporting on that data on a monthly basis allows production managers to create more competitive products. “In tough times like this, it is really about square footage and bedroom count. You might have to take some materials out of the house to get the price point down, and right now, it’s all about that, not so much the amenities,” says McGee. Builders must analyze not just their profit margins but every asset and liability on their balance sheets. Chuck Graham, principle of Newton Graham Consultants in Charlotte, N.C., says that builders need cost of constructIon and value engIneerIng With the housing market making a 180degree turn, many of today’s home buyers are looking for little more than affordability and maximizing their dollars. www.housInggIants.com 8.11.08.housIng gIants 29 http://www.housingzone.com/giants/article/CA6253744.html http://www.housingzone.com/article/CA6522849.html http://www.housinggiants.com
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