What does it mean to run an efficient successful new home business? There are so many pieces to the puzzle, it’s easy to become overwhelmed when you think about how much there is to do. I like to advise my clients to first understand what your skill set is, and then identify what areas you may need help in.
As builders, you know how to build homes and you build them quite well. In the back of your mind though is that yearning desire to grow your business from say, 5 homes a year to 25. How do you get there though? You don’t know where to start – are you a design and construct builder, a custom home builder, or are standard homes more your style?
There are a few qualifying questions that you need to ask yourself first:
- What type of builder do I want to be?
- How many homes do I want to build per year?
- How am I going to do it, and what type of team do I need to support me?
Let’s start with the type of builder. This is important because that is going to be the foundation for how you set your business up, both from a sales and marketing perspective and even your product. Decide on whether you want quick and easy builds, cookie cutter jobs or detailed custom builds. The easiest way to decide is by understanding and answering the following:
- Do you want low margins and fast cashflow
- Or high margins and slow cashflow
Now let’s consider Strategy. When you break it down, a Strategy is just detailed plan. When I’m formulating strategies with my Builders, I use headings like:
- Aim and purpose
- Current situation
- Costs
- Action / execution
- Timeframes
The best advice I can give you is to document what you want to do and how you are going to do it, and then follow this plan. It may change along the way as your business grows, but it will serve as a useful reference point to make sure you’re on track to meet you growth goals.
Now let’s look at your team. In the beginning it is likely that you will have to wear many hats. As a small business owner, you’ll probably be the sales person, Estimator, Operations Manager and Site Supervisor. When you get to the point where you’re ready to expand your team, which is the best role to hire first? Consider this; if you a good builder then you do not need a Supervisor, and if you can build chances are you can estimate, so I would advise you to hire a Salesperson. Sometimes a business owner will want to not hire someone in order to save money, but this can be false economy. Consider this how much will it cost you if you don’t hire someone in terms of the opportunities you will miss.
When considering a strategic growth plan for your new homes business and wanting to build upon what you already have achieved, break it down in sections. What type of building company you want to be, what you want to build and how many, and how are you going to do it are all very important questions you will need to ask yourself. Consider having a team around you that has the same passion and drive you do, and make sure you have a documented plan that you consistently reference and update.