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Manufactured Housing’s Declaration of Independence

Our focus for this column will be facts, opportunities and challenges, so if you want some 4th of July weekend inspiration, you'll find that with:

Let's press onto some eye-opening insights.

Just the Facts

> The total number of new RVs expected to be sold in 2014 is 335,000 units, which would be the highest total since 2007. · In 2013, the RV industry shipped 321,127 units (RVIA).

> Total number of autos and light truck sales in the U.S. for 2013 increased 8% year over year to some 15.6 millions units (Zacks).

>  in 2013, 428,000 new single family homes were sold (CNBC).

> Sales of existing homes are relevant to MH industry professionals too.

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CNBC reported that the average median price for homes sold in the U.S. in 2012 was $198,000. Some of the stats and the info used for the chart shown – courtesy of Statistica – naturally originated from the National Association of Realtors (NAR).

NAHB's Chairman reported that the continued surge in multi-family housing is what is pumped up the new construction past 1 million units annually; single family home-starts remains flat.

Per the NAHB, “The flat single-family data confirm our latest surveys, which show that single-family builders remain concerned that tight credit availability and uncertain economic conditions are keeping potential buyers on the sidelines,” said Kevin Kelly, chairman of the National Association of Home Builders (NAHB) and a home builder and developer from Wilmington, Del. “However, demand for apartment construction still remains high.”

What do such Facts Suggest?

When you think about the

  • cost of a new car or light truck,
  • the significantly higher cost per square foot for RVs (a luxury item) than manufactured homes (housing is a necessity),
  • the fact that we can provide a manufactured home on a lot for less total monthly than apartments,
  • that the average new manufactured home is well under the cost of resale (existing) homes,
  • and that MHs are about ½ the cost of conventional home building, per the U.S. Census Bureau,

how can we justify the fact that manufactured housing topped out in 2013 at 60,000 total new homes?

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We hear MHI tell our elected officials – quite rightly – that we've averaged some 21% of all housing starts in the past 20 years. This chart – courtesy of CalculatedRisk – should remind us that we did far, far better for the vast majority of our history than we are doing in recent years.

Room for Growth!

Sam Zell told that packed room of manufactured housing professionals in Chicago last year, “When everyone is going rightlook left."

Everyone heard, but only 200 where present and of those, how many truly got the implication of what Sam Zell said at the gut and head level?

We hear leaders in various sectors of our industry suggesting we should be happy with 10-15% growth a year. Sure, I cheer that growth over the steep decline that took us to just under 50,000 units when we bottomed out 4 years ago. But let me challenge you, your colleagues and all to think BIGGER.

The facts above suggest what is self evident. We have room for growth, lots of opportunities in a trillion dollar annual U.S. housing market.

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Don't let you or your team's light go dark,
don't get trapped in self-limiting thinking.

What has to happen?

  • We all routinely need a mind-opening experience. It is too easy to set self-limiting goals.
  • We need to rouse ourselves from the status quo, and open our eyes to the true MH potential.
  • Leaders from publicly traded companies have certain constraints they must adhere to in their projections, etc.. Association leaders will usually reflect what their executive committee members say. I get that, you should too. But the vast majority of professionals in our industry don't have such limits placed on their speech, much less on what we think or do.
  • Bottom Line, we have room for growth, lots of it.
  • Other industries invest far more in recruiting, training and motivating their team than we tend to see in manufactured housing. An apartment complex is less 'complex' to run than a manufactured home community, but we see many operations pay their people less in MHCs than their counterparts would earn in multi-family housing. This isn't just about pay, either, I've taken low paid workers and by a combination of education and motivation shown them how to way outperform their peers. They do enhanced work with great pride! For many, yes, the pay-check is needed and important, but the pride of accomplishment is what is missing for so many today.

We on staff at MHProNews are certainly NOT the only forward-thinkers in our industry. We routinely showcase pros from various aspects that touch us professionally, for the very purpose of letting people see that we can do better. Scott Roberts told us how he does it, dozens of others in their respective sectors who lead are found linked here. They can do it, so you can too.

But for the tiny group of naysayers out there, let me remind them that yours truly has personally,

  • closed as many as 15 MH sales in a month (at retail),
  • my sales center hit the top 1% in the U.S. before it was sold (and that was in a depressed market where 80% failed),

  • managed and grew bottom-line results in 7 to 17 previously struggling MHCs,
  • did remarketing on repos for lenders that generated as many as 50 sales from a single location in month, and have commendations for enhancing recovery (they were NOT homes that were given away!),
  • marketed locations that closed as many as 75 contracts (yes, during this recent and deep down turn) in a 90 day period of time.

The point is not to brag, but to say that if others can do, if a guy like me can lead others to do it, you and your team can do too!

Garbage In, Garbage Out

With a bit of gray showing above, I confess to recalling punch-card computers and programmers who said, “GIGO,” which meant garbage in, garbage out.

If we let people feed on garbage training (or no training) or self-limiting thinking, are we surprised when they produce limited results? Training is not just how to fill out forms and paper work! Training is how to engage a good credit or cash customer in a fashion they WANT to be engaged, and will WANT to buy from you once they've been treated in a professional and user friendly manner.

I've worked with and witnessed motivated pros who get good training, willing to do what it takes rather than give excuses, and who don't manipulate a 'get me done' into buying, but rather know how to show, tell and sell a home to a cash or credit qualified home buyer!

The photo of the banner below was taken by your scribe. The location actually looked GOOD. The home looked FINE. So why are they advertising for the 'get me done' customer? Don't they know that you tend to get what you ask for, so why not ask for the good credit or cash buyer to come, in ways those potential clients appreciate and will respond to favorably?

The get me done buyer will walk in the door anyway.

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So why are so many advertising for the bottom portion of the credit spectrum in the housing pie? There are more good credit customers than bad ones!  That too is self-limiting and self-defeating.

FICO Score Facts

Credit Report 101 – who created the FICO charts shown – reports that “the median FICO score which is currently 723 and has remained exactly the same many years in a row…”

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This is the percentage in the U.S. that falls into each of the FICO score brackets as shown.

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Remember, “median” and “average” are not the same, they are terms used to reflect the same data as seen from different perspectives. When you look at the range of credit scores, the average is the mid-point of the numbers, but the median reflects the actual break down of credit scores and measures that numbers' “median” (mean) point.

But however you look at the data, what we routinely see is that retailers and communities are attracting far more applicants who are in the bottom half of the nation, rather than the top half. The problem is partially a marketing and image one, but it is also a sales training and management issue too.

When we work with an industry client, we look at the local market numbers for the retailer or MH Community in question. Based on facts, we can estimate how many are moving and thus seeking a home during a typical month.

It is stunning for clients to see that in almost any market, there are many times more than enough people moving in any given month to fill all the vacancies in any MHC property, or to sell-out their inventory many times over at their retail center.

spark-plug=wikicommons-posted-masthead-blog-mhpronews-com-The Manufactured Housing Independence Day Call to Action

Success starts in the mind, and flows from proper information, proper motivation, providing the right resources and inputs to yield the desired outcome. When Best Buy takes two weeks to train someone before they talk to a customer, or when a corporate Holiday Inn takes two weeks to train someone who will work the front desk, why is it so hard for an owner or executive to see the need to invest at least a few days initially in training a new team member, even if they are 'experienced?'

Then, why do we see so many often fail to provide ongoing training? What sports franchise or college team fails to practice daily, before and during their 'season?'

Start your team daily with reading!

You must read and watch worthwhile videos, and they must too. Maybe you begin by vetting what you think will make the most sense to them, but don't limit them either! Once people get 'hooked on learning,' and hooked on performing, it is addictive!

If you aren't on our twice weekly email list, and all your staff aren't too, sign up free in seconds at MHProNews.com/subscribe

Last month we experienced a record 2 million page views here on MHProNews.com. The 9 month average from through April was 1.25 million page views. We hit 1.5 million in May, before this new June record. We're seeing some 5000 visitors like you daily, about 8 page views average per visitor. That's exciting, but it is also still just scratching the surface of what we as owners, executives, managers, professionals or collectively as an industry that we can do.

Feed the Mind! Invest in your people and challenge your team! Get involved at your association. If there is apathy in your organization, do what you can to be the spark plug.

Manufactured home sales are recovering. Factory-built homes are the future of U.S. housing.

But it may well be an outsider, a new comer that comes in and rocks your MH world to wake some up. It may take another wake up call to rouse those who settle for serving only the poor or damaged credit customer (they deserve a nice home they can afford too, but let's not build our business models on damaged credit buyers).

If you are a seasoned pro, you ought to have the advantage! But you also have to be willing to do what Zig Ziglar called, the “Check up from the Neck Up!” Our readers and writers give me that check up from the neck up routinely. My thinking evolves in working with clients and readers, for which I'm truly grateful. So I'm not giving advice I'm unwilling to take myself.

Closing Time…

Let's close on a few notes. Let's highlight Dennis Hill this month, because there is a man with a tremendous history of success. But when faced with the cancellation of the Louisville Show in 2010, Dennis was willing to reinvent part of their marketing and event planning in order to make the show's come-back in 2011 a success. Everyone in the mix made a difference, it is never about ONE person alone, as Dennis himself says.

But Dennis is an inspiring role model for me and all of us. Dennis Hill's video interview is linked here.

A Cup (err glass) of Beer with...Barry Cole, is off to a strong start. No wonder! Like Ken Haynes fine article, Drawn Quarters, both have a download that is literally historic, and points out something that MMHF Chairman Ron Thomas Sr. talked about in his video.

All of those above, the Jim Clayton interview and more remind us how we used to sell more homes, how we got there, and thus suggest one of the possible ways how we can do it again today and in the future.

All of our July articles are linked here, and a new Industry in Focus report on financing is linked here.

Please. Declare YOUR independence from self-limiting thoughts, words and deeds. Reading and viewing are a start, but then commit to implementing the deeds. Don't be afraid to stretch. Don't be afraid to fail and fail, because initial failures often lead to successes. Who says? MH Billionaire Jim Clayton.

The irony of a declaration of independence is that we need and must depend on each other.

The founders didn't fight a bunch of solo battles! They worked together for the common good. They never got everyone to join in, that isn't human nature. We only need 'enough,' and those who 'get it' and are motivated to 'do it' to make the change.

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We are open to reader thoughts on this subject, of course. We'll share thoughts – beyond the information and inspiration and innovation – that is needed, in the days ahead.

We are growing, we are advancing, but let's not limit ourselves to settling for crumbs when the trillion dollar housing industry is waiting for manufactured housing to wake up and take charge! Happy 4th. ##

(Image credits as shown on each image file name, including FlickrCreativeCommons, WikiCommons and MHProNews.)

L. A. "Tony" KovachL. A. 'Tony' Kovach ManufacturedHomeLivingNews.com | MHProNews.com | Business and Public Marketing & Ads: B2B | B2C Websites, Contract Marketing & Sales Training, Consulting, Speaking: MHC-MD.com | LATonyKovach.com | Office 863-213-4090 Connect on LinkedIN: http://www.linkedin.com/in/latonykovach 

L.A. 'Tony' Kovach, MHM - Publisher, Marketing Director and Industry Consultant
http://www.linkedin.com/in/latonykovach
Manufactured Home Marketing Sales Management trade journal
www.MHMarketingSalesManagement.com aka MHMSM.com aka MHProNews.com
tony@mhmsm.com
863-213-4090