7 Key Numbers Homebuilders Must Understand

7 Key Numbers Homebuilders Must Understand

October 20th, 2014

“The response to the presentation was simply amazing. It’s obvious that the home building industry is definitely on the uptick, but still searching for viable solutions to increase revenue while exceeding the ever growing demands of clients.”

These were the words of Power Marketing’s Infusionsoft Certified Consultant, Scott Stroud, just minutes after leaving the podium at the 64th Annual New York Housing Association Convention earlier this month. “I feel Jeff and I really connected with the audience simply based on the subject matter. We both had very involved conversations with members leading up to the event and there were some really good questions bought up for discussion.”

Stroud is referring to Jeff Prager, founder of Backroom Management Services and his teammate for the event. He continued, “Of course every builder wants their business to grow, but sometimes it’s hard to follow the steps to get to the end result. We have found the best and easiest way to achieve predictable and consistent results was to focus on the numbers.”

Managing Your Home Building Business With 7 Key Numbers

1. Generating Valuable Leads

Gathering a list of potential clients is crucial to the success of any business. Most homebuilders view sourcing leads via marketing as a necessary evil, believing it’s simple luck whether these leads will convert to buyers. This antiquated attitude equivocates to throwing your marketing budget out the window!

2. Converting Leads Into Buyers

Does your sales staff view themselves as artists, able to generate sales based on their personality and skill alone? Although a seasoned sales force can produce results, consistent and predictable sales require a well-structured process. The proper mix of both is a true recipe for success!

3. Making Your Buyers Customers For Life

Many homebuilders are under the false impression that a home purchase can only be a one-time transaction. If your business holds this perspective you are truly leaving money, clients and your reputation on the table.

4. Improving Your Average Transaction Value

It’s imperative that your homebuilding business makes a profit on each transaction. Are you currently gauging your average transactions? Just like a baseball player, the more hits you earn, the higher your average climbs.

5. Proper Pricing For Profit

There is a huge difference between market price and your profit, but, with the proper perspective, both can be achieved! Why do most homebuilders misunderstand the difference between cost, mark-up and margin?

6. Controlling Your Costs

This is the true key to your business’ profitability! You can’t mange what you don’t measure. The more focus put on what you measure, the more improvement you will see in the bottom line. Learn to identify and improve your Fixed Costs and Variable Costs.

7. Putting These Numbers Together

Proper utilization of these Key Numbers not only increases your profitability, it allows you to properly gauge and accurately predict your total sales!

“Both Jeff and I have helped numerous homebuilders utilize these Key Numbers to help them sell more homes and increase their profits quickly and easily. It’s our intention to help even more home construction businesses demystify this process and realize the industry can indeed thrive.”

Scott will next appear at the Building Systems Councils Showcase 24 in Washington, DC on October 28th. The overall topic for this year’s annual event is “The Race For Market Share”. Scott’s presentation is entitled “How To Build Secure Relationships That Breed Loyalty & Brand.”

Additionally, Scott has been invited to speak at the Connecticut Manufactured Housing Association’s annual meeting to be held at Mohegan Sun in Uncasville, CT. The topic will involve getting the most out of marketing automation, including the recent success of Power Marketing’s Easy LeadLocker builder automation service.

Scott Stroud is cofounder of Selling More Homes Media as well as the host of Builder Radio’s podcast and blog. With over 30 years experience in the business of marketing, designing, selling and building homes, Scott provides enthusiastic energy and expertise to helping homebuilders realize their full profit potential.