Where & How Do YOU Fit into this MHousing Conversation?

Where & How do YOU Fit into this MHousing Conversation?

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Feed back on last week’s blog posting….

I.

Where & How do YOU Fit into this Manufactured Housing Sales Conversation?

Over the years – no, make that decades; some reading this blog posting have collaborated with me, to address various HOW TO needs within the landlease community asset class. Some examples: the ABClassification System® replacing the defunct Woodall Star System, was an early National Communities Council (‘NCC’) project.. The do – it – yourself Valuation Calculation Worksheet or VCW, was the first non – traditional LLCommunity valuation methodology, enabling owners/operators to accurately estimate the value of their income – producing property, without paying thousands of dollars to realty appraisers oft erroneously (then) using apartment operating expense ratio data; and most recently, the popular ‘Ah Ha! & Uh Oh! Worksheet’, for estimating new and resale ‘affordable’ and ‘risky’ housing price points in any local housing market, using Area Median Income (‘AMI’) per postal zip code, or a prospective homebuyer’s Annual Gross Income (‘AGI’). See end note # 1.

Now, beside the ongoing chattel mortgage finance regulatory imbroglio (Go head, look it up) affecting – no, traumatizing, landlease community owners/operators from coast – to – coast, there’s yet another (not so new) HOW TO need on the operations horizon; namely, manufactured housing marketing and on – site sales at these properties. I recently participated in the following (edited) exchange of emails, both on LinkedIn and personally, with John Ace Underwood and Ken Rishel. Remember; these three freelance MHIndustry consultants are ‘talking shop’ about YOU…

George. “I understand better now, how your unique sales training methodology works.” A little later, “One thing gong in our favor these days, is virtually all the freelance LLCommunity consultants of the past decade are gone, with the exception of about five of us.”

John: “And that’s why we’re interested in identifying LLCommunity clients who expect us to stick around, and document results we believe we can achieve! Then, if clients are not getting the results they anticipate, we want empirical data that clearly identifies ‘why not’, so it can be effectively addressed! That’s also why I don’t believe ‘sales training events’ in general, or any dog and pony show, without follow – up, have much of a lasting impact, short or long term.”

George: “OK. With that said, how do we move forward to improve on – site home sales?

John: “It is my belief, community owners of ANY size must take home sales activity much more seriously. In the distant past, LLCommunities viewed home sales as something done by ‘someone, somewhere else’, e.g. the independent ‘street’ MHRetailers (f.k.a. ‘dealers’).” Commentary: This is where that proverbial question arises: ‘Which came first, the chicken or the egg?’ MHIndustry – specific, Was it independent ‘street’ MHRetailers shifting focus to compete, as contractors, with site – builders in the ‘big box = big bucks’ homebuilding arena; OR, LLCommunity owners starting to sell homes on – site, that motivated MHRetailers to look elsewhere (i.e. land – and – home packages) for new homes sales business? Answer? Doesn’t matter! Today, according to MHI, there’re 8,000 fewer MHRetailers than in 1998; and, now virtually every LLCommunity owner/operator MUST sell new and resale homes on – site, to fill vacant rental homesites, or those sites remain non – productive, where rent collection is concerned.

John: “From my perspective, it appears most community owners have their on – site managers and maintenance staff also handle home sales activities and service. While these people may be phenomenal professional property managers, and or service help, new and resale home ‘selling’ demands an entirely different skill set! When having to fill vacant rental homesites with new and resale homes, community owners must identify the most capable, (maybe) experienced, and certainly motivated person for the sales task at hand, using fairly strict selection criteria, aptitude testing and personal interviews; then, once they’re hired, provide home sales training, appropriate process(es), and leadership!”

John: “Regarding the 15% larger property owners/operators (i.e. Property portfolios with 20+ LLCommunities, averaging more than 200 sites apiece), they must build a sales organization focused on nothing but home sales! These operators have to understand, NO ONE will sell their communities (lifestyle) better than them. They can no longer depend on independent ‘street’ MHRetailers, or ‘gravity’, for that matter, to do this.”

George: “But here’s ‘the rub’; portfolio ‘players’ who’ve been the most successful at home sales, and some indeed have been; to date, appear to be the least willing to share Lessons Learned with their peers – probably out of fear of competition in some local housing markets. The answer? Frankly, there isn’t any. When less than 10% of the known portfolio owners/operators are direct, dues – paying members of their only national advocacy body; well, the peer pressure opportunity simply isn’t there.

John: “And in some (other) cases, LLCommunity sales managers still need to reach out to established MHRetailers, when they can be found in one’s local housing market, to at least attempt to form a mutually beneficial relationship” This might mean those properties pull back from selling (maybe) new homes on – site. “In any event, the deals are out there; they just need to be found and sold – and financed (Hence a good idea to also bring a local lending source into this home sales relationship). And even local real estate licensees can have a place in this mix IF, and I stress IF, a process is put into place to handle their unique marketing effort.”

Speaking of ‘process’. John has some pithy commentary relative to a common shortfall in this area, observed at MHRetail sales centers and on – site in LLCommunities. “We have come to realize, most MHRetailers critically lack the data with which to make meaningful changes (improvements)! Most have no idea of the amount of traffic (e.g. volume of daily phone inquiries & sales center visits), the quality of that traffic (e.g. whether ‘qualified’ or not), even the number of opportunities created from that traffic (e.g. conversion of phone calls to visits & visits to approved applications). Many times, management blames sales people for what is actually a ‘marketing issue’, and at other times, ‘the web & marketing people, for what is actually a ‘selling issue’ (e.g. inability to ‘close’). Bottom line? You can’t manage what you don’t measure – and that which you begin to measure, often begins to improve!”

And at this point Ken jumps into this heady conversation. “LLCommunities have a sales advantage over independent ‘street’ MHRetailers, that garners them greater profit on home sales transactions! Unfortunately, it’s rarely discussed anywhere, and almost never taught. The last time I heard it parsed publicly, was at a meeting of the Urban Land Institute’s Manufactured Housing Communities Council; when a ‘former LLCommunity owner’ explained why ‘such & such firm’ paid a premium to buy his former trophy properties. He said they did it to discover and learn his methods of marketing, advertising, and selling homes on – site! However, once they bought the properties, they soon decided it was ‘too much work and too complicated for their system (process)’, and abandoned his methods.”

Ken: “So, what’s this great ‘secret’? Simply, to focus on selling lifestyle and neighborhood, rather than hawking just boxes and price! That, of course, means marketing and advertising must address ‘why’ people would and should want to live in a particular landlease community; and it helps the sales effort, to incorporate current residents into the process as well. It also means sales personnel must be well selected and trained, and very good at their jobs. It’s more complicated, to be sure, than just ‘selling the box’, and certainly more expensive to market and advertise. Frankly, it requires more of everyone involved, but it works well and is certainly more profitable.”

Ken: “Del Webb used this strategy when they developed and filled landlease communities. The Villages, in Florida, still do it, as do a number of others. Think Timbercreek in Springfield, IL., and SaddleBrook in Grayslake, IL.; where the former was recently honored as MHI’s Community of the Year, at the annual MHCongress in Las Vegas, NV. And, before anyone starts opining, “That only works in ‘such & such market’”, NO, it works everywhere, and with all age communities as well as with Senior communities. And frankly, ‘the secret’ works in average properties as well as with ‘A’ grade LLCommunities, if YOU plan for, and work it! It won’t apply, of course, in a slum property, or in those where ‘raising the rent first, fast and foremost’ is the property owner/operator’s primary objective.”

So. there you have it. What three well known, veteran, freelance MHIndustry consultants are saying about YOU, on the social site internet these days. Are they right or wrong? Well, given our industry’s annual home shipment production continues to languish at a 60 year nadir – allowing for some uptick, thanks to ‘fracking’ in a few regions around the U.S., they almost ‘can’t be wrong’. But are they ‘all that right’? We’d like to know: See end note # 1 at end of this blog for contact information. In the meantime, know that Joe Ace Underwood, and his partner, Joe Wooldridge, are working on a New Home Sales Program tailored specifically for use within landlease communities, whether selling Community Series Homes (‘CSH’), or otherwise. Contact John via (239) 389-2046 or Junderw794@aol.com

End Note. 1. These three HOW TO resources FREE ‘for the asking’ by phoning the MHIndustry HOTLINE: (877) MFD-HSNG or 633-4764

Next week? Maybe, ‘The Care & Feeding of MHRetailers’, a popular seminar topic of the early 1990’s, needs to be dusted off and reintroduced to this audience. Especially to those LLCommunity owners/operators too small to launch their own dedicated home sales operation on – site, AND independent ‘street’ and ‘company store’ MHRetailers interested in filling vacant rental homesites in these properties, but haven’t made a real effort to do so since the 1990s. Hmm. Now, where did I file that lesson outline….

*****

II.

Feedback on Last Week’s Blog Posting

Relative to ‘Your Views’ in general, and my suggestion we vote political incumbents out of office en masse this coming November….

“Very well done, George. Let the Free Market and Free Enterprise System find the solutions to help consumers, while making a profit and creating jobs! Yes siree!” NB

There’s more, but lengthy in nature, so will ‘hold’ for now, and likely incorporate into a future blog posting.

*****

George Allen, CPM® & MHM®; Box # 47024, Indianapolis, IN. 46247 (317) 346-7156

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