I get a ton of emails every week, so it never surprises me when I get one from an Architect. Most want to take me to task for calling their latest designs “just a Lego box” but today I received one from an Architect that actually understands my point of view. I was so impressed with his writing style that I have asked him to become a regular contributor to Modular Home Builder blog.
With his permission, here is the email he sent me this morning:
Modcoach,
When reading some of your recent posts about Blu Homes I noticed in the comments that
there were several instances where commenters wondered why Blu Homeswould be making
these boxy modern style homes when there is so much wider appeal for the common
traditional styles. I have a lot of thoughts about that, and I wonder if they
might alter your understanding of their position.
First off, they are not the only ones doing this, and certainly they are not
doing it as successfully as others that are. For example:Resolution for Architecture out of NY has been marketing modular built but
custom designed houses which are selling at a very high end elite level. An
example recently published on the Jetson Green blog.
While they have made an extensive study of prototypes for different
combinations of standard modules, the bulk of their built work is highly
customized. This is significant because they are working in a market that has
typically not been served by modular builders.
Hive Modular from Minnesota also has a good track record of delivering projects
in the Mid West.
And Wee House is also another brand that has consistently sold houses in the
mid west:
Now none of these companies actually own a factory, and they sub-contract
fabrication out to established builders. They develop the designs, removing
that cost from the factory and transferring it directly to the buyer. This is
significant because this is a new business model for the modular industry,
where “designed” brands market and sell, and bring work to factories.
Rather than builders selling from a portfolio of standard designs offered by
the factory.
The market for these boxy modern homes is clearly limited. But it’s also
clearly under-served. Very few modular factories have contemporary designs in
their portfolios, and site builders rarely make offerings in this style. It
makes sense for a niche market to emerge around this underserved market. And it
makes sense for it to emerge in the modular industry where a factory can serve
a wider region than a local site builder. A factory’s reach can enable them to
serve a widely dispersed demand in a way that is impossible for a local site
builder. In this way the narrow interest in “Green” building is very
similar to the narrow interest in modern homes.
What does this tell us about Blu Homes? Well what would be the compelling
offering by Blu Homes if their designs were consistent with the vast majority
of modular builders?
The fact that their houses fold? Who would pay the high
premium that they charge for this folding, and what value does it provide the
buyer? Few and none. So it makes complete sense that Blu Homes is directing
their effort towards these niche markets that are widely underserved. They have
no compelling value statement if they instead compete with house styles that
are essentially a commodity.
The interesting question that comes out of this is not why these small vendors
try to sell modern, but rather why the other factories ignore it. Even if the
percentage of people that would buy a modern house is small, why would you not
sell a house to that customer? The cost of adding a few modern designs to a
company portfolio is very low. Technical development can be differed until
there is a sale. Even if for a given factory it was only 1 more house per year
– why would you not sell that house?
Greg
—
Gregory La Vardera
Gregory La Vardera Architect
