I looked up the definition of “uniformity”… a state or condition in which everything is regular, homogeneous, or unvarying. lack of diversity or variation.
Uniformity can be found in everything we buy, sell and use. Hungry for fast food? With the exception of Taco Bell, just about every ‘quick serve restaurant’ (QSR) serves basically the same type of food to the same customers.
Looking for a new car? If you like SUVs, they are beginning to look alike. Want to be different and get a tattoo? Today getting one is not unique as tattoo parlors are as plentiful as breweries and convenience stores.
When it comes to housing, most of us want something that reflects our personality but in the end, we settle for a new single-family home that looks very similar to every other home in the neighborhood.
And if you only qualify for affordable housing, your options quickly boil down to tract houses where you get to choose from one of five styles, townhouses or condos, all of which are almost all identical to each other.
What drives this rush to uniformity? Demand!
Do you want to make more profit from your housing developments? Then simply start building the same thing over and over again because the pent-up demand for housing is showing no sign of slowing down. The cheaper and faster you can bring a project to fruition, the sooner you start making a profit.
Modular home factories and offsite component factories are caught in this same demand in supplying projects as fast as they can at the lowest profit points some of them have ever experienced, forcing them to keep things uniform when accepting new projects to build.
New modular and component factories are embracing robotics and automation which work best when doing repetitive assemblies. They are taking their cue from the automobile industry.
As long as demand is strong, the automated factories work profitably but if demand slows down due to a recession or a housing crash, these factories still have to pay for the robotics and automated tables even while cutting labor costs.
Capacity is still the one thing that hinders the modular and offsite construction industries’ growth. Do they build new factories today in hopes that demand continues for the next decade or do they continue to ‘wait and see’ what is going to happen tomorrow?
There is one segment of the modular and offsite construction industry that continues to build without those 18+ month lead times and makes a much better profit than those production-oriented factories.
Custom home construction, both offsite and onsite, is still a strong market and with fewer players, many factories are starting to realize they are holding winning hands. Higher profit margins and quality are the Aces up their sleeves.
If you own a modular custom home factory and are still working on the traditionally low profits of yesterday, you really need to do some homework and decide if you want to continue competing for nickels and dimes with the bigger production factories or do you want to raise your prices, do the higher profit custom work inhouse, have a smaller more manageable backlog, increase quality and have happy builders and new home customers.
Demand breeds uniformity and that brings lower profits and sometimes quality and lead times suffer. If that’s what you built your modular factory around, please continue.
But if your factory is an established factory that has a reputation for custom workmanship, you really need to look at capitalizing on supplying the other end of that demand market…custom homes for the customer that doesn’t want a cookie-cutter home and can afford it.
That is the niche market our industry can fill.
Related Articles:
- Custom Modular Housing Is Alive And Doing Quite Well
- Anything Is Possible In A Custom Modular Home
- Refilling The Dwindling Ranks Of Custom Modular Home Builders Is A Must
Gary Fleisher is the Editor in Chief of the Modular Home Source. Email at [email protected]
