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Design / Build Forum

Design / Build Forum. April 23, 2003. Agenda. Design / Build approach Q and A ….lunch Design / Build sales presentation Production / Estimating insights Q & A. Remodeling Business Growth. Why Grow?. $ $ $ ? Market? YOU?. Stabilize Business/Reduce Risk.

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Design / Build Forum

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  1. Design / Build Forum April 23, 2003

  2. Agenda • Design / Build approach • Q and A ….lunch • Design / Build sales presentation • Production / Estimating insights • Q & A

  3. Remodeling Business Growth

  4. Why Grow? • $ $ $ ? • Market? • YOU?

  5. Stabilize Business/Reduce Risk New Construction Peaks Major Remodeling Specialties (Kit/Bath) Handyman Stable Economy Valleys

  6. Understanding Design/Build Design (Arch/Design firm) Build (general contractor) CASE B D • Way to get construction projects • Design is a service • Low level design • Bid projects too • Revenue opportunity • Build is a service • 30% gets built • As economy changes tend to drift out of construction • Total package • A to Z process • Offense/Defense • 95+ % gets built • Only build what we design

  7. Remodeling Segmentation General Contracting (Neg. Bid) Large Project Contracted Sales Contracted Sales D/B Process Large D/B Process T&M $0 - $800 $70k – $350k $650k  $800 - $20k $20k - $70k $350k - $650k • chs • chs • chs • cdr • ??? • ???

  8. How is the HM Business Different From Traditional – D/B Home Remodeling Trad. Remodeling Handyman Project base Slow growth Simple systems Highly seasonal Highly influenced by economy Mat / sub intensive Lower overhead vs. Client base vs. Fast growth vs. Complex systems vs. Less seasonal effect vs. Less influenced by economy vs. Labor intensive vs. Higher overhead

  9. Needed maintenance / repairs Wanted to increase the value of the home Wanted to make home more modern looking Wanted to add more amenities to home Like to do things in/around the house Needed more space Insurance repair To incorporate new technology Other Change in lifestyle Needed accommodate elderly / handicapped Percent of Respondents Source: NAHB Remodelers Council The Most Important Reasons for Undertaking Remodeling Projects During the Last 2 Years

  10. Remodeling Opportunities Build a New Home Major Remodeling Kit/Bath Renovation Specialty (D & W, Etc.) Landscaping Mechanical Maintenance/Repair Minor Decorating 0 20 40 60 80 100 Percentage of Homeowners

  11. Who is the Competition? • Small Architectural / K and B Firms • Traditional Remodeling Firms • Design / Build Practices • Homeowners

  12. Initial onsite meeting Construction Lead Construction Contract 1 Step Initial onsite meeting Contract documents Construction Lead Construction Contract 2 Step Initial onsite meeting Preliminary Agreement Contract documents Construction Lead Construction Contract 3 Step 1 Step / 2 Step / 3 Step Process

  13. Case Design/Build History • 1961 Case Construction Company • 1975-1979 D/B Evolution (market driven) • 1979 D/B step 1 process • 1980 D/B step 2 process (500k) • 1982 D/B step 3 process (1 mil) • 1982-1988 Won 30 +/- awards • 1988 8 million +/- D/B • 1992 6 million +/- D/B (HM launched) • 1997 7 million +/- D/B (K/B launched) • 2000 8 million +/- D/B • 2002 10 million +/- D/B (PA not credited) • 2003 11 million +/- (Projected)

  14. 4% 6% 13% 13% 43% 25% 33% 65% 54% 44% 1997 1998 1999 HM D/B Kit/Bath Rest. 21% 17% 23% 46% 45% 49% 34% 33% 32% 2001 2002 2000 Sales Blend by Division

  15. 1997 to 2002 Sales Overall 2002 Goal: $28.9 Mil Overall 2002 Actual: $30.8 Mil

  16. CHAIRMAN MARKETINGPUBLIC REL. CORPORATE SALES HUMAN RESOURCES Case Organizational Structure FUTURE DIV. PRESIDENT HANDYMAN DIVISION D/B MD DIV D/B VA DIV BATHDIV. KIT DIV. FRANCH DIV. PRODUCTION FINANCE ADMIN. DISTRIBUTION/FIELD SUPPORT R & D TECHNOLOGY ESTIMATING / JOB COSTING

  17. CONSTRUCTION • DESIGN/BUILD • Permits • In-house carpentry crews • Weekly meetings • Thorough dust protection • Draw Schedule • BATH/KITCHEN • Replace and install fixtures • Cabinets • HANDYMAN • Complete project DESIGN/BUILD • Detailed Planning • Refine design • Selection/ • Specification • Detailed construction plans • Preliminary Design/scope • Draw existing house plans • New Plans • Estimate • Scheduling • Ordering materials • Getting permits • Wish List • Dreams • Repairs • More Space • Small Projects • Initial Discussion • Project Description • Needs Assessment • Your Ideas • Budget • Timing • Case Process • Pre-construction walk-thru • Review plans on site • Discuss logistics • Detailed project costing KITCHEN PROGRAM • Scheduling • Assemble/order materials • Create detailed flow chart • Selection/finishes • Computerized proposal/ costing • Doing It Right • Solution oriented • Efficient • Experience BATH PROGRAM • Scheduling • Assemble/order materials • Create detailed flow chart • Selection/finishes • Computerized proposal/costing • FOLLOW-UP • Warranty • Final walk-thru • Client Satisfaction survey • Preferred client program • Call-backs HANDYMAN • Schedule work • Order materials • Review ideas • Review options • ON TIME, ON BUDGET • Complete project How We Do It

  18. Marketing Case • Focus on creating client base through HM HM ? ? D/B K/B

  19. Over 1000 years of remod. exp. Multiple divisions under one roof Local client base of over 37K Leader in consumer & industry media National Business Partners CASE Leader in tech. (E-news, e-mail, CJES, CISS, tech team) National & Local Alliances Acknowledged with 70 awards for excellence The Case Difference

  20. N A M B D E L C F K J G I H A - Preliminary Design H - Drywall stage I - Cabinet setting B - Detailed planning/selection J - Trim C - Costing options/contract K - Final hook-ups D - Lead time E - Demolition L - Punch list F - Mechanical rough-in M - Completion N - Follow-up (6 months) G - Inspections HOMEOWNER EMOTIONAL ROLLER COASTER

  21. Comparing Remodeling Sales Disciplines

  22. Motivating Managing Recruiting Orientation Interviewing Pre-Start Training The People Process…The Investment $$$ Manage & Motivate & Grow Your Investment $$$ What is your ROI?

  23. Design/Build Metrics • D/B average initial visit/meeting 1.5 to 2.5 hrs • D/B GP 38% to 42% • D/B sales person • 700 – 1 mil – min • 1 – 1.5 mil – average • 1.5 – 2.5 – all star • 2.5 – superstar • D/B carpenter ( lead ) • Sales ( 500 to 750k ) • GP $ ( 150 to 250k ) • D/B PM • 1 – 2 million sales • GP $ ( 600 to 900k ) • 4 – 6 lead carpenters • 6 – 8 projects under construction • Previous/Personal referral primary lead source

  24. Design/Build Metrics (cont.) • D/B Close rates • 10% to 15% lead to contract • 75% to 85% lead to appointments • 60% to 75% PA to contract • 95% to 98% CD to contract • D/B Marketing $ • 3% to 6% nationwide • 1.5% to 2.5% Case D/R • Average size projects • 125k to 200k • Leads per sales person • 2 to 3 per week

  25. Key Indicators to Track • Pipeline ( 6-10/3-5/1-3/1-2) • Initial call process (20-30 min) • Sales (Projected vs. Actual) • GP % and $’s ( pd and pm ) • Lead times ( l to a 7-14 ,pa to cd 15 to 30 , cd to const. 30 to 60, const. to start 50 to 80 days ) • Sub/Materials/Labor blend

  26. Case Design/Build Language • 2 step – CD (or PA) to construction contract • 3 step – PA to CD to construction contract • PA – preliminary agreement • CD – contract documents agreement • Pre Con – pre construction walk through • PD – project designer ….” a “ = asst. • POC – % of completion • CDR – Case Design/Remodeling

  27. Design/Build Insights • Sell process not solutions • Market (client) driven not opportunity driven • Design/ Production joint/ transition is where you lose $ • Player coach transition tough • Master presentation book • Control process not it control you • Quarterly cycles better indicator then monthly • Draw schedule structure important

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