Our Mastermind Group goes on the road once a year, to visit one of our builders who can showcase sales and marketing at the highest level. Jason and his team didn’t disappoint. We visited their famous coffee shop sales office, carefully curated model centers and OYL welcome center. We were given an in depth overview of systems and processes from innovative founder Will Herring, plus visited their unique and colorful firetruck, which they use for hosting memorable on site events in communities and local parades. The highlight for most of us was their four stunning homes that were built in real time on HGTV’s “Rock The Block” and had literally been completed the week before. We all felt like we were enjoying a “new home nerd brush with fame”.
We enjoyed gourmet lunch and dinner and appreciated the opportunity for sincere connection and friendship within our new home sales community. On day two we collaborated in an unparalleled opportunity to learn from each other, with many hours of Round Table discussions. Here are three of the topics and what we learned from each other.
#1 – Motivation or Money
One of the most revelational conversations that occurred was regarding the topic of how to keep your sales team motivated with some of the challenges that have been occurring during this new home sales market, such as sales pauses, price increases and delays.
Beth Byrd, Director of Sales at Beacon Homes based in Edmund Oklahoma, shared that she discovered her salespeople were literally most stressed over money and how to stay afloat during these uneven selling times. They had huge backlogs but were ironically anxious over their own cash flow. Beth met with them and offered them one of two new compensation packages, one with higher commission and lower base, and one that was flipped. They chose the one that suited them, are still selling effectively but they are now much happier and more motivated to succeed, knowing their company cared enough to address their financial needs. Terri Smith Sales Director at Bosgraaf Homes in West Michigan concurred and rolled out three new commission plans for her high performing team. Her salespeople chose the plan hey were most comfortable with and are now still performing sales at a high conversion rate, but without the anxiety over cash flow and access to their earnings. In my decades of sales and management experience draws against backlog was always considered very normal, and offered proactively with written perimeters with commission plans in the absence of a salary.
Mastermind Conclusion:
Feedback from the experts in the field was before you go and spend big money on motivational programs, simply talk with your sales people, find out their pain points and then present financial solutions that reward success and are aligned with your companies goals. Stress relieved and motivation restored.
#2 Price Increase and Move in ready Homes
Given the housing market conditions in April 2022, we spent a great deal of time discussing how to communicate delays and deal with price increases.
• A few of the Masterminds still handle presales but with an escalation clause, which I suggest calling a “Price Cap Guaranty”. These vary anywhere from 3% to 10% depending upon the region and market.
• Others build move in ready homes and put them on the market anywhere from framing to cabinets, feeling safer about locking in the pricing at that time.
All of the Masterminds expressed that their sales team aren’t happy with this uneven approach to selling and they have issues staying focused without homes to sell. Chad Murdock, manager at Hunter Quinn calls this “an existential crisis” for himself and his team.
Jenna Parker, Director of Sales at Steven Fine Home in Wilmington, NC and her team shared their creative solution. CFO Regan Dumas studied six months of sales and price increases and was able to come up with a formula for predicting average monthly price increases. Now Jenna’s team are able to list homes at slab and plug in the higher number up front and sell homes with an “even flow sales” approach. They are selling at capacity, buyers and sales people are happy, and bottom line profits are being protected, a true win-win-win.
Mastermind Conclusion:
Estimate a reasonable price increase formula based upon recent data and put your homes on the market with a realistic price buffer to protect the companies’ profits. Sell at capacity and create happy loyal clients and salespeople.
#3 Realtors ®, “Love them or Leave them?”
We all understand the fickle nature of Builder relationships with Realtors®. When sales are slow we do everything within our power to cultivate Realtor® relationships and ensure that they bring much needed qualified clients, when sales are booming they may be deemed surplus to requirements. With this booming market and the onset of more effective digital marketing, as well as the impact of trained OSC’s; Realtors ® in many markets are becoming much less needed and considered an expensive cost of sale. Many builders have either drastically reduced commissions or in some cases removed outside Realtor® commissions altogether. The consensus amongst the Masterminds was that Realtors® are still important to homebuilders, and there will be a time soon when we need those extra sales again. Lisa Licata, Director of Sales and Marketing and Broker at Sterling Homes in New York, shared that her team is using this time to help educate Realtors® how to work with builders. The group agreed that while supply of homes is low and Realtors® are grateful to builders to have homes to sell, that education is the key area to focus on.
Mastermind Conclusion:
Yes we still love Realtors®, use this time for Realtor® outreach to focus on education and nurturing key Realtor® relationships.
Anewgo Demonstration and Q & A
Also we were honored that John Lee and Sara Williams from Anewgo (formerly Rendering House), presented what they can accomplish with the latest technology in the new home market place. From:
• Renderings?
State of the art renderings completed quickly and at great value, even adding staging and real furniture that could be brought directly on line from trade partners.
• AI
Artificial Intelligence that delivers far more qualified leads to builders than ever before, providing ethical intel that motivated sales people and OSC’s can use to connect and close far more effectively.
• Buy Now
Lastly John and Sara showcased the simplicity and efficacy of their BUY NOW button and process. Our Sales and Marketing Directors learned so much and many were in the que to learn more from John and Sara’s after the event.
Finally thanks to our other sponsors Clear Evaluations and Melinda and Brody and company, both excellent Video Shopping companies.
JOIN US:
The Management Mastermind Group is an active group of Sales and Marketing Directors and Builders from all over North America. We meet Via Zoom three times a year to discuss the latest trends systems and processes, share ideas in live time every week, meet at IBS for our own exclusive party, and then once a year meet at on of our Builders to view their sales experience, dine, have fun, and share the latest best practices.
We would love for YOU to join us. So please contact me, and I will be happy to answer your questions and help you join this exclusive group of your industry peers.
Gratitude
Lastly, I would like to thank Abi Licatino for all she does for both the Mastermind Group and all of our clients at New Home Sales Plus. She works tirelessly behind the scenes to ensure that every single program runs smoothly. Abi was in Charleston early and had already handled the hotel, restaurants, bus booking and IT, all with grace and enthusiasm. I am blessed to work with Abi and couldn’t do what we do so seamlessly without her.
Happy Selling,
Roland Nairnsey
President, New Home Sales Plus
Roland@newhomesalesplus.com;