9 traits of sales-driven home builders

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Even in this economy, there are builders in all markets producing good numbers. Management and sales expert Bob Schultz sheds some light on their secret to success. It includes having owner buy-in and learning to sell at a high conversion rate.

November 25, 2010

The national media declares that the housing market for new homes is all but dead. The concept of the American dream of homeownership is even under attack. Yet, there are still builders and sales organizations in all markets that are selling brand new homes and producing good numbers. What’s the secret? 

As a result of my experience successfully navigating through housing recessions of the mid-1970s and ’80s, I guarantee you that there are no secrets, silver bullets, or quick fixes. There is a lot of chatter about social networking, motivating salespeople, and a variety of other interesting-sounding, quick-fix tactics being thrown around. Regrettably, these are all diversions from the fundamentals of what the successful organizations are doing. Everything old is new again, and what was learned and the skills that were honed during previous bad housing markets should form the foundation for present day activities.  

Working with sales organizations from India to Australia and all across North America, I assure you that the required fundamentals and essentials are the same worldwide. Here’s a list of some of the mindsets and actions of these sales producing companies.  

1. They constantly ask themselves: Doing what we’re doing, the way we are presently doing it, how many sales are we missing, and how much money are we wasting?

2. They realize that no market ever goes to zero, and they declare what percent of the market share they will take.

3. They learn, practice, drill, and rehearse their sales presentations so that they are prepared to sell to the prospects that do show up, at high conversion rates. It’s a huge waste of money to drive more traffic if the sales process is flawed or nonexistent. Or, more simply stated: spending a lot of money to give salespeople more chances to fail.

4. They don’t worry about things they can’t control and dramatically improve the things they can control. For example, they can’t control the economy, but they can control their customers’ perception of the economy.

5. They work every day to increase sales revenue while decreasing unnecessary costs — everything from sales compensation being targeted to levels of profitability to marketing expenditures measured daily for results to cutting wasteful construction costs.

6. They are willing to be unreasonable. This means that they do not make or accept excuses. For example, they realize they’re in the retail business and must be open for the convenience of the customer, not the company. They set high standards for performance, require constant and correct role playing, and use mystery video shops as a training tool. Excellence is a daily pursuit.  

7. They are proactive and know that hope is not a strategy, wishing is not an action plan, and success in today’s market place is not an accident.

8. They assess their organizations from top to bottom and commit, not to “change,” but rather to a strategic process of transformation.

9. The owners take an active interest in making all this happen, with high levels of accountability.

I truly believe that the biggest obstacle most new-home sales organizations face today is the success they had during the boom times of the recent past. Breaking away from the old status quo is not easy, and sadly, not everybody is prepared to do it. Understand that if this were easy, everybody would be doing it. It’s been said that prosperity often conceals greatness, but adversity reveals it. What is your answer to the question: Doing what we’re doing, the way we are presently doing it, how many sales are we missing, and how much money are we wasting?

To get started in your transformation to increase sales and reduce costs, assess your current sales operation, your position in your marketplace, and develop a passion for knowing the important metrics that are the key to understanding how you are functioning.

Bob Schultz is president and CEO of Bob Schultz & The New Home Sales Specialists, a full service management consulting and sales company based in Boca Raton, Fla. Schultz is the author of two best-selling books, The Official Handbook for New Home Salespeopleand Smart Selling Techniques, and was named a Legend of Residential Marketing by the NAHB in Jan. 2010. He can be reached at bob@newhomespecialist.com.

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