flexiblefullpage - default
Currently Reading

3 Ways Lean Design Can Help Home Builders Recover Margins

Advertisement
billboard - default
Lean Building

3 Ways Lean Design Can Help Home Builders Recover Margins

Using a Lean design and construction approach, home builders can reduce waste and costs without sacrificing amenities or marketability of their produc


By Todd Hallett, AIA November 21, 2022
Lean design involves advanced framing to save lumber in home building
Better for everyone: A Lean design and construction approach can save home builders serious money on their bottom line without compromising the homebuyer satisfaction. | Photo: courtesy Todd Hallett

Skyrocketing material and labor costs followed by sharp interest rate increases have worsened the current housing affordability crisis. These factors have forced home builders to reduce pricing, and therefore profit margins, to maintain sales velocity. 

A Lean design and construction approach is the best way forward for home builders to reduce waste (and costs) without sacrificing amenities or marketability of their product..

What Is Lean Design in Home Building?

Lean Design is a tool builders all over the country use to reduce costs. A common misconception about Lean Design is that it’s just an updated version of the old chestnut, Value Engineering. Not at all. 

In fact, value engineering in construction became a vehicle to strip away important amenities and aesthetics that make homes exciting and attractive. 

While the goal of Lean Design is to eliminate waste, the product that results from Lean Design is superior when it comes to aesthetic design, innovative planning, and increased amenities. 

Lean Design employs the use of a structured collaborative process that involves key building team members in collaboration with trades and suppliers. The goal is to optimize home efficiency and effectiveness for increased sales velocity at the best possible profit margins. Lean Design never cheapens the home or reduces its value; instead, it increases focus to provide only that for which the customer will knowingly and willingly pay.


RELATED


Starting the Lean Design Process: Field Walk

The best way to start the Lean Design process is to get out in the field. But first, you want to establish your Lean Team, including members of the construction, purchasing, estimating, design, and sales teams. 

Then, take the team out to the field and visit a home in the frame stage. Take a close look at your headers over doors, windows, and fireplace openings. To this day, I have yet to walk into a house that doesn’t have considerable excess lumber that can easily and safely be eliminated.

Computer modeling to help with advanced farming in Lean Design for home builders
3D computer modeling software comes in handy for advanced framing design during the Lean Design process. | Image: courtesy Todd Hallett

 

What to Look for When Optimizing Timber Framing

Framing items to review and scrutinize: 

  1. If a header is running parallel with the joists above (in the case of a two-story frame).
  2. If a header is running parallel with a truss or rafter system.
  3. If a header has no way to bear on a footing or a beam.

Exception: Watch out for point loads created by purlins, headers, or other structural members above. 


RELATED


After identifying excess framing members, compare your notes with the construction drawings. Are the headers called off? Have the framers installed excess headers as a matter of course? Is it possible to reduce header sizes indicated on the plans? 

Overengineering is also a huge source of waste in our industry. If you feel the engineering is heavy, you may want to consider using a test job to get a second opinion. And framing is just the beginning; train your Lean Team to look for field waste at all phases of construction.

The Role of Trades and Suppliers in the Lean Design Process

Trade and supplier involvement is key to the Lean Design mindset. A collaborative effort must be present from the initial stages of design. Long before building the initial prototype the design should have input from framing, HVAC, plumbing, electrical, cabinet supplier and others. 

Utilize simple review checkpoints during the production of the design. Remember to allow extra time in development for reviews at drawing milestones. This type of involvement will work to create a culture of waste and cost reduction with your trades and suppliers as well as your internal team.

Lean Design Construction Documents

An overriding goal is to create construction documents that reflect Lean Design principles. They are the ultimate vehicle to create the most dramatic and marketable home possible that will cost thousands less to build than your competition. 

Eliminating waste in design is the key to being able to upgrade amenities and curb appeal. Lean Design will have little wasted floor space, no unused rooms (such as a formal living room), and current, fresh, relatable design. The construction drawings will be complete, accurate, and carry the signature of knowledgeable trade input. 

The reduction of direct construction costs is paramount to reducing sales pricing without butchering margin. The best way to reduce cost is to cut out the fat, and for that there simply is no better approach than Lean Design.


 

Written By
President

Todd Hallett, AIA, president of TK Design & Associates has been designing award-winning homes for more than 20 years. He spent 15 of those years working for a $50 million production building company. Todd designed all of its homes but also worked in every other aspect of the company including purchasing, development, land acquisition, product development, and operations, and was president of the company for three years. Equipped with his vast building experience and fueled by his love for architecture he left to form an architecture firm that is second to none in working cohesively with builders. Todd specializes in Lean Design and works, alongside Scott Sedam of TrueNorth Development, in the trenches with builders, suppliers, and trade contractors. Todd welcomes your feedback at thallett@tkhomedesign.com or 248.446.1960.

Related Stories

Lean Building

Reducing 3 Types of Construction Waste to Increase Home Builder Profit

Waste in home building is a much broader term than most home builders think. Here’s how builders can take stock of all forms of waste throughout the construction process to achieve greater profitability

Business Management

Commodity Purchasing? There’s No Such Thing

Do you know all of the elements of the true total cost and total benefit for all of the products you put in your homes?

Business Management

Lean Construction’s Greatest Hits, Vol. 1

Lean building is never about dumbing down houses and making them hard to sell; it’s about adding value

Advertisement
boombox1 -
Advertisement
native1 - default
halfpage2 -

More in Category




Advertisement
native2 - default
Advertisement
halfpage1 -

Create an account

By creating an account, you agree to Pro Builder's terms of service and privacy policy.


Daily Feed Newsletter

Get Pro Builder in your inbox

Each day, Pro Builder's editors assemble the latest breaking industry news, hottest trends, and most relevant research, delivered to your inbox.

Save the stories you care about

Lorem ipsum dolor sit amet lorem ipsum dolor sit amet lorem ipsum dolor sit amet.

The bookmark icon allows you to save any story to your account to read it later
Tap it once to save, and tap it again to unsave

It looks like you’re using an ad-blocker!

Pro Builder is an advertisting supported site and we noticed you have ad-blocking enabled in your browser. There are two ways you can keep reading:

Disable your ad-blocker
Disable now
Subscribe to Pro Builder
Subscribe
Already a member? Sign in
Become a Member

Subscribe to Pro Builder for unlimited access

Lorem ipsum dolor sit amet, consectetur adipisicing elit, sed do eiusmod tempor incididunt ut labore et dolore magna aliqua.