There are only two ways to boost your bottom line: increase revenue and cut costs. In this blog, we’ll explore innovative ways for builders to cut costs in order to increase homebuilder profit margins – and we’ll examine revenue enhancement in a future post.
Long-Term Pricing Agreements
“Locking in building product prices for a specified period is often more important than getting the ‘best’ price,” says Bob Whitten, CEO of SMA Consulting in Orlando, Florida. “It’s very smart to take the long-term view. Just tell your dealer, ‘I’ll pay you a little more if you can lock in the price for an extended period.’ They’re usually happy to make that arrangement, and it saves money over the long haul.”
Cost Savings Through Design & Materials
Dennis Shriver, owner of Hearthside Homes in Kansas City, recently used engineered wood vertical siding to cut costs and speed installation on a 22-home project. Because the home designs featured exterior walls higher than 12 feet, there would have been a visible seam where 12 ft. siding panels met. This would have required the crew to build something down in the peak of the gable to create a shorter length or come up with an alternative to hide the seams.
Shriver chose 16 ft. vertical siding, which eliminated the seams and saved time and money on the installation. “Instead of finding ways to disguise the seam, my crew was able to simply apply one piece, cut to length and go,” he says.
Builders can also enjoy significant savings by using materials that reduce installation steps and don’t require special tools or equipment in order to help drive construction profitability. For example, there are now air & water barrier systems that install in one step, eliminating the cost and delay of bringing in a specialty crew the next day to apply house wrap.
One key to construction cost-cutting is to choose high-performance products that make installation simpler and less expensive.
We hear it time and time again from first-time LP® SmartSide® Trim & Siding users: “Why do installation instructions on how to install lap siding call for a 3/16-inch gap between vertical joints?” We’re here to explain that instructions for installing specify this gap for good reason—to allow the siding to expand during the acclimation process.Continue Reading
You may have recently heard the terms “resilient construction” or “weather-resistant building” being used more frequently within the architectural and construction industries. But what do these terms mean exactly? The Resilient Design Institute defines resilient construction (or resiliency) as “the capacity to adapt to changing conditions and to maintain or regain functionality and vitality in the face of stress or disturbance.”
When it comes to the wide variety of contractor loyalty programs that exist on the market, the tangible payoff it can have on your business is not always clear. But, not to worry. Today we break down the details of the LP® BuildSmart™ Preferred Contractor Program.
Radiant barriers have become very popular with efficiency-minded builders in the recent years. This is largely due to the fact that when installed properly, a radiant barrier can reduce the impact of summer heat and yield tangible savings in cooling costs of a home—a persuasive selling point when addressing potential homeowners. But how does radiant barrier work and what exactly are its effects?