Market Predictions & Stragegies, September 2009

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Interested in learning what the building, remodeling, and real estate industry's best and brightest are thinking? GuildQuality polled all of its members -- home builders, remodelers, contractors, and developers, to get their market predictions for the near-term and their strategies for dealing with it.

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Market Predictions & Stragegies, September 2009

  1. 1. Guildmember Predictions & Strategies About GuildQuality This summary of feedback is from GuildQualityʼs Sep- North Americaʼs best builders, remodelers, contractors, tember 2009 Market Predictions. This survey is a follow and real estate companies rely on GuildQuality to help up to the survey we began in October 2008, and have them monitor and improve the quality of their work. continued on a quarterly basis since then. In this and prior GuildQuality provides customer satisfaction surveying, surveys, GuildQuality requested feedback from all “Su- web-based performance reporting, peer benchmarking, per” and “Admin” users -- approximately 800 people from and performance marketing for construction and real es- the more than 500 home builders, remodelers, contrac- tate companies that seek to deliver a consistently excep- tors, and real estate developers that use our service. In tional customer experience. each of the most recent four surveys, more than 100 people provided feedback. GuildQuality offers a trial membership to qualified home- builders, remodelers, developers, and contractors. Visit Our members are representative of the best businesses http://www.guildquality.com/freetrial/ to learn more. in the building, remodeling, and real estate profession. And just as the strength of the building industry has his- torically forecasted the strength of our entire economy, I believe that our member sentiment is a leading indicator within the building industry. GuildQuality is Building a Community of Quality (888) 355-9223 www.guildquality.com © 2009 GuildQuality Inc. Page 1 of 13
  2. 2. Guildmember Confidence Index The Guildmember Confidence Index is a forward looking indi- cator that summarizes of the predictions of the members who participated in our survey. A positive number suggests that more members predict improvement than decline. In Q3 2009, members continue to predict improvement in both their companyʼs performance and the market, but they forecast less improvement than when they were asked the same ques- tion in Q2 2009. Among all of our members, Replacement Contractors predict the most improvement, and Real Estate Developers predict the least improvement. Guildmember Confidence Index. A positive number indicates more people forecast improvement than decline. A negative number indi- cates more people forecast decline than improvement. 100% would indicate all respondents forecasted improvement; -100% would indi- cate all respondents forecasted decline. GuildQuality is Building a Community of Quality (888) 355-9223 www.guildquality.com © 2009 GuildQuality Inc. Page 2 of 13
  3. 3. Confidence Level Distribution As in prior quarters, a growing number of members expect that conditions over the next six months will remain about the same as current conditions. The significant increase in “Remain the Same” answers came from members who previously predicted improvement. About the same percentage of members forecasted declines as in the prior quarter. While more members continue to predict im- provement in the market than decline, the largest percentage (64%!) believe that we better get used to things as they are. When asked about their own companies, the largest percent- age predict improvement or significant improvement, though that number is down to 49% from 56% in Q2 2009. Confidence Level Distribution. Guildmembers were asked to predict whether the performance of their company and the market would sig- nificantly improve, improve, remain the same, decline, or significantly decline over the next six months. GuildQuality is Building a Community of Quality (888) 355-9223 www.guildquality.com © 2009 GuildQuality Inc. Page 3 of 13
  4. 4. Comments: Following are the additional comments provided 17. Direct marketing in areas of current and pending actual jobs, inserting by our members, organized by question. ads in carrier-route based circulars, phone solicitation of previous cus- tomers. 18. Looking at ways to get our pricing in line with the other remodelers we “What is your business doing to address your most press- are competing against for projects. ing NEAR-TERM challenges?” 19. Negotiating as best we can, producing a lower cost product. 1. Continue to streamline our business practices with attention to best prac- 20. Managing cash flow as tightly as possible. tices. - Analysis of the communities to ensure they are well-priced within the marketplace. - Marketing the strengths of our communities and com- 21. Working on smaller projects and handyman services. pany as they appeal to our prospective homebuyers. 22. Increasing our marketing focus to past clients. Squeezing our overhead. 2. Increased newsletter & social marketing and circle-of-influence. Tightening our program. 3. We are ramping up to really educate the client on the difference between 23. Changing the way we advertise and get leads. what we do and the virtual timber frame companies out there that are just 24. Position of strength and stability. Renting vacant homes. More focus on a broker of CNC machine. turning lower quality prospects into buyers. 4. Cutting costs and overhead. 25. Reviewing our overhead and margins that we need to be profitable and 5. We are re-aligning our business to handle smaller projects and still meet get the projects. Updating our website continually to drive quality traffic to profit goals. Quite a challenge. turn into qualified leads/customers. 6. Networking everywhere talking to everyone. 26. Marketing, marketing, marketing as well as face-to-face networking. 7. Finding new ways to market as the market keeps getting smaller. 27. Unfortunately just having to operate the business on the playing field that we currently have - the purchasers/market are kind of dictating what final 8. More marketing to improve lead quality. sales prices will be. Our "long-term" goal is to be building houses next 9. We are trying to increase our marketing efforts to bring in more leads. spring. 10. Working hard to make sales and cut costs. 28. Taking on smaller projects at little margin. 11. Looking to move back into lower price point designs and spec levels, 29. We are actively seeking winter installation work to keep our crews busy being aggressive at pricing inventory, looking hard at costs for saving through the winter months of January and February when we are typically opportunities. slower. Sales staff are taking time off during winter months after the in- stallation calendar is full. 12. Work harder, concentrate more of each deal. 30. Positioning our place in the market as a company that cares. 13. Stressing the quality of our product. Additional marketing to past clients. Cutting overhead. Partnering with vendors. 31. Lowering prices. In order to remain active within the market, we've had to drop our prices significantly. The stock of existing homes is our biggest 14. We are remaining very focused on cost. We are maintaining our advertis- competition, and many deals can be had on foreclosures, short sales, ing and marketing expenditures. and the like. As such, many first-time home buyers are only choosing new 15. Watching our budget and making sure marketing dollars are being spent construction if the price is comparable with that of an existing home. To efficiently. that end, we've lowered our prices in order to continue selling. 16. GuildQuality. 32. Building a backlog on our schedule. GuildQuality is Building a Community of Quality (888) 355-9223 www.guildquality.com © 2009 GuildQuality Inc. Page 4 of 13
  5. 5. 33. Improve sales process, tighter packages, improve marketing, upgrade 51. We started doing handyman services as well to keep our guys busy. production personnel and process. Buying land and building a showroom/ 52. Watching costs and training to maintain adequate volume. office. 53. Dropping house size/amenity levels/prices with no profit included to try 34. Increase marketing. and recover some overhead and keep our remaining employees working 35. Increasing our flexibility and adding supplier options that address the and some subs/vendors going. basic needs of the clients Freezing hiring. 54. Open to all customer suggestions and desires, more than before. 36. Working to offer a more affordable product. 55. Anything we can to cut overhead and find any type of business that will 37. Cut overhead and staff along with increasing marketing expenditures and pay us for our efforts. doing smaller projects that we used to turn down. 56. More aggressive sales effort. Pushing subs and suppliers for lower pric- 38. Revising marketing strategy and budget predictions. ing and faster production. Reducing our margins to get business. 39. Making sure that the customer is being heard and follow through on every 57. Neighborhood discounts and on-time performance. lead. 58. Keep trying to sell, sell, sell and managing backlog. Continuing to seek 40. Better trade partnering , more hands on approach by each employee. out cost-savings wherever possible. 41. Trimming the fat. 59. Being as cost effective as possible in the field and in the office. 42. We are running the business mean and lean. Any expense we can cut we 60. Working with our construction lenders to try to ensure an adequate flow do! Our staff has been reduced and we are all working a lot more hours. of construction financing. Our primary focus is to keep advertising as no one else is (except the 61. Trying to be much more efficient on our jobs. Since the pipeline has be- larger companies). come so sparse, every cent counts. 43. Cutting overhead as much as we can. 62. Talk to our customers about their project to make sure they really want 44. Working hard on customer satisfaction and meeting or exceeding expec- what they say they want, phasing larger projects into manageable budg- tations. ets. 45. Improving our total value proposition. Offering new systems and meth- 63. Extra focus on sales and managing our leads better. ods, integrating technology to improve customer service and aggressively 64. We are trying new sales ideas. working through the entire supply chain to deliver the lowest cost possi- ble. 65. Adjusting. 46. Working on our electronic marketing. 66. Trying to reduce cost of construction. 47. FHA approval of product. Partnering with "condo-loan" friendly banks. 67. Praying that the recession ends before we get to the end of our credit line. 48. Stepping up marketing efforts. 68. Watching costs, not making big expenditures, keeping staff low and work- 49. We're finding new subcontractors & suppliers and lowering our mark-ups ing the owners to death. to stay competitive. 69. Redesigning our website to track surfers and deliver content relevant to 50. Getting multiple competitive bids for nearly each trade; being much more their specific surfing habits. Looking at social networking and texting. budget conscious to convince the customer that they would be receiving the very best price. 70. Praying! GuildQuality is Building a Community of Quality (888) 355-9223 www.guildquality.com © 2009 GuildQuality Inc. Page 5 of 13
  6. 6. 71. More aggressive purchasing to compensate for leaner margins. 7. Lower over head to help bottom line. 72. Reducing costs any way we can; reducing staff; increasing customer care 8. Planning. with lots of follow-up for every lead; expanding services to include small 9. Not expecting major changes in the market. Gear up for operating as a jobs we never would have looked at before and offering home repair smaller business. service; holding showroom events to attract new leads; looking to share our office and shop space. 10. Added remodeling to our offering, spread ourselves back into lower price point and smaller square foot homes. 73. Getting on board with energy efficiency promotions and really offering a great solution. 11. Worrying about builder financing - haven't moved to the "how we gona do it" phase yet. 74. We are implementing an online lead generation strategy called Sure Fire Social, which will take advantage of SEO, online information give-a-ways, 12. Restructuring and positioning for growth opportunities. social media, and building lists. 13. Maintaining our advertising and marketing budgets, updating our website 75. Staying educated. and implementing a new estimating system. 76. Balancing overhead vs. revenue. 14. Watching our budget and making sure marketing dollars are being spent efficiently. 77. Cutting costs that we can pass on to the customer. 15. GuildQuality. 78. Developing a local website to augment our parent franchise's web site. We are also working with a photographer to shoot some of our better 16. Yellow pages, signage and visibility upgrade, augmenting showroom curb projects in order to promote our quality of work. We are trying to set our- appeal and displays, general advertising. selves apart from Joe Pickup. 17. Working on increasing our marketing using direct mail, internet presence 79. Keeping overhead and personnel low. and follow up with past customers. 18. Working with our banks to discuss solutions. “What is your business doing to increase your likelihood 19. Changed from traditional marketing venues to event marketing to drive of success in the LONG-TERM?” traffic to the community. Controlling the land development timing to more closely coincide with market demands. 1. Planning & conservative budgeting. 20. Not building so many homes in advance to have to pay loans/taxes on, 2. Thoroughly evaluating new business opportunities to ensure that they not replacing employees that move on, comparing pricing on a more meet our standards. Ensuring that our entire company is dedicated to the regular basis and not just sticking with a company because we've always success of our company. Creating a team environment. used them. However, in saying that quality is still a priority. 3. We are making planned cut backs in per diem expenses and other non- 21. Increasing targeted advertising within our desired community. essential expenses. We are also restructuring some of our job descrip- tions and working on training the artisans. 22. Using more subcontractors, holding off on employee benefits and com- pany expansion plans. 4. Selling land. 23. Trying to make our company stand out from our competition and moving 5. Becoming less niche oriented and looking at all new possibilities in the to a wealthier client base. market. 24. Sticking to our core business, doing it the best we can. 6. Exploring consolidation/co-oping options. GuildQuality is Building a Community of Quality (888) 355-9223 www.guildquality.com © 2009 GuildQuality Inc. Page 6 of 13
  7. 7. 25. Lining up equity funding sources to acquire distressed assets. 43. Advertising! Any way we can that we know will bring us clients. We are spending a lot more time on relationships with the clients. 26. Constantly amending the short-term will primarily position us for the long- term. 44. Trying to remain viable and in business with our core crews intact. 27. Building image, also branching into new areas such as home perform- 45. Praying. Looking for ways to maximize manpower and cut costs. ance contracting. 46. Maintaining relationships with key referral sources and developing new 28. Aggressively negotiating with suppliers/subcontractors to decrease costs. relationships. Considering standard specification changes to help decrease hard costs 47. Working on our in house systems to improve productivity. and consequently sales prices. Keeping our spec inventory very conser- vative to limit exposure, and when we do start specs we are very cautious 48. Increasing internet presence, expanding market area and working with on adding upgrades that in turn increase sales prices knowing that we more and stronger realtor base. are going to be discounting heavily to write contracts. 49. Branding our neighborhood. 29. Improving back office functions. Improving marketing functions. 50. We are staying true to our business goals of creating quality projects & 30. Continued marketing strategies and building systems to increase effi- focusing on our tried and true remodel process. If our clients are happy ciency. Surveying customers to find out how we can do a better job. and satisfied, they will refer us to others. 31. Positioning our place in the market as a company that cares. 51. Steady and consistent investment in marketing. 32. Cleaner balance sheet, less land acquisition and development, diversify- 52. We continue to be consistent with quality as that's what our clients come ing our product line. to us for in the first place. Top notch customer service and top notch qual- ity. 33. Streamlining operations, reviewing costs, implementing positive changes and upgrading talent. 53. Cut overhead to the bone. 34. Marketing and sales upgrade, hiring another salesperson. 54. Focus on marketing. 35. Expand our services. 55. Survival and preparing for the green revolution. 36. Shifting our marketing to web-based vehicles and methods Restructuring 56. Hanging on to top people. Continuing full-scale marketing. our benefits programs. 57. Fix our internal inefficiencies and productivity challenges. 37. Lots of MLS research, expanding into the Active Adult and attached unit market to bring more affordable product to market. 58. Releasing new series of plans at a lower price point to capture more first time buyers. 38. Keeping core employees and continuing to train and educate the team while staying within a workable company budget for today's revenue. 59. Bidding as many jobs as we can and keeping our company's name "out there". 39. Continuing to be good stewards of our money. 60. Introducing new designs and keeping our eyes open for new locations 40. Marketing effort to create valuable leads and keeping all the team mem- that match our product. bers focused on customer satisfaction. 61. Trying to stay afloat in the short-run. 41. Securing a land position from banks that are de-leveraging. 62. Keep our quality high, our costs fair, building brand name recognition. 42. Revising web sites, sales materials etc. GuildQuality is Building a Community of Quality (888) 355-9223 www.guildquality.com © 2009 GuildQuality Inc. Page 7 of 13
  8. 8. 63. Cutting expenses, developing a better web based marketing plan and being much more careful to be ready before proceeding. Permitting has approach, attracting and hiring talented and smart people. become an issue and in some cases appraisals. 64. Additional advertising. 4. Quality over quantity. 65. Tight Budgeting in all areas. 5. Smaller job size. Larger projects are difficult to come by let alone get one to sign. They are also much more apt to take their time making remodel- 66. Cutting costs and prospecting. ing decisions. Also cost is much more a significant part of the decision 67. Diversifying into green specialties (building LEED certified spec home, process. which will help us with marketing as knowledgeable about sustainable, 6. More maintenance type work - but they are willing to improve while main- resource efficient, value centered projects). taining. Examples such as cement board siding, extended life shingles, 68. Working the owners to death - they're cheap labor! Seriously - we are high performance windows. going after all projects - no matter how big they are; whereas two years 7. Smaller more affordable projects. ago we wouldn't have considered a $10K project or gone to a job 45mins away! 8. Smaller projects and shopping price. 69. Praying! 9. I see smaller projects like kitchens and baths as opposed to the larger additions I have seen in the past. 70. Liquidating or improving non-performing land assets. 10. People are looking for small things that make a difference. We are seeing 71. Trying to give each and every job, no matter the size, the same high de- lots of bathrooms, partial kitchens, and repair work. There are also a lot gree of customer service and high craftsmanship we are known for; re- of new young homeowners looking for inexpensive renovations. They designing our website, exploring internet marketing options. often have not hired a remodeler before. 72. High quality product with a high quality reputation. 11. Smaller square footage, more interest in ranch designs, price point lower- 73. Diversifying. ing. 74. We started a remodeling division and are working with subs and vendors 12. Continued down sizing, pricing concerns, smaller lots & houses - eco- on pricing. nomic downsizing. 75. Finding below current market land value positions. 13. Downsizing or rightsizing. Some interest in moving into more urban set- tings for conveniences and amenities. 76. Continuing marketing and remaining lean. 14. Energy efficient furnaces, zoning, windows, very cost conscious. 15. Nothing really new. Just updating and some additions. Financing still “What trends do you see emerging among your customer seems to be a problem. preferences?” 16. Scaling down their expenditures while increasing their level of expecta- 1. A handful of larger job leads have emerged (additions vs. remodeling of tion. Close to quote ratio is 50% of 2 years ago, due to vastly greater existing spaces). numbers of quotes each customer is getting. 2. Good service, they want attention from start to finish - Quality construc- 17. Looking for products that are good quality but aren't overly expensive. tion - Value - Location - Proximity to family. 18. It's all about the price - if its not a short sale, they paid too much. 3. There is still a range between residential and commercial. But, we seem to be bidding on more and more commercial work. Residential clients are GuildQuality is Building a Community of Quality (888) 355-9223 www.guildquality.com © 2009 GuildQuality Inc. Page 8 of 13
  9. 9. 19. Small homes with quality amenities. Continued interest in sustainable/ 38. Reconfiguring space rather than adding additional space. Opening Kitch- green designs. ens to create a great room affect and upgrading bathrooms. 20. More comfort areas where they can entertain and relax at home with fam- 39. Finding affordable means to get needs and wants met. ily & friends. 40. Very price conscious and they also understand the value of the right con- 21. Breaking down bigger projects into smaller phases that can be done over tractor doing the work and the ability to make decisions that add value to time. More maintenance than new additions. the project. 22. Smaller budgets for jobs. More price conscious. 41. Less square footage and more value. 23. Canadian content and green living. 42. Green efficient housing. Low operating costs. Livable space somewhat smaller and budget conscious. Built in TV and Audio. Outside living 24. More value conscious. space. 25. Affordability is an issue. Finanancing more important. 43. Clients are spending less on projects and are scaling their needs down. 26. Customers are still driven by price primarily and will make costly mistakes Energy efficiency is a big concern - the tax credits have really helped to due to their beliefs. Those mistakes will be detrimental to the image of secure more sales. remodelers/contractors and unfortunately erase the gains over the last 44. Everything is still about price. decade. 45. Customers spending less on replacements. 27. Less glamour, more bread and butter. More repairs, energy retrofits, con- cern for saving money. 46. A lot of house at a low price. In some cases my clients are down sizing so that is an issue. 28. Lower prices, discounts, etc. seem to be the major continuing issues. 47. Customers are purchasing more and more kitchens and baths. 29. Frugality. Price Conscious. 48. More upgrades and options. 30. A strong movement to tri-pane glazing to maximize energy savings and comfort levels. 49. More square footage for less money. 31. Slower to begin a project and talking with more contractors. They have 50. They are definitely more price conscious, but still want quality. the expectation that construction costs are greatly reduced. 51. Value for money spent. 32. We've seen a trend toward smaller homes. Our average square footage 52. More budget driven. of homes sold has gone from roughly 2100 sq. ft. in 2006 to just over 1800 sq. ft. in 2009. We're also seeing more home buyers ask for and 53. Very price sensitive. order finished out basement space (additional bedrooms, bathrooms, living space). 54. Price, Price, Price. 33. Attention to detail and quality. 55. Shopping around more and more for the best deals, especially in selec- tions. want the most for their money. 34. More detailed and exacting. Look at everything. 56. Smaller projects, less lavish, cost conscious, slightly green. 35. Smaller types of projects. 57. More budget conscious. Slower to decide to move ahead. 36. Economical basic remodels or upgrades using stock materials. 58. A feeling of "getting the best deal". 37. Smaller homes with more amenities. Buyers are seeking more value. 59. It's still very challenging to obtain financing. GuildQuality is Building a Community of Quality (888) 355-9223 www.guildquality.com © 2009 GuildQuality Inc. Page 9 of 13
  10. 10. 60. Anything "green". “What trends are becoming less and less important to 61. Looking for slightly smaller homes on not-so-big lots. your customers?” 62. We now have to help our customers downsize to reasonable projects. At 1. Grand, oversized space is not a big priority. first they want all the bells and whistles, but then after discussing costs 2. Buying the most house they can afford - now want to buy enough house they back track to more of a frugal project. for their needs - Options and upgrades. 63. Customers cautious about spending money and having difficulty financing 3. Big box housing. projects - thus the trend has been for smaller projects that customers can pay for directly. 4. Less service and more cost. 64. More focused on price over value. 5. Value and energy efficiency. 65. General Contracting Themselves. 6. Over done, Extravagant projects. 66. Concerned about cost but still want the big house. 7. Big expensive project. 67. Smaller jobs with tighter budgets, phased projects. 8. I see the big Green trend all over the place, but when it comes down to it, most people don't want to spend the extra money. 68. More price break-outs. 9. Big fancy projects. 69. More electronic communication, website, email, texting, social network sites. Wiring for networking in our homes. 10. Square footage for square foot sake. 70. More Practical. 11. Opposite of above - less showiness. 71. Emphasis on quality of design, not quantity (i.e. square footage). Green 12. Square footage. products. Maintenance free products. Manufactured stone instead of 13. Over the top designs. brick. Tiled showers. 14. Fashion & style is out. Function, efficiency, effectiveness, warranty is now 72. Smaller jobs, do not want to sign retainer agreements, taking a long time king. to make decisions, putting off work to the future. 15. Normal upgrades and higher quality. 73. Energy efficiency trends. 16. Bigger homes on larger lots. 74. People are spending the same money as they always have. We just don't have as many leads. 17. High end extras, no additional costs added to home. 75. Green building more important. 18. Tearing down a house and starting over. 76. Colors! Deeper and or more vibrant colors in paints.. 19. Carpets and other manufactured products. 77. Smaller, less expensive homes. Energy efficiency. 20. Living without unnecessary changes or additions (putting off that outdoor kitchen or daughter's bathroom redo). 78. Cost is much more of a factor than it previously was. Clients are also looking to talk to more contractors prior to signing with a remodeler. They 21. Requiring all the latest and greatest materials. They are settling for less are also looking for designs with more functionality and clean lines. based on economics and rethinking what their personal requirements are today. 79. Families condensing and moving in together requiring in-law apartments. 22. High end costly appliances and large spaces. GuildQuality is Building a Community of Quality (888) 355-9223 www.guildquality.com © 2009 GuildQuality Inc. Page 10 of 13
  11. 11. 23. Spending money on upgrades. For example, in a conversation with our 42. Silestone or Corian counters. internal design consultant recently, the few customers that we are seeing 43. They are more open to suggestions as to how to save money on their these days are sticking to base grade carpet or maybe going up 1 level projects. and that is it. Up until about the end of 2007 we were very successful at selling higher levels of upgrade carpet. 44. Green remodeling; high-end or luxury finishes. 24. Cheapest price. 45. Green products haven't really taken off. 25. Bigger. 46. Overbuilt opulence. 26. Larger homes are becoming less important. Customers are selecting the 47. Size and ALL the bells and whistles. most important options and foregoing some of the minor products - par- ticularly those that can be added at a later date (hardwood flooring, gran- 48. Size of house. ite countertops, etc.). Structural elements, like three car garages and nine 49. Quality. foot ceilings, are being included whereas many of the cosmetic options are being postponed. 50. Rather than less important, more is becoming important to buyer. Buyers want quality, choice & value and aren't as interested in compromise. 27. Uncertified work. 51. Big lots. 28. Green is never mentioned by consumers. 52. High end, lavish finishes. 29. Green. 53. Large projects - customers seem to be down sizing - not only size but 30. High end custom kitchens and bathrooms. style. 31. Theatre Rooms are going away. People may want a media room but it 54. Large, expensive add-ons. would be incorporated into the living space. Living Rooms are gone and offices are taking their place. 55. Paying for "Green" construction. 32. Large additions and trendy finishes. 56. Large luxury jobs with big budgets, doing it all at once. 33. Over the top consumption. 57. Appearing overly expensive. 34. Ultra high luxury items somewhat less important. 58. Less responses from print and other advertising media; more reliance on referrals and relationships. 35. Frills non value added features. 59. Urgency, they are willing to wait to ensure they are able to take full ad- 36. Theatres. vantage of desperate contractors. 37. Clients are a lot more educated about the products and services they are 60. 2-Story great rooms, formal dining rooms. Whirlpool tubs. seeking. They continue to look for remodelers who can meet their needs. 61. High-end anything. 38. Customers are not calling on large homes. 62. Quick fixes for cheap prices. 39. More interested in price than quality. 63. "Bigger is better." 40. Everyone is value shopping. Great Home, Great Price, Great Customer Service. They still want everything! 64. They still want it all. They just do not want to pay for it. 41. Additions. Also, higher end products. 65. Central vac, trash compactors, etc. GuildQuality is Building a Community of Quality (888) 355-9223 www.guildquality.com © 2009 GuildQuality Inc. Page 11 of 13
  12. 12. 66. Large homes. and are just not there when we could use them. I have never been late or missed any payment to my bank. Further I have 65% equity in the build- 67. The Olde World look. (Tuscan country etc.) ing I have my office and showroom along with eight additional tenants which has the building full - and everyone is current with me. My bank doesn't care about my past history or my good credit standing. If we are Additional Comments going to have a recovery in the building industry it will start in the remod- 1. I see a steady flow of work but also see a large increase in single truck eling sector. Banks are not lending, yet they have our bailout dollars. companies forcing the price of jobs down. They are not 100% legal but 10. Absolutely no consumer confidence. No urgency and everything is price consumer thinks license and insured is ok. driven. My gut feeling is we are in for another 16 to 20 months of the cur- 2. Help! I'm trapped in the body of a contractor! rent situation not sure how many will survive. 3. Our clients are thinking different now. Green living is a movement that is 11. HELP just taking hold, but will not be fully accepted until the costs go down. 12. We are thankful that Texas has been somewhat immune to the chal- Your people must be comfortable in dealing mostly by email and wireless lenges in the rest of the country. However, we are watching our costs and technology. Website design is huge! If you do not have a great website going after every project that comes our way. your are missing a whole generation of clients. I have people tell me that I must be a great builder based on how much they liked my website. 13. Would still like to be able to connect with our survey results through web services. 4. The companies that keep beating the bushes for ways to get more quality leads will survive the downturn 14. We are facing the toughest challenges ever in our twenty-six years of existence yet we are trying to remain optimistic about the future. 5. The expiration of the $8,000 Federal Homebuyer Tax Credit could have a profound impact on market activity. We've seen an up tick in the entry- level segment of our market, which can partially be attributed to the tax credit. Unless the government announces a new home buyer stimulus plan, there could be a major slow down in the housing industry again. 6. I believe we are in for another tough winter. We have enough contracts over winter but we are working to change or add items to our business model. The national media says things are beginning to improve. I just see them holding steady with more consumer confidence. People are hording their money. They won't spend as much on a house. 7. I believe our response to the market determines our success and not the market itself. Our marketing has a greater emphasis on our client base. Currently 65% of our revenue is coming from our client base. 8. I think we are running along the bottom and unemployment may cause a further dip but I think we will bump along for 6-8 months with opportuni- ties coming and going. You need to react and catch the opportunities when they show up. 9. The big banks in this country are not supporting any of the building busi- ness owners I know in Michigan. The are all calling their credit lines in GuildQuality is Building a Community of Quality (888) 355-9223 www.guildquality.com © 2009 GuildQuality Inc. Page 12 of 13
  13. 13. A note about responses that were not included in this report. Not included in this report is feedback from about 50 prospective members -- builders, remodelers, contractors, and developers who are not Guildmembers. After a few more quarters of these surveys, I intend to produce a larger, more comprehensive summary that will include everyoneʼs feedback. Future Surveys & Reports We will continue to conduct this survey in the last month of each quarter, with the next survey to occur in December 2009. Thanks to all those that participated! I look forward to continuing to provide you the kind of information contained herein, and I greatly appreciate your participating in the survey. I welcome any comments, suggestions, or requests you have about this and future reports. Sincerely, Geoff Graham Founder & President GuildQuality Inc. geoff@guildquality.com (888) 355-9223 GuildQuality is Building a Community of Quality (888) 355-9223 www.guildquality.com © 2009 GuildQuality Inc. Page 13 of 13

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