Builders to dealers: Be proactive

Phoenix -- Federal Reserve economist Yelena Takhtamanova had both good and bad news for the attendees of the 2009 ProDealer Industry Summit (PDIS) in her address on Oct 8. The good news was that the recession is just about over. “The consensus is that we may have reached the bottom,” Takhtamanova said to a packed room of LBM dealers and suppliers. Housing starts and permits have hit their lowest point, she said, “although they didn’t have that much farther [down] to go.”

Takhtamanova was worried, however, over the 7 million jobs that have been lost since the beginning of the recession and the number of people who remain unemployed. Factoring in other data, the San Francisco economist predicted a slow, three-year recovery period before the housing market, the GDP and other indicators reach their pre-recession levels.

Faced with reluctant home buyers and a flood of foreclosed properties, Michelle Desiderio of the NAHB Research Center suggested that builders distinguish themselves with homes that carry a National Green Building Certification. Desiderio, the program director, explained the point scoring systems of the ANSI-approved designation, stressing its third-party verification system. She also gave an overview of the NAHB’s new Green Approved Products program, which lists pre-screened materials and their respective point values. “It eliminates the need for builders to do background checks on all these [green] products,” Desiderio explained.

Apanel of builders -- Tony Callahan, senior VP national purchasing, planning and design for Beazer Homes; Mark Voetsch, VP purchasing and cost management for K. Hovnanian; and John Coleman, VP purchasing for Maracay Homes -- discussed how the downturn has changed their purchasing and design processes. All three builders said they have removed costs from their supply chain and simplified their house models by collaborating with their suppliers.

“You need to be proactive in the process,” Voetsch said. “You should be telling us [not to] design homes that have 30 different window SKUS in them. Don’t be afraid to raise your hand and say, `I’ve got a better way.’ Just do it early in the process.”

The three-day event, which ends today, honored McCoy’s Building Supply and Home Lumber as the Home Channel News Pro Dealers of the Year. Accepting the award for McCoy’s at last night’s banquet was president and CEO Brian McCoy and his daughter, Meagan McCoy Jones, along with a team of McCoy executives that included a 40-year veteran, a 35-year veteran and a 28-year veteran of the company. Brent Johnson, who purchased his family’s California lumberyard back from Stock Building Supply, thanked his father Milt, who was also in the audience.

The National Lumber and Building Material Dealers Association (NLBMDA) installed its new officers at the Oct. 8 dinner, officially passing the gavel from ProBuild CEO Paul Hylbert, the outgoing NLBMDA chairman, to its new chairman, Dan Fesler, CEO of Lamperts.