How to develop a partnership between home builders and manufacturers that benefits your business.

In business, it takes a village… Beyond your employees and customers, strong partnerships with key manufacturers open the door to a multitude of possibilities.  From exclusive products to rebates, manufacturers and contractors have a symbiotic relationship that requires trust, guidelines and the ability to maximize opportunity from both sides.

Just as there is competition between home builders, there is a tight market for manufacturers; the many unscheduled “check-ins” and seemingly random calls builders receive each week from manufacturer’s reps should be evidence enough to know that many companies are looking to make your business part of their business.  And while such interruptions can cause more inconvenience than interest, what seems like constant bombardment isn’t all bad.  Both contractors and manufacturers have similar goals in common, and they can and should work together to build a strong understanding for expectations and customer base.  By working together, as partners, both parties are enabled to provide the greatest value to customers at the lowest cost possible.

Additionally, as a home builder, there are various direct incentives and rewards that can be reaped from partnering with a manufacturer.  Some examples include:

• Manufacturer rebates
• Early access or exclusive access to specialty products
• Exclusive rights to installation
• Warranties and the ability to negotiate terms
• Lines of credit and flexibility

While incentives can be reason enough for a home builder to jump into a partnership with a manufacturer, don’t make the leap just yet.  Like any good relationship, a proper partnership takes time, understanding and commitment.  You should take the time to ask questions and draw a clear map for expectations.  Being transparent with each other can build a sense of security that is needed to be confident in pricing, availability, timely delivery and quality of products.  Choosing a manufacturer shouldn’t be based on the squeakiest wheel or who is currently on your payables either.  Consider them part of your team and conduct the “interview” that you need to get the important questions answered.  When deciding on the right manufacturer for partnering with your company, consider the following:

1. Product – Is the product and cost the right fit for your customer base? What are your primary services, and how does this product fit into your customers’ needs and budget?
2. Know Your Value – What do you bring to the table in the partnership? What benefits can you offer as a builder, whether it be reaching a niche market or having concentration in a geographic area of interest?
3. Define Your Terms – Just like any negotiation, you will need to allow for some give and take, but have a clear idea of what you want and need as a starting point and work with your choice manufacturer to find a fair balance.

Partnerships require commitment, from both sides, so it is important to take time in making your decision.  Along with making sure the products are a good fit for your business, work to get to know each other, expectations for terms, outcomes and management.  By taking the proper steps in choosing a manufacturer, you will find the “right” partner rather than the partner for right now.

For more information on construction business and marketing tips, stay connected with the HBW Blog.  To get ahead of construction activity and gain access to the latest permitting data in Florida, Texas, Georgia, Alabama and Oklahoma, contact HBW for more information on construction data reports and industry leads.