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When Hard Hats Meet the Internet, Change Can be Profitable

Back when the common man, dependent upon his horse and wagon, first saw horseless carriages whisking by, it's not unreasonable to think that he shook his head, surmising that this contraption of bolts, phantom horsepower, and new-fangled sophistication would not radically change the way he conducted his life or his business.

One may liken this resistance to change to what has been demonstrated in the past by homebuilders, who watched the Internet grow, yet believed their lumber and mortar trades to be somewhat impervious to the high-tech world. Builders have always been a touchy-feely bunch. No, this is not a description of deep-seated emotional needs. The allusion is one that refers to the way builders have traditionally prided themselves as the creators and purveyors of the tangible, and not the intangible world. Doors must slam, windows must shut, toilets must flush, and paperwork must be signed off in the process.

There is nothing really left to the imagination in homebuilding - it's all out in front of you, from its raw beginnings to its finished glory. With most builders not being able to count on much else but hard work, hard-copy business is fast going the way of the dodo before their very eyes. And their inability to jump onto the cyber bandwagon will leave them in the proverbial dust should they continue to be in denial.

The telephone and fax machine are about the most technologically advanced pieces of equipment many homebuilders employ, one of their express purposes being faxing and calling around to get bids on supplies and building products. Using these almost anachronistic tools, the middleman distributor continues to reap his tidy little profit, and builders continue to get kicked in the margin-making pants on a daily basis.

But that is beginning to change. The lure the Internet can provide involves cost-savings on a grand scale to the $200 billion-plus U.S. homebuilding industry, with those relying on the World Wide Web for building supply bids saving from 15% to 25% on the end price of products, according to Greg Brooks, a general partner with The Construction Supply Group in Centerville, VA in a recent BUILDER magazine article.

Here, then, are some of the up-and-comers touting their homebuilding cyber-wares to effect change in how new home communities come together:

USBuild.com: an integrated supply chain service through which builders can gather and ship materials, matching the builder's specific needs, and also enabling them to supervise, track, and order over the Internet.

BuildNet.com: an e-commerce and project manager software provider

HomeBuildersXchange.com: Buildnet's own business-to-business purchasing supply venue.

Buildscape.com: a service enabling builders to automate the scheduling of projects online, including a centralized tracking system for purchases.

Which of these and others will flourish in the dot.com high platform of survivors is always anyone's guess. The fact that so many have sprung up so quickly may be a statement that the industry is finally ripe for change and at last owning up to the inevitable. For builders to reap more profit, they must do as many other industries have done, cutting out the middlemen and deal directly with other businesses in a position to do likewise.

There's no doubt that the new generation of builders must be formally educated from the top all the way down to the field personnel on matters of cyber-business, since many of these changes will result in the ability of the project superintendent to navigate the creation of his entire new home community from a palm-held, laptop, or desktop computer. And instead of homebuilder personnel placing threatening phone calls to dusty little distributors' offices three states away, they'll be able to point and click their way to on-time home completions, saving both themselves and their consumer clients time and money.

Published: October 9, 2000

Use of this article without permission is a violation of federal copyright laws.




A veteran of the real estate and homebuilding industries since 1986, Dena Kouremetis first joined Realty Times as a new homes writer in 1998. Since then, she has authored four books, written consumer columns on new homes issues for websites and newspapers all across the country, contributed to builder trade magazines, appeared as a guest expert on several radio shows and even created a ten-chapter podcast for LendingTree.com’s homebuilder website, iNest.com, now available on iTunes, entitled Uncharted Waters; Navigating the Purchase of a New Production Home.

Kouremetis recently joined her local Folsom, CA Coldwell Banker office as a broker associate while continuing to write for the real estate industry. For the past three years, she has been training real estate agents for both the resale and new homes industries, putting her experience, research expertise and gift of expression to work to help others entering the business.




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