Attention getting headlines vs. a true analysis.  This sums up what many in the factory-built home world believe is the heart of the issue with the IBISWorld report on the ‘top ten dying industries’ in America.  IBISWorld named manufactured home dealers as one of the top ten, and publications such as The Atlantic , Huffington Post online, Business Insider are among the many that picked up the story line.  If IBISWorld is correct, why does Warren Buffett, the sage of Omaha, bet against them?

Because the future of homebuilding is in factories.

So called conventional ‘on-site stick building’ is already a misnomer in the majority of cases.  Production builders get their name in part because they source their components from factories, and assemble factory-built components on site.  Manufactured housing, modular, panelized or core-building takes that a few steps beyond, by doing most precision work in the controlled environment of the factory.  By doing the work in a factory, the process is greener, the home built is more precise and can save money as well.  The factory-building process is greener, the home built is more precise and can save money as well.

As we have cited many times here at MHMSM.com, experts such as Dr. David Funk from Cornell University’s Real Estate department and Chuck Shinn, a consultant with ties to the National Association of Home Builders (NAHB), both project growth for manufactured homes.  Does anyone seriously think that those experts know something that Warren Buffett and his associates do not?

The essence of Dr. Funk’s study is the fact that once the foreclosure glut passes, there will be a strong pent-up demand for new home construction.  With incomes in the U.S. down, manufactured homes are priced right.  Population growth in the next 50 years is going to continue.  Manufactured housing is well poised to take advantage of these factors.  While building today is at record lows, the demographics suggest this must reverse in the near term, perhaps starting in the next 24 months.

Knowing the advantages of factory-building and the looming housing boom is doubtlessly what keeps Berkshire Hathaway purchasing companies in the manufactured and modular home building sectors.  Similarly, why else would Joe Stegmayer who leads Cavco Industries purchase first Fleetwood’s homebuilding enterprise and then more recently move to acquire Palm Harbor Homes?

As Thayer Long from the Manufactured Housing Institute (MHI) recently said in an exclusive interview with MHMSM.com, “It is kind of like this whole IBIS thing; who are they?…Okay, fine, they [IBISWorld] publish this report. Okay, it makes a headline; it will circulate around the Industry for a while.”

Long added: “That said, for ‘a dying industry,’ the numbers for Vegas [the annual MHI Congress] are looking outstanding. We are looking great. For ‘a dying industry,’ I heard from manufacturers that the Tunica [Manufactured Housing] Show was good. Show me ‘a dying industry.’” (Editor’s note, see the entire Industry In Focus report, with all of Thayer Long’s comments here. If you are not registered for premium content to access this excusive and in depth report, please click here for a free sign up.)

Long’s point on the uptick in event attendance and activity and its meaning has merit.

Information from the MHAO’s Deanna Fields about their 2011 Great Southwest Home Show in Tulsa, OK suggests they will have their best show ever.  There are more attendees registering, more exhibitors and more homes on display.  They have a robust line up of seminars.

The PMHA’s 2011 HOMExpo in York PA is set to return in style as well.  The numbers from the Louisville and Tunica Shows both suggested that there is plenty of interest among retailers and manufactured home community operators, even in these challenging times.  With some 970-1100 attendees at these two prior shows, the forecast for HOMExpo 2011 and the  2011 Great Southwest Home Show look bring indeed.

What this IBISWorld report underscores is the fact that the Manufactured Housing Industry needs to do a better job in working with the media!  Industry veterans already know about the 12 year industry slide.

Manufactured Housing retailers, communities, manufacturers and others in our business need to do a better job of communicating our message to the public at large!  While it would be grand if we had a national campaign, there is every reason for individual firms or perhaps state associations to make such a local or regional campaign a reality.

MHMSM.com in conjunction with the respective associations has organized two image and business building workshops for industry professionals with such goals in mind.

The first pair will be held in Las Vegas at MHI’s annual Congress.  The next set will be at the 2011 Great Southwest Home Show in Tulsa OK.  Here are the locations for our booths and the schedules for the workshops:

MHI Congress & Expo, Caesars Palace – Las Vegas, Nevada – BOOTH 610

>“Engaging the Media” Workshop, Thursday, April 28, 11:15 a.m.-12:30 p.m.

>“Dominate Your Local Market” Workshop, Wednesday, April 27, 2011, 1:00-2:30 PM

–    –    –    –    –

Great Southwest Home Show, QuikTrip Center, Expo Square – Tulsa, Oklahoma – BOOTH 101

>“Dominate Your Local Market” Workshop, Friday, April 30, 2011, 10:00-11:00 a.m.

>“Engaging the Media” Workshop*, Thursday, April 30, 2:00-3:00 p.m.

(* Editor’s note, the speaker lineup for the free “Engaging the Media” workshop in Tulsa will be somewhat different than in Vegas – stay tuned for final speaker details.)

Which brings us back to the question…

Why does Buffett or thousands of other professionals and owners bet on manufactured housing?  Think about it.

MHMSM.com strongly believes in the future of this industry.  We are betting on it the same as independent and corporate manufacturers, retailers, community operators, lenders, vendors and suppliers do.  If the ‘big boys’ keep investing in factories and communities and other parts of our industry, why shouldn’t we?

I get calls and  messages from some who lament the fact that others in the biz still say things like, ‘but that is the way we have always done it.’ The way we always made phone calls in the 80s was with a land line, not a cell.  We adapted.

We used to type with typewriters, then word processors, followed by computers, then laptops, notebooks and iPads.  We changed.  We adapted.

We didn’t text a few years ago. Email has been around for a dozen plus years.

So what is certain is that WE MUST BE WILLING to adapt to the changing times.

Look at the newer, nicer retail centers and communities.  They are looking more and more ‘residential.’  That’s a clue.  We still offer – wisely – ‘entry level’ HUD Code home product that is VOG style, but we also see more and more designs that are ‘residential.’  Another clue.

Those who fail to change and adapt risk extinction, as IBISWorld reported.

Likewise those who fail to serve their customers properly are at risk.  But there are those who have and will adapt successfully.  They will be the ones to enter a bright future.  Those who do not, will not.

It is our mission to provide you with the tools, information and resources to be successful.

Our tag line says it:

Innovation – Information – Inspiration for Industry Professionals

For those who refuse to change or adapt, the gloomy IBISWorld report could be their future.

But for those ready to be informed, inspired and innovative, the future can indeed be bright.  Stay informed here every day at MHMarketingSalesManagement.com.   But also go to the upcoming events.  Attend business building seminars, including our seminars, and see for yourself why you can not only survive, but thrive during these challenging times.

We are betting on it, Buffett is betting on it – why don’t you bet on it, too?  # #