SCH IAVI HOM EBU I LDERS CUSTOM IZED MODULAR HOMES FOR THE PEOPLE SCHIAVI HOMEBUILDERS IS A SMALL company with big ideas. Headquar- tered in Oxford, Maine, with a satellite office in Bethel, the company employs a mere 28 people. Originally founded by John Schiavi and his father in the 1950s, the company operated as a mobile home sales company for the next 30-odd years until Schiavi decided to sell and move on to other ventures. After changing hands several times the company ended up in bank- ruptcy, whereupon Schiavi decided to buy it back. The new company, Schiavi Homebuilders, reopened in January 1997, \vith Scott Stone at the helm. Stone, who is now President by Heleigh Bostwick 90 I AMERICAN BUILDERS QUARTERLY FAI.L 200] of Schiavi Homebuilders, was brought in to manage property while Schiavi remained a silent partner. Schiavi Homebuilders has since expanded into the modular housing market and is slowly moving out of the mobile home business. "Modu- lar homes were only 30 percent of our business when we first started selling them. Today 85 percent of our business comes from modular homes," remarks Stone. He says there are several reasons for this. "The first is that the market is very soft for mobile homes. The second is that it doesn't fit into our company vision
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SCH IAVI HOM EBU I LDERS
CUSTOM IZEDMODULAR HOMES FOR
THE PEOPLE
SCHIAVI HOMEBUILDERS IS A SMALL
company with big ideas. Headquar-tered in Oxford, Maine, with a
satellite office in Bethel, the companyemploys a mere 28 people. Originallyfounded by John Schiavi and his fatherin the 1950s, the company operatedas a mobile home sales company for
the next 30-odd years until Schiavidecided to sell and move on to other
ventures. After changing hands severaltimes the company ended up in bank-
ruptcy, whereupon Schiavidecidedto buy it back. The new company,Schiavi Homebuilders, reopened in
January 1997, \vith Scott Stone at thehelm. Stone, who is now President
by Heleigh Bostwick
90 I AMERICAN BUILDERS QUARTERLY FAI.L 200]
of Schiavi Homebuilders, was brought
in to manage property while Schiavi
remained a silent partner.
Schiavi Homebuilders has since
expanded into the modular housing
market and is slowly moving out ofthe mobile home business. "Modu-
lar homes were only 30 percent ofour business when we first started
selling them. Today 85 percent ofour business comes from modular
homes," remarks Stone. He says thereare several reasons for this. "The first
is that the market is very soft formobile homes. The second is that it
doesn't fit into our company vision
anymore. And third, I'm a builder-
not a salesperson." Stone explains thatmobile homes, unlike modular homes,
are more about selling than building.
There's also a demand for this type
of housing in Maine. "Modular andmobile homes account for 30 to 40
percent of all housing starts for newhomes in the 5200,000 and under
range," states Stone. "There are
eight other modular home builders
in the area and four modular housing
factories," says Stone, who proclaims,
"our industry owns that segment of themarket."
How did Schia\'i Homebuilders rise to
the top? "There are two ways to grow
this business: undercut the competi-tion or find a new niche." Stone chose
SCH lAY I
HOMEBUILDERS
the latter and climbed up the ladder
into modular housing. His strategy has
paid off. Stone anticipates that Schia,'iHomebuilders \\ill build ]] 5 to 120
homes in 2007, a 15 percent increase
o\'er 2006, when Stone built 97
homes, achie\'ing 513 million in sales.Most of these new homes will be in
the s300,000 to S500,000 price range
and about 35 percent of them are sec-
ond homes. "It's the best year we'\'e
had in a softer market," says Stone
with a mixture of pride and awe.
One of Stone's biggest frustrations is
the way people ,iew modular housing.
After all, isn't a modular home just a
step up from a mobile home? "They
couldn't be more wrong," exclaims
Stone, whose passion for the topic is
clearly e\'ident. "The precision and
"THE PRECISION AND EFFICIENCY OF FACTORY BUILT,
MODULAR HOMES CAN T BE BEAT. "
AMERICAN BUILDERS QUARTERLY FALL 2007191
SCH IAYIHOM EBUI LDERS
" CUSTOMIZED MODULAR HOUSING ALLOWS
US TO MARRY THE BEST OF BOTH WORLDS. "
efficiency of factory built modularhomes can't be beat," says Stone. "Itallows us to build customized homes
for less money, about 5100 persquare foot."
Stone spends a significant portion of
the company's advertising budget on
spreading the word about customizedmodular homes like the ones Schia\;
Homebuilders builds. Twenty percent
of his budget is dedicated to produc-
ing seven-minute infomercials thatair on local tele\;sion stations, while
another large chunk of money is spenton his Web site.
"We're turnkey builders, which meanswe do it all. We have a number of re-
liable subcontractors that we've used
for many years," Stone says. Heating,
plumbing, electrical, foundations, and
excavation are subcontracted out, but
Schiavi handles general contracting
and carpentry. In fact, subcontrac-tors at Schiavi are treated almost
like employees. Instead of providingtheir own estimates, subs are issued
a work order for the project, which
they can choose to accept or decline.
Stone explains that Schia\; has its own
construction management software
program that enables their estimates
to be so precise-in most cases within
a couple of dollars-that there areno cost overruns. "The bank that we
do business with doesn't even require
921 AMERICAN BUILDERS QUARTERLY fALL 200]
us to pro\;de contingencies an)more,"chuckles Stone.
designed home, but at an affordable
price. One of the services Stone offers
potential home owners is a three-hourconsultation with an architect who
shows them how they can customize a
typical 20 x 40 ranch modular home
to make it uniquely theirs. As Stone
says, "Customized modular housing
allows us to marry the best of both
worlds. " He might just be right. ABQ
Although Schiavi Homebuilders has
four customized high-end modular
homes in the works that are priced at
5750,000 and up, Stone's goal is notto create modular mansions. Stone