Chris Stinebert President, Manufactured Housing Institute

Today, there are not Betamax machines available. Instead, VHS has replaced the technology. They perform the same function as the old Betamax, but industry experts agree--VHS picture quality is not as sharp and the size of the recorder and tapes are too large.

So, the question remains . . . how could a superior product with a competitive edge have its market share plummet from 100 percent to zero in eight years? And, more importantly to the manufactured housing industry, what valuable lessons can we learn from Sony's failure?

Building homes in the factory is a superior construction process to "on-site" construction. The inherent efficiencies in time, quality controls and affordability are indisputable and the retail distribution system is the envy of the homebuilders and retailors alike. In fact, a potential homeowner is often approved for a loan in under an hour, instead of the two weeks to a month for a mortgage.

But, just as Sony did not recognize its weaknesses in time to initiate necessary changes, the man ufactured housing industry must use this time to self assess its flaws or risk further loss of market share.

Priority #1: Become customer driven. This means basing sales strategy on customer needs instead of on price and competition.

The recent downturn in shipments and sales has taught us a stark lesson--business as usual simply doesn't work. Incentives based on shipments and inventory growth instead of sales is foolish. Bottom fishing to build financial market share is reckless. And, being the cheapest is not always the avenue to long-term growth and profitability.

Priority #2: Share information with your peers! Although some companies believe that withholding their company specific information and statistics give them a step-up on their competition, in reality, this practice has the opposite result. Good, sound business decisions come from accurate and timely information. Without the facts, we are shooting from the hip.

Priority #3: Do the right thing! This is by far the toughest. This means not responding in kind to your competition when you know their business practices are risky and imprudent. It means repairing your homeowner's leaky roof when you are not responsible. It means staying out of the self-destructive cycles that have plagued this industry since its inception.

© 2000 by Manufactured Housing Institute. All rights reserved.