Time to Take Out the Modular Factory Trash

We’ve all heard the expression “One man’s treasure is another man’s trash.” 

That saying comes to mind when families clean out their parents’ home after they pass away. All the things that parents wanted to save for their children such as Grandma’s assorted plates, the silver plated tea service, picture albums, flatware, bedding, old favorite chairs, etc were unceremoniously either thrown in the dumpster or set aside for the ‘infamous’ estate sale that always seems to follow the last parent’s death. The children have no qualms about throwing out the trash.

Modular factories, both the long established ones and the new ones, are like those parents wanting to hold on to things they believe are treasures that help their business.

But truth be told, if the modular home factory was suddenly sold to an outside investor, all those factory treasures would immediately become suspect.

I can see the new owners walking through the factory they just purchased with an entirely different set of eyes than the ones that vetted the factory’s books, P&L statements and inventory reports.

It doesn’t matter if the eyes are veterans of the modular housing industry or brand new to modular manufacturing they will tear into the trash the former owners left behind.

The first treasure to be thrown on the trash heap will be all the materials that have overgrown the warehouse space such as those 40 cabinets with missing doors, the remains of that special order material that the inventory control person said to keep. What about the carriers in the yards with broken rails and missing wheels and axles with weeds and trees growing through them? Or the third production line that was abandoned in 2008 that now houses materials or an extra space for the returns from service calls.

That was the obvious stuff. Now the new owners begin looking at the production line and procedures. If they had enough money to buy the factory, rest assured they will be throwing outdated and unused equipment in the trash, Then they will look at every procedure at every station on the assembly line asking why it is done this way and what can be dumped, saved or reinvented.

Next will be the systems used by the Sales Manager, Production Manager, Service Department and every other internal system where all those found outdated will be thrown onto the heap to be burned.

Finally they will look begin looking through the biggest potential pile of trash they bought...the people.

The only two people always safe after a purchase by an outside buyer are the receptionist and the CFO. The receptionist position in most factories is not a career choice and the turnover rate is fairly high so it doesn’t make much sense to get rid of them. Besides they are the only person that knows where people hide when the phone rings.

The CFO is safe for at least a couple of months. The new owners need to know who gets paid, who owes them money and where the treasure is buried.

Other than these two and the production line staff and workers, over the next short period of time look for everyone to have their heads put on the chopping block. Even the company’s top salespeople may be sacrificed, at least those that didn’t jump ship to go with another factory and take their builders with them.

The days of a group of upper management people getting together and buying their factory is probably over. Today the it is going to be young techs armed with millions in investment money and new ideas coming out of their butts on a daily basis.

It will be time for the shiny penny to replace the old worn out one.

If you have no intention of selling your modular home factory, throwing out the trash just might be what is required to stay in business. There are plenty of people skilled in modular efficiency ready to help you take out the trash and begin bringing in new procedures and people to once again make your modular home factory that bright new shiny penny.

Don’t put if off too long or the next call just may be from that young woman with a high tech background and $40 million dollars looking to either buy your factory cheap or start building one next to you.

Gary Fleisher is a housing veteran, editor/writer of Modular Home Builder blog and industry speaker/consultant. 

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