“Epcon would be a part of my portfolio. It might be a new way of building for you moving forward, because we’ve heard that from Franchise Builders that are already working with us. They were complete custom — they’re going complete Epcon.”
Host: Ryan, when you talk to and deal with franchise builders around the country, from your perspective, what is most important trait that is necessary for an Epcon Franchise Builder?
Ryan Braet, VP of Purchasing at Epcon Communities: Construction experience, previous building experiences, is really important. We’ve dealt sometimes with a few people in the past years that didn’t have it, and it’s a little bit tougher. Having that experience is tremendous, on the front end.
Host: I appreciate that. I was curious if you could tell us a little bit about your professional background in the home building space or out.
Ryan: No problem. I actually got the opportunity to start building houses for my father‑in‑law right out of college. I did it for about seven years, kind of was a one‑man band. We did infill lots all around Columbus. It would be maybe 10 to 12 a year.
I got the experience of everything, whether it was working with the architect, getting basically the permits and working with the municipalities. Sometimes we’d have to get zoning variances. I had a little bit of experience in everything.
That was my start. It was definitely a passion. Then I joined a pretty big builder here in Columbus, Ohio, that started private and went public. I got to experience that and I think spent 17-18 years there. Then I did a little bit of multifamily building for an apartment builder here in Columbus, Ohio. I ended up at Epcon Communities about nine years ago.
Host: You’ve seen the industry from all different levels, all different perspectives. That’s really got to be a great experience for you as you’re dealing with builders all over the country.
Ryan: Definitely. In fact, I actually did do a couple of years of sales for a local builder. I did that purposely to understand what that part of the business does. The whole idea is to round yourself as well as you can to understand this industry from top to bottom.
Host: Absolutely. What brought you to Epcon? What was it about the opportunity that you saw?
Ryan: I did the multifamily apartment building for a couple of years. I was actually getting ready to take another job with another multi‑builder because it’s not as set in stone schedule‑wise. You might have a couple projects, and it’s kind of unpredictable.
I got the opportunity to interview with Epcon after I pretty much already got an offer from a multi‑family. Going back into residential construction and during the interview, I got goosebumps. I had already studied Epcon’s plans, to be honest. I was excited.
The one thing I will say with Epcon that was probably the most appealing was the number of house plans. A lot of big builders, every time you start a new community, you have to have seven plans with five elevations, and maybe three or four of them build or sell.
We have the three. It’s the meat and potatoes of our company, the three top plans that sell. Everybody sells them. That’s the side courtyard — it’s very unique. You don’t see any other builders in the country that have this product. That’s really what sets us apart.
Host: Keeping it simple is where you’re going with that. We have a set number of plans. There’s a lot of variety to it around the country. Everybody’s basically building the same product. There’s a lot of years behind it that we know it’s going to work well.
Ryan: Definitely. The density that you get off of our floor plans and the privacy that it creates, it pretty much sells itself. It’s one of those things that we start way ahead just by our floor plans compared to a lot of builders. It sets us apart.
Host: You’re the Vice President of Purchasing for Epcon. Can you talk a little bit about what that means for your role within the company and the things that you do?
Ryan: Sure. My main job is vertical construction of maintaining pricing. I started as a director. I got promoted to VP a few years ago. That also got me involved with the early‑on national accounts.
We had a national account program when I started but it wasn’t the strongest. We’ve created a pretty strong network for both our corporate and our franchises to be able to use our national account program. The bulk of mine is definitely vertical cost; that’s what I’m responsible for.
Host: National accounts programs — not every builder has one of those. Would that be fair to say?
Ryan: Correct. When I started, we had a third party that we went through and it was kind of crazy. There’s a lot of them out there. You have to understand they take a piece of that pie that you’re collecting on rebates. They are definitely generating. So to bring it in‑house was a huge thing. The idea is the more we have worked together as a group, the better pricing we get. What I’ll say is, beyond even pricing, it’s that partnership that we create with manufacturers.
Some of them create their own exclusivity. We don’t go after exclusive partnerships. If there’s somebody out there that truly works hard and takes care of Epcon and Epcon Franchises, it creates its own exclusivity.
Host: When you go out and talk to our Franchise Builders and you talk about our national account program, what do you say to them? What are the questions that they ask you?
Ryan: We do try to have two to three of the top different manufacturers in each trade. That’s the goal. The reality is not every manufacturer’s going to work across the country. A lot of times, it is location‑driven. That makes us say, “OK, it might not be working in corporate, but there’s enough franchises out there. We have to put together a national account agreement.”
What we try to do with them at that point is have them participate with a couple different things we do. First, we try to establish some kind of price protection annually, whether it could be a two to three percent max. That’s something that we try to do. Supply where they’ll be able to maintain and take care of all builders is the way I look at it.
Some of those went out the window in the last few years during the pandemic. It was a little bit of a scramble. That created the, “OK, we have to diversify. We have to have a couple different choices.” If you have one and that one doesn’t perform, it’s a waste at that point. To me, the bulk of this is the national account program is very easy.
When I say our Franchise Builders, what they do is quarterly turn in their closings. They do that every month anyhow. There’s a small survey that we send out and make sure that there’s a few options, whether it might be flooring, or HVAC equipment, things like that—fireplaces—that they have to have more detail.
It’s something that would probably take not even 30 minutes to complete. We do the rest of the work. We collect it. Then they get a rebate check. Right now, we’re paying them out biannually is what our goal is.
Host: Any other things that stand out to you as far as our national accounts program or the rebate program that would matter?
Ryan: We always try to have them participate. We have a franchise conference every year. They’re a huge support of that whole conference. When they participate, part of their fee goes towards that.
The other part is marketing. We ask them to help because if it’s in alliance with us and we’re using them, it’s nice. Brand recognition is huge.
Host: We also don’t force our builders to use the products that are in our national account program. Is that correct?
Ryan: Correct. Exactly. That’s why we have to ask our Franchise Builders, “OK, if we periodically do a survey and find something that there’s a good chunk of the builders that are using it…” That’s something that we’ll go after, and work on, and put together a program so it would benefit those builders that are using that manufacturer.
Host: If you were talking to a builder that currently doesn’t have a national account program or account partner program, what advice would you give to them?
Ryan: I definitely think you need to participate. It’s one of those things. It’s really important. It’s like the importance of a smaller builder networking. It’s a network within, which benefits all different things. It’s no different than being part of your local building industry association.
Jumping on and taking part of our rebate program, national account partners, it’s really simple. Typically, what happens is, the first time you start your community, you’re not going to change the materials that you’re using. You’ll build out that whole community. It’s us tracking your closings. That’s all it is.
There might be a few specifics, like I said earlier. The other part of the work is us. For somebody else to try to do that on their own, there might be some deals out there they can get. Depending on where you are — it still even happens to us on the corporate side when we go into a new region — what happens is you’re following the biggest builder in that city.
A lot of times, if you’re trying to buy a certain brand window, all of a sudden that price is much higher than what we typically pay anywhere else because that supplier does not want to carry another window. They drive that. That’s the stuff that we have to be aware of.
When you’re part of our program, I reach out to our partners and I say, “Hey, what’s going on here? Help us out. Tell me where I can get the same window that we’re supplying everywhere else at a competitive price that’s within reason. It’s not blown out of proportion.”
Host: That gets into purchasing power.
Host: If you’re a solopreneur home builder and you’re the only one buying these windows, your manufacturer, your supplier’s only going to be able to supply a certain discount. But being part of a network, there’s probably much greater purchasing power at that point.
Ryan: Exactly. Numbers count. That’s what these manufacturers, when you come to the table with units of closings and they know that they’re going to be putting that into our houses or we’re going to be using their product, that’s what makes the big difference. The more the merrier is usually it.
Host: In the end, it allows you to control your costs more and be more competitive with larger builders that might be in your market. I would think, from a custom builder that’s only building so many homes a year, that’s something that they don’t even consider. When there are custom builders going up against a production builder, how do they be more competitive in that space?
Ryan: Typically, that’s probably the case there. What happens is, what plumber they’re using might dictate what fixture they’re going to use, whether it’s a Moen or a Delta. That’s exactly what happens.
They go in and they have their favorite plumber. He’s like, “Well, this is what I use. I can get this at the best price for you.” It’s going off of who’s doing their work for them.
Host: You’re an individual builder and you’re thinking about building your own purchasing program. What are the pitfalls? What are the things they’ve got to be leery of if they try to do it alone?
Ryan: If you’re trying to do something on your own like that, the biggest thing is you could get stuck being the same as the next biggest builder in your city or in your region all of a sudden because that’s what that vendor is using. Again, they’re getting the best price because they make more money the more they sell, like everybody else.
When Epcon says, “OK, you’re getting Epcon pricing,” we establish that. There’s a difference. Even here locally when I’ve brought on new trades and they say, “OK, well, I use brand X,” I’m like, “OK, well, hang on. Can you talk to our national rep?” All of a sudden, things change. They’re like, “I got the price. This is good pricing.”
Guess what happens? They start selling that as one of their top sellers. That’s the whole part of working as a team, it makes a lot of difference. The more units, the better the pricing, the stronger the relationship. It works. It’s a win for everybody.
Host: That’s great advice and great things to think about in that regard. I’d like to switch gears a little bit away from necessarily purchasing but the home building industry as a whole.
You and I talk about technology and future‑looking things within the industry. From your perspective, what do you see coming? What’s coming in the home building industry? How are things going to be changing in the next year, or five years?
Ryan: I have four kids. I might have one moving back in with me. My parents are older. They’re trying to figure out where they need to live. If they live right next to you but in a different unit on your property, something like that where you could look out for them — it’s that generational living is going to become a big thing.
Lot sizes are one thing, but this could pay for itself and create value to a lot of people. Sometimes, you have to look beyond that. But, I would have to say one of those things is we have to look at different product and how it can apply to generational living.
Host: Affordability and attainability, they’ve been buzzwords out there in the industry for a number of years now. I don’t know if anybody’s locked in on how to answer that. Across the country, it continues to be an issue that needs to be addressed.
Ryan: Right now, townhomes is something new for us. Columbus is kind of like the test kitchen here. To me, they’re a no‑brainer in a place like Raleigh where the land is so much more expensive than in Columbus, Ohio. It proved itself.
We’re looking at really small plans right now. We’re going to call them the Cottage Series. It’s fairly small, it’s our smallest product that we’re going to be coming out with. It’s something as far as diversification and a price point is what we’re trying to achieve with that.
Host: Density is one way to address affordability. Absolutely. Build smaller units or more in a smaller space. There’s also the way you build them. Modular is coming into play. 3D printing is coming into play, robotics, all these technologies are evolving, that they’re starting to come at it from lowering the cost of the production of the house as well.
Ryan: Those are all really interesting. The big hurdle here in the United States would be the government because in other parts of the world that they already do that, they make it where it’s easier for the builder to do that stuff.
That’s the idea of how it has gone. It used to be 6 to 12 months. If you went back 25 years ago, you could have something, buy a piece of property, and be building on it. Now, it’s double that. In certain areas, it’s triple that just depending on where you’re at.
Host: So the builders themselves can be innovative and try to be forward‑thinking to bring costs down.
Host: But the government regulations and the things that go with that have to be adjusted to make that possible.
Ryan: Correct. Typically, when you do try a new way of building, you have to get the government or the local municipality approval and get them involved with it. I think that’s why it’d be a tougher one, but I’m all for it. I’m excited about it, and that’s the direction.
Itemization is a huge part of trying to save dollars, and that’s the direction we’re going is trying to itemize all our quantities. A lot of builders do lump sum purchasing and that’s great, but still, our next step is trying to itemize everything, where we have exact quantities.
Really all you’re going to be negotiating at that point is your waste because there’s going to be waste on almost any materials you’re building with. The other idea behind that — it scares a lot of vendors and contractors — but the idea behind it is we’re helping them do their own work. Sometimes there’s contractors out there that might not be the best businesspeople.
The fact that if we can help them and say, “OK, here’s what we’re coming up with.” Whether it’s framing materials, studs, or how many shingles, whatever it is, then let’s identify what’s the waste and agree upon it. If we have to build a sample of 10 houses and then take a look at it and make some adjustments, it’s a win for everybody. That’s really the route.
Host: The things you’re sharing speak into what the Epcon network’s all about. There’s a lot of education. How do you become a better builder? How do we teach you the things that we’ve learned over the years and bring that to your home building business?
Ryan: Correct. That’s the ultimate. The goal is always to be better. We want to lead. We don’t want to follow within the building industry. We want people to say, “Oh, look at that builder. He’s using the Huber ZIP.”
That was the other thing — when I first started, there was hardly any builders in the city, nine years ago, that used ZIP. Now, I’d say majority of builders that are somewhat production custom or higher end, you see ZIP everywhere. I take those as compliments. I truly do. It’s one of those things. Epcon was using it before I came on board. It was one of the reasons I got excited about working for Epcon. You can see the difference of why they use products.
Everybody’s going to say that it costs a little bit more. Guess what? Compared to a house wrap, we haven’t seen any kind of water intrusion at all. It’s huge. It pays for itself. The extra money that you have into it is well worth a house wrap that. I’ve used that for years. I’ve used it on my personal houses. After you have the mechanical trades go through it and you have cuts, or slices, or the wind, or a storm, typically, they do not get patched and sealed correctly at all.
Host: Where I think you’re speaking to is the innovation that the company brings being a leader in trying new things and not being afraid.
Ryan: Correct. Exactly.
Host: If we wanted to wrap things up, you’re speaking to a builder out there that’s growing, evolving, and they’re wanting to grow or diversify their business, what’s the advice that you would bring to them?
Ryan: Me, personally, Epcon would be part of my portfolio. It doesn’t have to be 100 percent, but you have to give us a chance, take our plans, put together a small community, try our product.
It might be a new way of building for you moving forward, because we’ve already heard that from franchisees that are already working with us. They were complete custom — they’re going complete Epcon. There’s huge advantages, it will probably make your life easier.
The big thing that we always tell everybody, and we haven’t done it since I’ve been here, is we don’t make customizations. We keep our plans. That is a part of it. The less you change our plans, the better you are. Because if I’m putting together a lumber package deal with a certain company, and I can say they’re building the exact same product as me, you’re going to get the same benefits that we’re going to get, because they’re going to be out there.
That’s what we’re working on right now. That will be a huge benefit. If you’re the builder out there that makes customization and changes, it’s going to be hard for you to fit into that mold of what we’re doing. It goes right back to the simplicity again.
This is what you’re buying, this is what you get. If this isn’t right for you, then you could go to the custom. Headaches come for the builder, and even the buyer because sometimes things don’t work out because it’s a custom house.
Host: The more you say, “yes,” to your customer, the more likely it is you’re losing revenue.
Ryan: Revenue, correct. Yes. That’s the other part. Typically, if you haven’t built it, your first couple of times might be a practice. The idea is, we know what we’re building. We know what we’re going to make on options. That’s the idea behind doing this not as a practice, but to make money.
Host: Follow the recipe that’s already been established.
Host: Well, thank you, Ryan. I appreciate you joining us today.
Ryan: Thank you.