Company Report: Winchester Homes
Winchester Homes Winchester Homes is using tried and true business strategy to maintain and grow its business during a down-turn in the housing market...

In March, the U.S. Commerce Department reported that new home sales had fallen sharply in February by nearly 4 percent, which followed an even larger 15.8 point drop in January, the largest in 13 years.
For homebuilders, the last two years have not been exactly as spectacular as the land-rush earlier in the decade, when prices for new homes were on the rise and buyers were coming out of the woodwork.
So what's a homebuilder to do?
If you're Bethesda, Md., based Winchester Homes, weathering rough times requires adhering to the company's principles and straightforward business concepts. For the company, that means relying on economies of scale to affordably produce one-of-a-kind customized homes.
"At the end of the day we are a retail business," says Larry Burrows, president of Winchester Homes, "and, like any really good retail business, you need to know your customer, treat them fairly, provide what they want at a price they feel is fair, and know what your competitors are doing."
According to Burrows, Winchester experienced particularly strong sales in 2004 and 2005. However, in the Metro Washington, D.C. and Baltimore area where the company operates, it noticed toward the end of 2005 and early 2006 that sales had started to slow. "For the majority of 2006 it had been significantly slower than '04 and '05," he says.
To react to the changing market Winchester more heavily promoted its customizing program while introducing newer, fresher products. For example, the company completely redesigned its single family detached home line over the past year. The new designs were based on input the company has received from customers over the past few years and are now incorporated into the basic home design rather than as value added features. The net result is a better product at a lower cost to the customer, Burrows says.
The company is also creating more reasons for prospective customers to choose Winchester Homes. According to Burrows, in the past, homebuilders may have provided some assistance with the closing of a new home, but now are offering incentives of three to five percent of the price of the home. This can be realized in a reduction to the cost of the home, added customization features or upgrades to the home.
The result, says Burrows, is that Winchester has seen its sales increase in the early part of this year and is optimistic that they will have built 450 to 500 homes by the end of 2007.
He adds that building time depends upon how long the customer spends designing their homes, but construction usually takes approximately 100 days. Home prices range from $450,000 to $1.5 million.

Custom Designed, Value Built

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