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Just Say “Nuts” (Or Something Like That)
Frank Anton/ Frank Talk/ July 2011
I think it’s time for everybody in the housing industry to stop asking the same question. Which is: When will housing really recover? The point is, nobody knows. The best answer I’ve heard — “eventually” — came from high-profile housing economist Mark Zandi, who further explained that demographics would, eventually, rescue housing. For me, that provides scant comfort.
So what should we all do in the meantime?
I suggest this: Think the unthinkable. That is, assume the current dismal state of housing isn’t likely to improve any time soon. Take that as a given, and I think we all have two choices.
One, we can continue to retreat. Even great armies retreat. The Battle of the Bulge is a case in point. In World War II a powerful German army launched a surprise counterattack against an American army rapidly advancing across France, and the Americans gave ground. But at the Belgian village of Bastogne, about 10,000 lightly armed American paratroopers under the command of General Anthony McAuliffe stood their ground … against 120,000 Germans supported by scores of heavy tanks. The German commander asked McAuliffe to surrender. He famously replied, “Nuts” — or, more likely, something far more profane. Eventually reinforcements arrived, and the Americans beat back the Germans.
The point is, you can’t retreat your way to victory.
Which leads to the second choice. That is: stand your ground, assess the situation, then attack. Attack in housing markets that are relatively strong. Attack where the competition is relatively weak. Look to the remodeling market, commercial construction and multifamily development. Introduce new products … and promote them. Support your dealer network. Lose poor performers; hire some stars. Fight for budgets you need to get the job done.
If you decide to attack, you really can’t lose. If the market doesn’t recover, you’ll steal share from competitors in retreat. If it does recover, you’ll have an almost insurmountable head start on the competition.
And if General McAuliffe doesn’t do it for you, remember what Bruce Springsteen sang: “No retreat, baby, no surrender.”
See and hear Frank Anton’s views via our Frank Talk Video Webcast.