Four years ago, an epiphany struck P. Thomas Rothrauff as he worked on a presentation for his company's annual conference. As franchise operations president and general manager for Epcon Communities—known then as Epmark—he wanted to clarify the company's position among the big national builders. As he flipped through the slides, absorbing the company's stats within the overall competitive picture, a single question crystallized:
“There weren't many builders in more states than us, not many in more cities than us, but they were building more houses than us,” Rothrauff realized. “Why?”
Quickly, the answer became clear to him. “[These other builders,] they have been in business longer than us and they had a recognizable name,” he remembers. “One of the differences between us and them was they had brand awareness and promoted that and we didn't.”
Armed with a clear idea of what had been lacking in the business strategy, the top brass went to work building a plan to strengthen and advance the company's image and ultimately catapult its growth. Today, Rothrauff and other top management officials are beginning to see the effects of that implementation.
In fact, the company is well on its way toward the goal of establishing franchises in all 50 states by the end of 2010. This year alone, Epcon Communities anticipates expanding its business into a total of 32 states, up from the current 27 states occupied by its 126-franchise network. None of the top 10 builders are active in as many states, according to their Web sites.
And while Epcon's breadth—not its dominance in any single market—has accelerated its growth up to now, expect to see more depth in the coming months. With an affordable, active-adult-targeted product on the market and roughly 75 million boomers around the country, the company is well positioned to close the gap between itself and some of home building's higher ranks.
ALL GROWN UP Launched in central Ohio in 1986 by Edward Bacome and Philip Fankhauser, the company builds single-story condominium communities. Its moderate price point caught on quickly with the boomer generation, fueling sales and pushing the company to begin licensing its designs. By 1995, Bacome and Fankhauser realized they needed to launch a franchising operation to keep up with demand across several states. “It wasn't a deliberate decision to do a franchise; it was a growth in licenses that drove the decision,” Rothrauff explains.
Consequently, the corporate office scrambled to keep pace with license demand rather than focusing on developing a brand image. In the midst of the expansion frenzy, management overlooked one of the fundamental measures used by the most successful franchises in any industry: corporate branding. Unlike McDonald's, Hertz, or Starbucks, many of the home builder franchisees operated under a local brand name—a missed opportunity that Rothrauff says showed a “lack of vision on our part.”
According to Nanette M. Overly, Epcon Communities' director of sales and marketing services, the seemingly disparate brands left target buyers struggling to identify the company consistently in various markets. “We see a number of prospective customers/residents who know they've seen one of our communities, but they are moving to a market they're not sure we are in,” she says. “[Before the name change,] it was difficult to know that [we were in so many places] because franchisees were all building under different names. The customer would have to do a lot of research and leg work [to find that out].”
So the first step in repositioning the company's brand for growth was to wrap up its operations into a single package. Since first quarter 2005, the franchising and development divisions, which previously existed under the labels Epmark and Epcon Group respectively, now fall under the umbrella of Epcon Communities.