Over the past seven years, Stanley Martin has grown 130% — from 368 to 845 closings in 2011 and 2017 respectively. They grew within metro D.C. markets they served and expanded into three others: Richmond and Charlottesville, Virginia and Raleigh, North Carolina. At the same time, sister companies are providing custom, on-your-lot homes and multi-story development projects in their expanding portfolio.
At the end of 2016, Stanley Martin became part of Daiwa House Group, which will undoubtedly bring even more change and new opportunities. Daiwa, the largest homebuilding company in Japan, announced that their USA subsidiary would acquire 82% of the member interests in the privately-owned LLC as a key milestone in their efforts to expand their presence in the U.S.
On October 2, I had the opportunity to visit with Mike Cleary (pictured right) at Stanley Martin’s Reston, Virginia office as they achieved another milestone – 
hitting peak production capacity in their 50-year history. As the company’s Corporate VP of Purchasing, Quality and Safety, Mike was able to share how, through all these years of change and growth, Stanley Martin has maintained its position as a builder of choice.
It all comes down to collaboration.
One thing that hasn’t changed is the value Stanley Martin places on true partnerships. “You need to take a top-down approach and treat your trades and suppliers as part of your team,” Cleary says. “A passion for excellence and ‘doing the right thing’ was instilled by Martin Alloy 50 years ago and continues today.”
Few marriages last fifty years, but one of their original trade partners says it best. “McCrea [Equipment Company] has always been treated with respect and appreciated for what our company brings to the table. Our relationship has matured into a true partnership. From the top down Stanley Martin is a great organization with great people who pride themselves on doing the right thing. They have redefined what working for a builder is. We are not just a contractor; we are truly a ‘Trade Partner’.”
Here are five of Stanley Martin’s good old-fashioned best practices you can leverage in your business.
- CHOOSE PARTNERS WHO SHARE YOUR DNA. “Compatibility in mission, vision and values between you and partners is extremely important.” Mike suggests conducting interviews between your management teams when selecting a new partner. See how they do business. Understand what the risks are and how they look at risk – safety is a good example. Also try to assess their commitment to quality and service. “Quality is easier to assess independently. Be sure to talk to their people to see what resources they have committed to service and the priority they give it day-to-day.”
- RESPECT AND LEVERAGE THEIR EXPERTISE.
Leverage suppliers and distributors’ understanding of the supply chain. Mike recognizes that his suppliers and distributors have a more holistic view of labor and material availability in the marketplace. “Fortunately, we build in a region where distribution is easier. We work with the most premier building distributors in the country – or maybe even the world.” He says that their assistance is invaluable in getting products to market, satisfying lead times and really supplementing the manufacturing process to the highest level. Recognize that trades are the true builders. Collaborate with them and leverage their knowledge – about the market, building systems, and applications of building systems – throughout the design-build process. Work together on cost management and value engineering, so that the end result is a win-win-win for you, your partners and your customers.Collaborate in the evolution of your product. Mike recalled, “When Stanley Martin wanted to deliver a proprietary energy efficiency program in lieu of ENERGY STAR, we worked with 18 different trade partners to define performance standards and scopes of work that would allow us to differentiate ourselves in the Mid-Atlantic region.” They are still working with those trades today on an ongoing basis to evolve the program and provide greater value to their customers.
- SHARE THE WHAT AND WHY OF HOW YOU DO THINGS. The GREEN LIVING program impacts roughly 20-25 different building components from a building science and engineering perspective. “One of the a-ha moments with trades and partners is presenting the program from a whole house integration perspective. People can see it three-dimensionally – how what they do with one component impacts the whole. So, they are better able to sell it and build it.” The company engages its sales and marketing teams, trades and suppliers in GREEN LIVING training on an as needed basis.
- TREAT [YOUR TRADE’S] BUSINESS AS IF IT’S YOUR OWN. In the 10 years Mike has been there, he hasn’t seen one partner declare bankruptcy or resign from their partnership with Stanley Martin – that’s zero out of 100 plus companies. Stanley Martin strategically built the foundation of their company with legacy trade partners. They’ve rewarded those relationships over the years with “good old-fashioned recognition” and a commitment to “preserving the businesses that preserved them during the downturn.” As they continue to grow, they honor their existing commitments, allow partnerships to expand in scale when appropriate and seek new family members as needed.
What’s next? Data-driven efficiency.
“Until recently, we didn’t have the resources to commit to becoming a more technology-driven business,” says Cleary. “We’re truly blessed by the partnership with Daiwa House. It is allowing us to make the financial investment we need to add tools like BIM and advanced scheduling to our portfolio – improving communication and streamlining the design process to become much more operationally efficient.”
“These tools will also help us maximize trade partners’ margins and profitability – which are just as important as ours.”
While Mike toys with the idea of retirement, he’s still too excited about the possibilities that are out there. “I think I have another good 10 years in me.” We hope so!