As an independent home builder, managing costs effectively is crucial for both maintaining profitability and ensuring customer satisfaction. Whether you’re a cost plus builder who focuses on transparency and detailed expense tracking or a fixed price builder dedicated to staying on budget, CBUSA’s group purchasing organization offers advantages tailored to fit your specific needs.
Here’s how CBUSA can be a game-changer for your business – no matter which contract type you use.
For cost plus builders: Enhancing cost management and client trust
Cost plus builders operate on a model where clients pay the actual costs of construction plus a fee. This contract model relies heavily on the transparency and trust built between builders and their clients. Homeowners want to see where every dollar is spent – and CBUSA makes it easy.
“For us as cost plus builders, I still see it as an incredible winning scenario,” said Adam Shaeffer, co-owner of Cardinal Crest Homes. “Yes, with cost plus you can make more money if the customer spends more money. But I think of it differently. If I can lower the cost of my home, I’m going to be more competitive, and I’m going to land more jobs.”
Group purchasing power
CBUSA brings together a network of builders, creating a collective buying force. By leveraging this group purchasing power, cost plus builders can secure lower prices on materials and supplies. This reduction in material expenses directly benefits your clients, as the savings are passed on to them. Lower material costs mean you can offer competitive project pricing while maintaining healthy profit margins.
Streamlined procurement
With CBUSA, the procurement process becomes more efficient. Our experts negotiate with suppliers for you to ensure you receive the best possible deals, terms of service and priority over other companies. This simplified process enhances your ability to manage costs effectively and ensures materials are available when you need them – keeping projects on track.
Improved transparency and accountability
As a member of CBUSA, you gain access to detailed purchase records and pricing data. This transparency allows you to provide your clients with clear and accurate cost breakdowns, which fosters a greater level of trust. Clients appreciate knowing they’re benefiting from negotiated discounts, and they’ll see the value of getting the same high-end products at a lower price point.
Back-end rebates
Over the last 20 years, CBUSA has been establishing and maintaining strong relationships with suppliers to ensure reliable access to high-quality materials for its members. For cost plus builders, this means you can confidently promise superior products at a lower cost and timely project completion, further building client trust and satisfaction.
For fixed price builders: Maintaining budgets and reducing risk
Fixed price builders commit to delivering projects within a set budget, which requires meticulous cost control and foresight. CBUSA offers several key benefits to help you achieve this.
“Committed buys provide us with cost protection and the ability to project where our numbers are going to be,” said Steven Sanders-Myers, purchasing manager at Brightwater Homes. “We’re able to lock in budgets further out than we could if we’re trying to run this on our own. We can also track in the interim to prepare ourselves, so if there’s going to be an increase or decrease, we know what it’s going to be before it hits.”
Consistent, competitive pricing
By joining CBUSA, fixed price builders gain access to negotiated pricing and committed buys that keep costs consistent over a set period of time. This stability in material costs helps you plan and price projects accurately, reducing the risk of budget overruns. Knowing you can rely on competitive pricing allows you to confidently bid on projects and manage client expectations.
Fewer cost overruns
One of the biggest challenges for fixed price builders is the risk of unexpected cost increases. CBUSA helps to minimize this risk by locking in favorable pricing agreements with suppliers ahead of time. With predictable material costs, you can mitigate the impact of price fluctuations and protect your profit margins.
Access to quality resources
CBUSA’s network includes a wide range of trusted suppliers who deliver high-quality materials and products. Fixed price builders can ensure that every project meets their standard of excellence without compromising on budget. Access to top-tier resources at negotiated rates means you can deliver exceptional value to your clients without financial strain.
Supply chain management
Efficient supply chain management is critical for staying on budget. CBUSA standardizes the procurement process, which reduces lead times and minimizes delays. This efficiency translates into smoother project timelines, fewer unexpected expenses and less delays – helping you stay within your fixed price commitments.
For cost plus and fixed price builders: The benefit of back-end rebates
An additional advantage for cost plus and fixed price builders is the potential to earn rebates through CBUSA’s partnerships with leading brand partners.
“There’s also the rebate on the backend, and that’s what we’re really interested in,” Adam said. “If I’m purchasing materials or if I’m purchasing a service from a subcontractor, it’s incredible to be rewarded for the money you’re spending.”
As you purchase materials at negotiated prices, you can accumulate rebates from suppliers based on your purchase volume. These rebates can be a significant source of additional income or savings. You can choose to pass these rebates on to your clients as further savings, enhancing their perception of value, or reinvest them into your business for growth and development.
At the end of the day, rebates add another financial benefit for builders using either contract type.
Ready to enhance your construction business with the benefits of CBUSA?
Whether you’re a cost plus or fixed price builder, CBUSA’s benefits can transform your business. By leveraging the power of group purchasing, securing consistent, competitive pricing and enhancing your procurement process, CBUSA can help you manage costs more effectively, reduce risks and deliver exceptional value to your clients.
Embrace the benefits of our group purchasing network and elevate your home building business to new heights. With CBUSA by your side, you can build with confidence, knowing you have the resources and support to succeed – no matter how you plan your projects.
Send us an inquiry today to apply for membership.
