Home Builder Has Customer Satisfaction as Its Cornerstone

By Caruthers, Chrystal | Daily Herald (Arlington Heights, IL), November 25, 1998 | Go to article overview

Home Builder Has Customer Satisfaction as Its Cornerstone


Caruthers, Chrystal, Daily Herald (Arlington Heights, IL)


Byline: Chrystal Caruthers Daily Herald Business Writer

Customer satisfaction may be a dying art at many businesses, but not Naperville-based Neumann Homes.

This home builder says it is on a mission to provide buyers with the home of their dreams, at a price they can afford.

Neumann Homes has four communities: Golden Meadow Estates, Maple Brook Estates, Weslake and Wesmere, all in the Plainfield and Bolingbrook area. The company has another 1,400 acres of land under contract in the Northwest suburbs, including land near Del Webb's sprawling Sun City development in Huntley.

To Neumann Homes' credit, a Professional Builder magazine survey shows its on its way to accomplishing that goal.

Its customer satisfaction rating was 91 percent in the fourth quarter of last year, compared to the national average of 76 percent. Its conversion ratio is over 6 percent, or double the national average - that means 6 percent of its prospective home buyers actually buy a house. That is probably due in part to the high number of referrals from previous buyers. The company's 29 percent referral rate is three times the national average. And the company's 9.9 percent contract cancellation rate is half the national average.

All of this has lead the privately owned builder to the top of some of the country's most prized lists. For the second year in a row, it made Inc. magazine's list of the 500 fastest-growing companies. It ranked No. 350 with an annual growth rate of more than 50 percent. And it won the National Housing Quality Gold Award this year.

The company expects to end the year with $103 million in sales, up from $81 million last year. It is the third-largest builder in the Chicago area, selling 578 homes last year. This year, it sold 350 homes by June.

"We're a fast-growing company, and we need people to buy into our culture and grow with us," said Kenneth P. Neumann, chief executive officer of the company.

Neumann employs 104 full-time workers and 15 part-time employees. The goal is to add another 70 people. "Our biggest challenge isn't money, land, or approvals, it's hiring and training great people. That's our limit to growth."

Unlike many builders, Neumann Homes is a production builder modeled after the Fortune 500 businesses known for their proven business formulas. Just as McDonald's sells its franchises and trains its franchise owners to cook french fries at a certain temperature for a given duration, Neumann has implemented that same systematic structure to his home building.

"My dad gave me an incredible passion to do things and do it right the first time," Neumann said. …

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