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April 2021 #13261 Page #106
Defining a Modular Factory’s Capacity is Complicated
By Gary Fleisher
O
ne of the words most often heard when talking about the modular construction industry is “capacity.” Webster defines it as “the amount that something can produce.” Somehow that just doesn’t seem like the right definition for modular construction.
One of the standard questions I ask when visiting a modular factory is, “How many line moves can you do in a week?” – and this is where the idea of exactly what capacity means changes. Some factories can produce almost 50 line moves per week while others barely do three. Both of these factories are talking about their maximum capacity, but in reality that number might have only been obtained a couple of times in the company’s history. There are many factors affecting a factory’s capacity, including who the factory is supplying, what they are supplying, and how they supply it.
“Who” is buying modular today? To start, the “who” they supply can have a tremendous influence on capacity. Today’s modular construction buyer ranges from the single-family home builder, to hotels wanting the speed of using modular, and all the way to medical care units for COVID-19. Looking at the factories from coast to coast, you will find the East Coast modular factories began decades ago building single-family homes. I talked with one factory that supplied 350 ranch and Cape Cod homes in one year for a developer in PA. That may seem like a lot of line moves, but in actuality it was 700 or just 14 per week, and that capacity has never been reached since. In addition to those 700 modules, the factory also delivered, set, and completely finished each home. Now that 700 capacity takes on an entirely new perspective. The East Coast factories were and still are “Kings of the Custom Single-Family Modular Home,” relying on an army of small to medium custom modular home builders. But, multifamily and commercial is creeping into those older factories and the new ones planned for the East will probably never produce a single-family home. The Middle of the country is a mixed bag of solid single-family IRC homes, manufactured HUD homes, and commercial project modular factories. Their legacy of building affordable housing for mid-America is legend. A majority of the capacity for these factories is being sold to dealers that stock manufactured homes and also take orders for modular homes. Continued next page
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