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"Tiny" Homes and Battling Homelessness

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Global Marketing Team

24 November 2017

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Table of Contents

2--------------------------------------------------------------------------------------------------Business Plan

3------------------------------------------------------------------------------------------------Company Goals

3-----------------------------------------------------------------------------------------------Customer Needs

4----------------------------------------------------------------------------------------------Pricing and Plans

4----------------------------------------------------------------------------------------------------Competition

5------------------------------------------------------------------------------------------------Marketing Plan

5-----------------------------------------------------------------------------------------------------------Trends

6---------------------------------------------------------------------------------------------HR Requirements

7--------------------------------------------------------------------------------------------------------Timeline

7----------------------------------------------------------------------------Success and ways of Measuring

9----------------------------------------------------------------------Work Cited/ Supporting Documents

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Marketing Plan

Part 1--Synopsis

Homelessness is a huge problem throughout the United States. One market that hasn't

been explored very much in trying to solve this problem is "tiny" homes and the good that they

can do to help combat homelessness in crowded cities. Tiny homes can lead to a less

impoverished country and eventually, a less impoverished globe. The term “tiny” home refers to

a house that is fully liveable while only being about 400 square-feet in size (The Tiny

Life).These houses can help those in a financial disadvantage get back on their feet through

lower cost and lower mortgage. One area of growing poverty and homelessness where building

“tiny” houses could be an effective solution is the city of Fresno, California with 1572 homeless

people (Hoggard) who could be helped through access to affordable living. The growing

numbers of homeless don't have enough shelter and is said to have 1351 of the 1572 people not

sleeping in a shelter (Hoggard).

With the large need for affordable living in many areas of the United States, "tiny" homes

will soon become a national phenomenon, sweeping the nation with cheap houses for everyone.

The main problem with these houses would be the zoning problems around the United States.

While Fresno allows houses with smaller square feet on wheels, other places such as New York

stick to the old zoning regulations which leads to legal conflicts. However, with the media

frenzy of tiny houses, many of these zoning laws are being called into question. Fresno would be

a great launching point to go international because if we are successful in showing that "tiny"

homes can make a difference and combat poverty this would launch "tiny" homes to the forefront

of industry and manufacturing.

To expand locally, "tiny" homes would have to be brought to the attention of Fresno,

California's politicians and local homeless shelters. The start would be based off community

support and a drive to get those people back on their feet setting up tiny house communities.

These communities would help with homeless people getting back to and transitioning to more

standard living arrangement. Because the communities would be from private non-profits or the

community, we would to maximize the number of people helped in the Fresno area by making a

sliding pay scale for rent based on annual income or sending them to another tiny home

community in which they can purchase their own tiny home.. Also, because of the growing

poverty rate in Fresno, more people will be turning to cheap alternatives to a normal house. To

do this, we would have to making efficient and affordable houses that lead to both profit and

helping people. The houses would average around 350 square feet each and would be available

to everyone for an affordable price.

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Part II--Company Goals

Through this endeavor, we want to provide affordable living for underprivileged people

in the Fresno, California area. We also want to expand to a global market and produce "tiny"

homes around the world. In the Fresno area we want to stop the growth of homelessness and

bring the number of homeless civilians below 750 people. We also want to help provide a cheap

alternative to a property and house in the “tiny” home.

The internationals company goals are to provide affordable houses around the world

focusing in on third world countries where living standards are very low, allowing for

exponential growth and massive business ventures. The company's goal is to gain a national

following through the Fresno, California business venture leading to global expansion. After

helping with the underprivileged in Fresno, the company could expand to cater to those more

fortunate with higher end and luxury "tiny" homes.

Part III--Description of Customers and Their Needs

Our target demographic would ideally be poor or underprivileged homeless people living

in the Fresno area, mainly focusing on small families, elderly, and students who make up the

majority of the homeless and low income population. After the venture in the Fresno area we

could expand to target both the low income families and the higher income families by designing

more luxury and more expensive tiny homes. On a survey from the American Tiny House

Association, it shows that most respondents that were interested in tiny homes were from the

range of 46 to 65 (American Tiny House Association). This graphic shows that we should target

older people that, when closer to retirement, are more interested in the prospect of tiny homes.

The target demographic is the low income, older, smaller families of Fresno, California.

With this demographic, the customer will need an affordable living space that can fit the

family. Many people have turned to the tiny home alternative and been much better off leading

to a more frugal lifestyle and joining the tiny home movement. The needs of our customers are

our number priority and helping people to get into affordable living spaces is the best way tiny

homes can combat homelessness.

Other considerations in the global market are communication, traditions, and buying

habits. First, the communication through the globe are affected because the third world countries

that are our target demographic are less exposed to the idea of tiny homes due to lack of

knowledge of the show “Tiny Homes” and its internet following. However, the prospect of living

in smaller homes are normal to third world countries where living standards are much lower than

a developed country like the United States. Also, the culture and traditions of these third world

countries like India are vastly different than the United States' culture of capitalism. However,

many families live with extended families like in India and are accustomed to smaller living

quarters making tiny homes a perfect, cheap alternative to homeless shelters.

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Part IV--Pricing Strategy

With us targeting low income families from the Fresno, California area, we want to cut

back as much as we can to provide affordable living. The cost of living in an one bedroom

furnished apartment in Fresno can be as much as $1089 per month (Expatistan). While most

people lease land to live on that cost can be as low as $20 per month (Vickers). The cheap price

for land allows for cheap houses and still get a profit. The cost to make a cost effective tiny

house would be approximately $7000 according to a recent article by Tinyhousebuild.com and

this is a one time price. The goal would be to make tiny home communities for the Fresno

populations.

The costs of the tiny homes would come from lumber for the frame and the house, steel

for the trailer, and various home appliances that add to the cost. Some of the variables are prices

for steel and lumber that fluctuate while factory prices and building cost should remain the same.

The break even point of our tiny home communities would be $7020 for the first month of living

in a tiny home. Payment plans could instituted with a range of 15 year plans with 3.3% fixed

interest to a 5 year plan with 2.5% fixed interest rate. It would also have a downpayment of 20%

coming out to $1600. The standard markup for a house is around 17% meaning our houses

would cost $8190 with the standard markup. The cost to live for the first year with a 5 year plan

is $21,480 with $358 monthly payment. These numbers are compared to the $1516 that the

average citizen of Fresno pays with a mortgage. The second half our finances for our plan

involves the city stepping in and helping homeless get back by setting up communities of houses

and being a new type of homeless shelter. These communities would ideally be set up with 15

houses each and cost $122,850 to build and implement for the city.

Part V--Competition

With Fresno, California allowing tiny homes through the policy of square footage

allowance, there are some tiny homes but only personal owners. We would be the first

corporation that expands to the Fresno, California area. However, once the endeavor succeeds

many other corporations. One major way the corporations can become competition would be

making tiny home neighborhoods by buying a plot of land and filling them with tiny homes.

This competition could be used to our advantage by using those tiny neighborhoods as a

filtering system for the homeless after the nonprofit community. These neighborhoods can be

made from our homes produced in factories owned by us. The growth from other corporations

would lead to more growth for our company by making tiny homes a new trend in the United

States and the rest of the world. The place for our company would be a step into a new market in

the Fresno area.

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Part VI--Marketing Mix

Marketing mix for Tiny homes are made of four major factors. Promotion, product, place,

and price. The promotion of the tiny homes should be through the city officials as a help to

homeless and low income families. The promotion also is shown through the tv show Tiny

Homes. The tv show details the process of building tiny homes. The next step is the product, a

tiny home is a full house condensed to a much smaller footprint. The tiny house compromises no

features of a house except for space.

The second half of marketing mix is the place, Fresno, California, which vitally needs a

cheap alternative to housing for the growing population of homeless and low income families.

Also the policy of allowing "tiny" homes on wheels as a permanent dwelling (Khokha) has

opened up many possibilities for new homeless shelters. These new policies make living much

more affordable. As a Fresno “tiny” home resident Cheryl Spencer says “[t]his is ideal, a way a

lot of people could afford a home otherwise couldn't” (Khokha). Finally, the price of the houses

is very affordable and allows for many people to buy these houses. Also, the houses allow for

many to built out of a factory for a reduced price because of the optimization from factories.

Each house, as discussed in the pricing strategy, would cost $8190 to build with various plans to

pay them off.

Part VII--Economic, social, legal, technological trends

The economic trend that is leading to more tiny homes is that the price of the supplies

that build tiny homes are dropping. Lumber prices are down and the house is becoming more

cost effective (Woodworking Network). Also, average income of a house in Fresno, California

is going down while the rate of poverty is going up meaning they need a cheap alternative to

standard living and tiny houses could be the solution.

The social trend that is leading to tiny homes is society's push to smaller families

meaning that each family needs less square footage to live comfortably. The average size of

families in the Fresno, California is 3.17 people per household according to the United States

Census (QuickFacts). Another trend is the growing number of persons in poverty which has

grown to 25.5 percent according to the United States Census (QuickFacts).

The legal trend that is leading to more tiny homes is the policy change in Fresno,

California that gives code authorization to tiny homes on wheels (Khokha). This policy change

will lead to a growth of tiny homes. Many tiny home communities outside of Fresno and a select

other places are in contention with the law because of zoning laws. These legal changes and

trends allow for more tiny home communities and less restrictions.

Technological trends that are leading to cheaper tiny homes are the innovations in the

lumber industry and advances in energy. First, the lumber industry is evolving to an “Industry

4.0” as discussed in an article by Woodworking Network (Woodworking Network). The article

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says that “Industry 4.0” allows for factories and automatic production to make the same quality

of work as custom woodworkers today. This means that lumber and custom jobs are now

significantly cheaper allowing for more units being made for the tiny home communities. Also,

many tiny homes use solar panels to power the home because new units can be wholly powered

for less by a small number of solar panels. This shows that the tiny home model can also be

energy efficient and help the environment. The energy improvement allows for cheaper

electricity bill or cheap green alternatives for tiny homes.

Part VIII--Human Resource Management

Implementing these tiny home communities requires a variety of skill. First, factory

workers and supervisors are needed to make materials such as lumber and steel which are used to

build the houses. Next, you need electricians and plumbers to wire and insulate the houses.

Finally, you need contractors and builders that will build the houses and make them livable.

Upper level management is the CEO and the board of directors that oversee the entire

corporation and make executive decisions. The CEO should be an experienced businessman that

has a MBA and company experience and are able to focus on big picture ideas and make

executive decisions. Also, the COO is the one who deals with mid level managers and takes

information to the CEO, the COO should be just as qualified as the CEO with a degree and a

strong base in the company. The next level of upper management is the vice presidents that all

preside over one area of the company like marketing and human resources. These high end

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officers of the company should also have a degree in their particular field of study and have

years of experience.

Also included in higher level management is projects managers and public relations

officers. These both require degrees and people skills and being able to make decisions that

affect many people. These officers would work directly with city officials and outside business

to get the tiny home communities off the ground.

Next, is mid level managers that deal with day to day interactions and would focus on

certain tiny home communities and manage only the people in that community. The managers

would need to have work experience and have a foundation in business and financing. These mid

level managers would work over sales representatives of the company that have a realty license,

knowledge of the market, and work experience. Also they would work with contractors that build

and deliver our tiny homes.

The contractors would have work experience and a manager that knows financing along

with manual labor builders that would assemble the houses. These manual labor workers could

have minimal work experience.

Part IX--Marketing Timeline

The timeline we are proposing will be bold, but it will produce the best results. We intend

to invest in building five tiny homes in the first four months. The construction time to build a

tiny house is two to three months. While the homes are being built we will be able to sell them to

the right families and people in need.

After we get these families in need and they are paying their bills, we will have enough

profit to start building five new tiny homes in the same neighborhood. This will take another two

to three months and by the time the construction is done on the next houses we will already be

eight months into our plan.

After all ten houses are up and running we will wait another three months to build more

tiny homes in the same location. We will need to build up or profit for our big closer on the plot

of land we are on. At eleven months we will invest in ten more homes. The construction of

theses houses will take five months. After it is all done we will be fifteen months into our big

plan with twenty homes. We could be housing sixty plus people in this one complex. This will

help the people in need as well as helping Fresno, California look nicer.

Part X--Measuring Success

The best way for us to determine if we have been successful with our marketing plan and

business is to follow our marketing timeline exactly and see if we have achieved our goals for

the fifteen months that we have planned out. If we do complete our goals in that amount of time,

we will work on setting a timeline for completing our overall goal of bringing the homeless

population of Fresno under 750 people by providing them with affordable housing. If we do

complete that goal, we will know that our marketing plan has been successful and we can work

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on expanding our business globally to provide cheap houses for homeless people around the

world and building more luxury tiny houses for clients who are more fortunate so we can grow

our business and make it more successful.

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Works Cited

“Cost of Living in Fresno, California, United States. Nov 2017 prices in Fresno, California.”

Expatistan, cost of living comparisons , www.expatistan.com/cost-of-living/fresno.

Accessed 25 Nov. 2017.

Hoggard, Corin. “Fresno homeless population increases, no shelter available for most.” ABC30

Fresno , 16 Aug. 2017,

abc30.com/politics/fresno-homeless-population-increases-no-shelter-available-for-most/2

316023/. Accessed 25 Nov. 2017.

Khokha, Sasha. “Fresno Passes Groundbreaking ‘Tiny House' Rules.” KQED News , 21 Jan.

2016, ww2.kqed.org/news/2016/01/19/fresno-passes-groundbreaking-tiny-house-rules/.

Accessed 25 Nov. 2017.

“QuickFacts.” U.S. Census Bureau QuickFacts: Fresno County, California ,

www.census.gov/quickfacts/fact/table/fresnocountycalifornia/PST045216. Accessed 24

Nov. 2017.

“Tiny House Demographics.” American Tiny House Association ,

americantinyhouseassociation.org/tinydemographics.html. Accessed 25 Nov. 2017.

Vickers, Collin. “How Much Does it Cost to Live in a Tiny House? - Tiny House Listings.” Tiny

Houses For Sale, Rent and Builders: Tiny House Listings , 12 July 2016,

tinyhouselistings.com/how-much-does-it-cost-to-live-in-a-tiny-house/. Accessed 24 Nov.

2017.

“What Is The Tiny House Movement?” The Tiny Life , 19 Oct. 2015,

thetinylife.com/what-is-the-tiny-house-movement/. Accessed 24 Nov. 2017.

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“Wood Industry 4.0 Has Dominated Technology Trends in 2015.” Woodworking Network , 29

Dec. 2015,

www.woodworkingnetwork.com/news/almanac-market-data/wood-industry-40-dominate

s-technology-trends-2015. Accessed 24 Nov. 2017.

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