Today I met with Alan, the Hansen and Horn VP of Sales, regarding the delays on our house. I had expressed serious concerns in an email sent to H&H last week about our house not being done by the end of the year, which would have financial consequences for us because of the window we had locked in for our financing. Alan and I had an enlightening conversation.

As a quick background: as of today, we’re now at three weeks with no work done on site. We’re currently waiting for framing to begin. Prior to this, we had spent nearly four weeks waiting for the foundation crew to start on the basement. We are, naturally, a little frustrated, and extremely curious about what was causing the holdups. When we inquired, they had only indicated that they were waiting for the appropriate vendors to be available; other customers, however, had started wondering on this blog and elsewhere if the company was still financially solid. I personally thought it was a cashflow problem due to them selling so many houses at the same time this summer (which they did) and now having to build them all simultaneously. Our Realtor even launched his own little investigation to make sure the company was on solid ground.

The point is, there was a lot of speculation and not a lot of solid info. So I was very much looking forward to my meeting with Alan. Let me point out that prior to entering the construction phase, there had been no reason to suspect there were any issues with this builder. They were always spoken highly of, and all the H&H employees we had come in contact with were some of the most professional, courteous, and honest people we’ve dealt with in any business.

In short, my meeting with Alan went well. He went out of his way to explain the situation to me and set my mind at ease. To address our immediate concerns, he assured me that Hansen and Horn would cover any costs associated with running past our financing window of December 31 (this is in addition to the promise they already made to cover the $8000 first-time homebuyer’s tax credit for not hitting the original November 30 target date).

To address the issue of the delays themselves, Alan stepped me through the situations they’re facing with their vendors. On the surface, you would think (as I did) that in this economy there should be dozens of construction companies out there ready to work at any instant. In reality, many have folded, and those that are left are often so cash-strapped that they’re insisting on payment before any work is done — so there goes a significant amount of the builder’s leverage for schedules. Then there’s the banks who finance the construction, who are being more tight-fisted and slow to disperse money than ever. Those are the core problems — lack of available vendors and bank financing — and Hansen and Horn is stuck in the middle of contractors who can’t buy the nails to do the job unless they get paid up front, and banks who don’t want to give out any more money until they see something more built. Alan spent much more time explaining the whole process and its problems to me in detail, which I will not attempt to recount here, but which I greatly appreciated.

The upside is, they’re working on a plan to allow them to continue to operate at the speed they’re used to within this changed construction environment. I will not get into any specifics in case anything Alan told me was sensitive information (not that I have a whole lot of specifics), but suffice to say that my mind has been set at ease and I — also working in a business whose fortunes are closely tied with other businesses’ cashflow — understand the issues Hansen and Horn is facing are not through poor practices on their part.

That’s not to say I’m happy about it at all, but having gotten a glimpse of what they’ve been doing behind the scenes I’m satisfied that they’re actually not messing around with us and have been straightforward about what’s going on. The situation is not ideal, but we’re OK with what they’re doing to make it right. The financial guarantees and the facetime with Alan certainly helped.

So, a little more hurry up and wait for now. Although Alan did indicate that they’re pressing hard to get the lumber for our framing delivered at the end of this week, so we’ll be watching for that.

Let this be a lesson to all service-based businesses: just communicate! Most people are rational and understanding (most), and even I — not known for my huge amounts of patience — can understand and sympathize with what you’re facing if you just give it to me straight, rather than let speculation run rampant and amplify people’s fears by not communicating thoroughly. This is a problem we see at my company with a lot of businesses who are used to just giving the “company line” when there’s an issue. In the Internet economy, conversations about you are happening out there whether you want them to or not (see: this blog), and what people are looking for is open and honest communication rather than a PR line. Consumers appreciate that more than many businesses yet realize. /off soapbox