Linking contractors and suppliers

Home Channel News, March 20, 2000 by Monica Toriello

Michael Holigan's i2Build allows contractors to order their supplies from a Palm Pilot

He's a builder, a television personality, a franchisor, a supplier and an e-tailer. But Michael Holigan has put yet another iron in the fire, and it just might give him another role -- that of business-to-business Internet mogul. The unassuming, easygoing 35-year-old co-founder and president of Dallas-based Michael Holigan Co. has a new project that he's betting will revolutionize the building industry in the very near future.

Michael Holigan Co. was established in 1982 as Holigan Homes, a family business that Holigan began with his father, Harold Holigan. Through a combination of what Holigan calls "blessings from God," creativity and a willingness to try new things, the company has grown into a builder that constructs more than 2,700 homes each year in 10 states. What started as a 30-minute Holigan Homes infomercial has now evolved into two nationally syndicated TV shows -- "Your New House" and "About the House" -- seen by more than three million people each week. Every month, about half a million visitors click on Michael Holigan's Web sire, www.michaelholigan.com which is updated daily with content from the TV episodes and which in the first week of February alone sold $260,000 worth of hardware and building materials.

But all of that isn't what's keeping Holigan busy these days. His latest venture, called i2Build, has become his passion. A Web-based ordering system that can be customized to each builder that uses it, i2Build gives contractors the ability to electronically order materials from their preferred suppliers. A builder armed with a Palm Pilot can walk through a job site and order what he needs on the spot.

"This is like Internet for dummies," Holigan said. "It's so easy to use. Builders don't have to rake notes on their yellow pad while they're walking through a house, and then spend time calling or faxing their suppliers when they get back to the office."

When a builder signs up for i2Build, his takeoffs are uploaded on the system and then populated with materials and pricing from his preferred suppliers. If those suppliers aren't already in the network, Holigan contacts them to tell them about i2Build.

"All [the suppliers] need to do is show us their current inventory system, and our technical team creates an interface," Holigan explained. "We don't need to use their tech people, and they don't need to write any new software." Participating suppliers -- whether they are pro dealers, distributors or manufacturers -- pay Holigan 1 percent of sales generated through i2Build. That way, the service can be offered free of charge to contractors.

A dozen builders in Texas, Missouri and Tennessee already use i2Build. Ron Bickel, who constructs about 150 homes a year in the southern United States, purchased Palm Pilots for each of his superintendents after signing up for i2Build.

"It's an amazing tool not just for ordering but also for scheduling and record keeping," Bickel said. "With i2Build, you can never forget to order something, because the system reminds you. It tells you when to place your order and when your materials are coming. And if your work gets delayed because of bad weather, you can tell the system that, and it adjusts everything automatically."

If all goes according to plan, i2Build will give Michael Holigan Co. tremendous buying power. All of the builders using the system will, in essence, be ordering through Holigan's organization, which gives his company the ability to order in large volumes from a growing number of suppliers and then to pass the savings on to builders.

Holigan said that at one of the company's recent "hospitality meetings" for builders, which it holds in tents at NASCAR races, all but two out of 300 attendees said they would be interested in using i2Build. Holigan plans to market the system to 4,000 builders this year during racing events.

Building a national brand

During these hospitality meetings, the company pitches i2Build as well as another Michael Holigan program, Michael Holigan Franchise Systems. The franchise program allows builders across the country to sport the Michael Holigan brand, to the tune of $50,000 upfront plus 4 percent of gross sales for the next 10 years. Participating builders also would have to purchase all their materials through Michael Holigan.

These fees may seem steep, but Holigan argues that the returns on investment are worth it. The Michael Holigan brand, after all, is on TV seven days a week and can be seen by 84 percent of the country's viewers. It is plastered all over a NASCAR race car, and NASCAR fans show a 72 percent loyalty to team sponsors, higher than in any other professional sport. The brand appears in a monthly advertorial in USA Today. Holigan said that as a result of its marketing efforts, the company is constantly flooded with phone calls and e-mails from consumers seeking recommendations for home builders and contractors.

"You get the brand, you get qualified leads and you get purchasing power," Holigan said. Currently, he has signed 25 franchisees in 10 states. The company's goal is to have 200 by the end of the year. But, not every builder can become a Michael Holigan franchisee. Those who aren't dissuaded by the fees still must undergo scrutiny from the company to make sure that their standards meet the company's in every way. Interviews with the builder's vendors, customers and bankers, as well as inspection of completed homes and homes under construction, arc part of the intricate process, which Holigan said takes about 60 to 75 days per builder.