RealTorch › The 15 Functions › Product Development
Function 04 of 15Product Development
Product Development decides what you sell. Every other function is downstream of that choice.
This function owns home design, the specifications that go into construction, interior selections, and the production of the plan sets everyone else works from. Its output is the offering: how wide the lineup is (how many distinct buyers you can serve) and how deep it goes (how much a buyer can change within a plan).
The knowledge base separates the base product — the house as specified — from the augmented product, everything around it: warranty, process, the builder's reputation, the way selections are handled. Buyers compare augmented products even when they think they're comparing square footage. Functional design is judged on livability, efficiency, flexibility, privacy, traffic patterns, zoning, storage and aesthetics, and a plan that wins on paper can still fail on a lot it was never drawn for.
Width and depth
Width serves more buyers; depth serves each one deeper. Both cost money and neither is free to add.
Base vs augmented
The house is half the product. Warranty, process and reputation are the other half.
Plans are drawn for lots
Elevation, orientation and frontage decide whether a good plan is a good house here.
Standardise, then vary
Every one-off is paid for three times: in estimating, in purchasing and in the field.
Atlas in action
Nine plans, a shifting market, and a lineup nobody has re-examined in three years.
Three plans are fighting over one buyer, and there's nothing between 2,400 and 3,300 SF.
The Aspen, Bellamy and Cormac all land within 140 square feet and $18,000 of each other, and together they took 61% of sales — that isn't three plans, it's one plan with three elevations, carrying three sets of estimating, purchasing and plan-set cost. Meanwhile 34% of closed sales in your submarket happened between 2,400 and 3,300 SF, where you offer nothing. The Dunmore has sold twice in 24 months and is the only plan with a side-load garage, which is why it's still drawn.
| Plan | SF | Base price | 24-mo sales | Read |
|---|---|---|---|---|
| Aspen | 2,180 | $389,900 | 24 | OVERLAP |
| Bellamy | 2,240 | $398,500 | 31 | OVERLAP |
| Cormac | 2,320 | $407,900 | 19 | OVERLAP |
| — gap — | 2,400–3,300 | — | 0 | 34% OF MARKET |
| Dunmore | 3,410 | $524,000 | 2 | RETIRE? |
| Everly | 3,680 | $561,500 | 14 | HOLDS |
Composite example. The recommendation Atlas makes here is to collapse three plans into one with three elevations and draw into the gap — not to add a tenth plan.
A lineup drifts one plan at a time
Nobody decides to have three plans serving one buyer. It happens over four years of reasonable individual choices. Atlas reads the lineup and the sales together and shows you the shape.
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