By shifting resources, Peter Foley was able to keep this company above water during a major industry slowdown.

When Peter Foley founded Nations Builders Insurance Services (NBIS) in 2002, his primary focus was to service the residential construction sector. From that point through July 2006, it was a relatively good market. “We had more business than we knew what to do with, which was fantastic,” Foley said of the Atlanta-based company.

In late 2005, the company kept a close eye on things after hearing initial discussions regarding a potential softening of the residential housing market. Foley and his team didn’t experience a slowdown for the first six months of 2006, but the following month, business came to an abrupt halt. Foley described it as a rubber band snapping.

Proactive push
Foley and his team immediately took action, beginning with a proactive marketing push on its remodeling programs. NBIS also made some more aggressive moves toward its distributions. “We went counter to traditional thinking,” Foley said.

Peter Foley

During that time, NBIS also made a geographic push. Previously heavily weighted in the Western US, it started reaching out to eastern and central states.

The whole spectrum
Today, Foley still sees the new-home construction market in a depression. “It’s significant,” he said, noting that many builders’ businesses are down 25% to 60%. “They are trying to hold their own at the moment and not expand until inventories get worked down.”

In April of last year, NBIS made an acquisition in the commercial building/heavy construction sector, an area experiencing strong growth. “If we’d had a crystal ball and could have seen how bad the residential side was going to be, we probably would have shifted our resources a little faster,” Foley said.

But compared to its competitors, NBIS is an industry leader because of the diversification and heavy construction sector, said the CEO. “We’re one of the few companies that write liability and related coverage for that sector,” said the CEO. “We deal with general contractors and subcontractors operating in the various trades. A lot of our competitors say they want to go after one or the other, but we go after the whole spectrum.”

NBIS offers a variety of products to benefit a sole proprietor and/or a large general contractor. Therefore, if a certain segment gets impacted and starts to do poorly, NBIS can balance out its business by using more resources in another segment. NBIS is also geographically diverse as it’s one of the few companies that offer the capability of doing this kind of business in 50 states, according to Foley.

“In terms of our customers and their revenues across the board, we’re down 25% to 30%. The good thing is that we’re up on the commercial construction side in the as a result of aggressive marketing and coming out with new products,” Foley said.

Game plan
Since the residential construction slowdown, Foley set up aggressive marketing efforts within the organization. “It’s not your traditional marketing of sending flyers or ads,” he said. A sales team, with expertise on the company’s new products, answers any questions from NBIS’s insured builders.

“Customer service is critical,” Foley said. “The sales force in our marketing division takes phone calls—we have humans answering the phones, not ‘punch seven to reach customer service.’ They track inquiries, track the metrics on our business, and circle back and work with our customers.”

Along with that NBIS provides plenty of material information for customers, including designing marketing materials for their booklets or presentations.

“We’ll also come back to a builder and say, ‘Okay, we wrote your insurance for one year, and you didn’t renew. Give us some feedback and tell us why.’ We find out why, and if it’s an area we can correct, we’ll correct it. It’s aggressive, proactive, and customer friendly,” Foley said.

In addition, if a customer within the sales or marketing group comes up with an idea for a new production, or a revision or adjustment to an existing product, the marketing group will analyze it and gather the market knowledge necessary to determine if they are viable. If all goes well, the group will make those changes.

“Data is critical, and we understand where we’re getting the business. We have a strategy and game plan. We’ll see some very strong growth from our commercial side, and even if the housing market doesn’t return, I know we’re going to have a good year in 2008,” Foley concluded.