Reset Reminder–Ryness Rolls a One-One
Outsourcing. Remember in-house resources were not enough to keep up with demand?
As the volume home building model re-sizes to battle 2001 or 2002 prices, questionable demand, and no access to operating funds from bank lenders, third party sales support is the last thing most operators need these days.
So, companies such as Ryness–which helped on the overheads, and flanked the internal sales resources with sales reps who looked and acted like one of the gang–are on the bubble of the real estate correction of the latter part of this decade.
Big Builder executive editor Sarah Yaussi has reported on the bankruptcy filing, with some intriguing extra detail into how tenuous Ryness’s capital structure had become during its go-go swansong years.
Click image for more info on Gary Ryness
We’re not surprised they’re going through this because it has been a difficult year,” said Steve Kaller, CEO of Ultimate New Home Sales and Marketing, a Ryness competitor in California. “You have to get people through the fear of buying, and then there are financing issues. Getting financing for anything that’s a jumbo is tough.”
However, other sources familiar with the company point to some untimely acquisitions and business partnerships. In 2004, the company expanded into Arizona, Nevada, and the Pacific Northwest. A year later, the company launched Sullivan Group Real Estate Advisors, a national market research and advisory firm. And then in 2006 came the acquisition of The Marketing Directors.
But of late, many of the partnerships have crumbled. Sources at the Sullivan Group have stated that the two firms parted ways two years ago. And other local sources stated that the parent corporation has turned some regional operations, particularly in California, back over to the original owners. Not to mention growing strains with key financial sources, leading to legal issues in 2008.
However, some of Ryness’ builder clients appear to be unfrazzled by the news of the company’s bankruptcy. One company’s Northern California group that uses Ryness for its sales staffing, indicated that it has been business as usual since the filing. In fact, management indicated that because many of the issues stem from the company’s East Coast acquisition of The Marketing Directors, it expected little fallout in California. Management also added that that it is pleased with its relationship with the Ryness team and looks forward to continuing to do business with them.
Gary Ryness, company founder and president, could not be reached for comment at press time. The industry has widely regarded Ryness as a sales and marketing expert. His leadership in the industry includes, but is not limited to, serving as an advisory board member for the University of Southern California’s Lusk Center for Real Estate, founding trustee of the national Builder Marketing Society, recipient of the Northern California home builder association’s sales and marketing council’s Lifetime Legend Award, and a 2002 inductee into the California Building Industry Hall of Fame.
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