Two years after moving to Okanagan Falls, B.C., from Calgary, the aspirations of brothers Kurt and Kris Goodjohn are beginning to be realized.
The pair co-founded Karoleena Inc., a manufacturer of modular prefabricated homes and cottages, in 2006. Kurt Goodjohn likens the components that make up the company's modernist, energy-efficient houses to big Lego blocks. "We design all of our homes using our 'Lego' blocks, and then they're pieced together onsite," he says.
The brothers told their story in a Small Business Challenge article last March. At the time, they were trying to determine how best to expand the company. "Do we want to grow really fast, or do we want to have it be somewhat of a lifestyle[-friendly] type of business?" Kurt Goodjohn wondered at the time.
In the past 12 months, the company has doubled its full-time staff and contractors to 48, and while the brothers were hoping to realize $8-million in revenue this year, Mr. Goodjohn estimates it will be closer to $10-million, in large part because of their new, 35,000-square-foot construction facility in British Columbia.
The homes take roughly six months to build once the design is finalized. They are 80 to 90 per cent finished when they leave the plant and can cost anywhere from $200,000 to the mid-$600,000s.
Mr. Goodjohn has identified between 20 and 30 North American markets that could be served out of replicated facilities like the one in Okanagan Falls, with the first expansion market likely to be in the United States.
"We've sold our first three homes into the U.S., so the logical route would be to go south rather than going east," he says. The Pacific Northwest and Northern California are likely destinations.
- To see pictures of the brothers’ homes, click here.
The plan to expand to the States one market at a time was recommended by Ray Castelli, the chief executive officer of Weatherhaven, a shelter systems manufacturer, who was one of the experts in the original Small Business Challenge story.
Mr. Goodjohn said that advice, as well as other recommendations in the story, went a long way to helping the brothers determine whether they were on solid footing.
"I think probably the person from Weatherhaven was the most experienced in what we are trying to do," he said. "Basically it's validated what we're doing."
Mr. Goodjohn says the Okanagan Falls plant could eventually produce 20 to 25 homes a year, enough to bring in $20-million to $25-million annually.
But the bottom-line goal for the pair has always been to produce a quality product. That strategy has guided them through a number of crossroads, particularly when they were being advised to go cheaper and focus on high volume to succeed in the prefab home industry.
"We're going to walk before we run," Mr. Goodjohn says, "so we just keep focusing on our plan and executing on it."