It’s the time of year that summer comes to a close…the end of a season associated with happy, warm and carefree days. However, this description of summer is not necessarily reflective in the funeral industry. Just like the ocean, the death rate has an ebb and flow; historically the death rate is higher in the 1st and 2nd quarter of any given year and the 3rd quarter (summer) is significantly slower. This historical trend offers the opportunity for timely discussion.
As a funeral home owner/manger, how do you prepare for the ebbs and flows of the death rate for expected “slow times?” Does your firm adjust prices based on recent revenues? What type of marketing campaign do you launch (if the phone isn’t ringing, then go out singing is one of our firm’s methods)? Or are you the proponent of the ever popular “we have experienced this before” and do nothing? The problem of decreased death rate in today’s atmosphere is coupled with other issues; competition (locally and online), shopping consumers, increase of cremation, decrease of traditional burials, and of course when a call is lost, so is the revenue along with that family most likely not returning either.
Lest we forget: it’s price increase time! Yes, if not yet, your happy supplier will visit soon telling you how much you are loved and appreciated…and that love will cost you more this upcoming year! Now, don’t forget that suppliers have to make profit and if you review the wall street owned ones, they do handsomely. Nothing wrong with profit, frankly I’m in favor. Back to my point, this time of year. The funeral homes that I am owner/partner, we operate our fiscal year January-December. However, the major suppliers find it necessary to impose their fiscal calendar upon us to suit their financial needs…this time of year.
What does this mean to you and your firm? Well, first it’s time for you to make adjustments to your GPL and product price lists or absorb the product price increases starting October 1. Remember the “slow” summer season just ending? Now you have to account for those losses and adjust for upcoming increased product costs. Frankly, if your firm has been adjusting prices along the way, this is not a big deal. However, the majority of funeral homes in the US only make price changes this time of year, when dictated by suppliers, if any adjustments are made at all. I know it’s hard to believe, but I see GPL’s and price lists that are actually dated “2010.” Second, are the prices you are paying for products (and getting ready to pay more) a value to your firm and families? At some point, there is a price for “loyalty,” just ask consumers. I’ll address this question in another post soon.
So for discussion sake, how does your funeral home address “slow periods?” Anyone out there heard the latest price increase numbers? What are your methods to formulate price adjustments? How often does your firm adjust prices and what time of the year if only annually? Happy Labor Day (I’m working, but doing so with a cigar as part of the celebration). Cheers y’all! #thefuneralcommander