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If your funeral home has accounts receivable, your payment policy is worthless.  The funeral director in charge of arrangements perpetuates the problem and owners are guilty of holding anyone accountable with a lack of leadership.  As a funeral business consultant, I can quickly diagnose the situation by studying the A/R and role playing as a family member in an arrangement session.  Fortunately, I have the solution to fix the cash flow problem; however the decision lies squarely on the shoulders of funeral home ownership.

Why is the decision so difficult for funeral home owners to make a commitment to improve their cash flow and significantly reduce their accounts receivable?  By doing so it’s an admission that their arrangers care less and are unaccountable.  Owners would rather scramble to make ends meet (because cash flow is suffering) than actually take charge of their business by changing behavior of funeral directors.  Additionally, there is a cost for professionals to conduct adequate training.   Professional training solves cash flow and other funeral home operations problems, yet owners rarely seek training as a source.  Rather they create knee-jerk processes with no accountability or device to measure success or failure.  Ultimately, the inmates are running the asylum.

A working payment policy is predicated on use of the GPL and offering payment options near the beginning of the arrangement session.  “Talking about the money” should not be put off until the goods and services statement is provided at the end of the arrangements.  Ever wonder why families must take a bathroom or smoke break when the goods and services statement comes out?  It’s because the funeral director failed to do his or her job by addressing the second most important issue for a family (right behind the death of a loved one); “How are we going to pay for this?”

If a funeral home has accounts receivable, the payment policy isn’t working and neither are the funeral directors.  Don’t like it?  Do something about it and make a damn decision, or just continue the failure to collect the funds needed to make payroll.  Sooner or later, you’ll need to email jeff@f4sight.com.

Back and refreshed from cigars, libations, great food and time with my family at the Command Post (East), Cheers Y’all! #thefuneralcommander

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The largest expense for funeral home overhead is payroll and employee expenses.  Unfortunately, many funeral home owners poorly manage this facet of their business and in doing so not only decrease profit but place themselves in peril for labor lawsuits. Some firms over-staff which puts pressure on margins and others under-staff which places the owner in violation of Department of Labor violations. Speaking of the DOL, we are only weeks away from significant rule changes that have effect on the majority of funeral homes in the United States.  Below are three highlight of the changes that take effect December 1st:

  • The minimum salary level an employee must earn to qualify for overtime will change from $23,600 to $47,476.
  • Highly compensated employees have a new minimum earning level requirement of $134,000
  • New mandatory mechanisms to increase levels of compensation will trigger every three years.

What does this mean?  Frankly, in many cases it’s going to cost funeral home owners more money to operate their business. This means that the three basic tenets of running a business come into play; raise prices, conduct more calls, or cut costs.  Some owners will ignore the regulations (just like the 25% violating the FTC rules) and do nothing. However, if owners choose to operate hoping that a director will not keep his or her notes regarding overtime worked without just compensation, those owners are really placing themselves in a bad position.

I have found in my practice as a funeral and cemetery consultant that many owners think they have covered their bases by having an employee handbook (which has not been updated in years), assigning “exempt” status to employees that don’t qualify, and refusing to get professional advice or council. As I have said many times, I find it interesting that funeral professionals chide families for “buying cheap” or using other services/products than what is offered at their particular funeral home. You know the, “You get what you pay for crowd.” But when it comes to hiring professional experts in subject matter other than funeral, they themselves “cheap out” and regularly fail at the “DIY” method.

Folks, these new Department of Labor changes in overtime status are serious and could have grave (yeah, deadly) consequences for funeral homes if employees are not compensated properly. If you think that having a state inspection is a big deal, try having the federal government on your ass because of an employee complaint. One way or another, funeral home owners are going to have to write checks; when and how much will only be determined based on following the regulations.

Watch Episode #54 of Funeral Nation TV with human resources expert Stephanie Ramsey providing more color on the subject or email me jeff@f4sight.com to find out how to “CYA.”

From the Command Post (West), Cheers Y’all! #thefuneralcommander

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It’s Veterans’ Day and I am going to utilize my constitutional right to voice my opinions.  Although every American has such a privilege, I’ve certainly earned mine.  Yep, I’ve turned into one of those “old crusty guys” and my uniform hangs in a closet. I’m one that places my hand over my heart standing at attention (if not saluting) when our flag passes in a parade or during the National Anthem. Today you may see many like me wearing hats adorned with ribbons and badges that to most, have no meaning.

Every Veterans’ Day I get a bit reflective and at the same time, I think about the blessing of belonging to the best fraternity in the world; people that would give their life for others. See, when we take the oath of office, we swear that we will protect and defend…everyone!  I still keep that oath and I swear, I would still fight today. In fact while writing this, I get a serious case of whoop-ass.

I have been in harm’s way and witnessed the only form of the perfect society.  Muslims, Jews, Baptists, Catholics, Blacks, Whites, Asians, Hispanics, Men, Women, and yes I’m sure a few Homosexuals prayed together because we knew we could die together. We were willing to die for something bigger than ourselves: a common purpose.

Our nation just completed an election, and many think it was seriously contentious.  Yeah, it was a bit rough, but there were times in our history we were literally battling on our own soil, even against each other. The Facebook and Twitter cowboy bravado was hilarious because it was like watching a pillow fight at a junior high girls’ sleepover. I am actually enjoying the aftermath of watching the crying and sore losers. College students are allowed to miss class to grieve the election results and protesters take to the streets because the outcome didn’t go their way, bless their little fragile cupcake hearts.

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Yes it turns my stomach, but I know it was us Veterans that gave them the freedom to display their selfish and myopic behavior. I can assure you that the men and women serving all over the world got up Wednesday morning, put their uniforms on, and did their assigned duties. Why? Because they perform their duties for something greater than themselves: our democracy. In fact, they provide the freedom for the “I didn’t get a trophy” college weaklings, the naerdowell protesters, and the knee-bending attention-seekers.

Today is our day.  The 11th day of the 11th month that honors the men and women that offered to give their life for our way of life.  I have generations of family (including my son) that served and hundreds of people I served alongside for the same principles.  There are few like us and my salute to all.

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For everyone else, just for today, if you don’t like the way things turned out, keep your pie-hole shut unless you thank those that gave an oath for your privilege to vote. From the Command Post (West) and ready to kick ass to someone that disagrees with me today, Cheers Y’all. #thefuneralcommander

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Freshly returning to the Command Post (East) from #NFDA2016 in Philadelphia, I’m providing an After Action Review of what I saw, didn’t see, and my experience perspective this year.  From the logistical front, the NFDA team could not have selected a better venue that provided a huge Expo floor with easy access to educational seminars and walking distance to many hotels. Also, the NFDA app was a stroke of genius! I give the entire NFDA staff a salute for a well-executed and attended event.

From my perspective, the biggest influential segment of this year’s event was Social Media and Technology.  Facebook was on fire with posts, selfies, and live updates from attendees as well as vendors.  Homesteaders Life and  Disrupt Media sponsored a Social Media Lounge providing attendees a venue for all things social.  Live feeds by Funeral Nation TV were given and frankly, the funeral world is turning a corner and starting to “get it.”  Technology abounded, with website developers adding new services and add-ons.  Funeral home software continues to permeate the norms of doing business and my choice of the best was Passare with their collaboration platform connecting families to the arrangement process with their easy-to-use program.  There also were some “newcomers,” attempting to breach the market with very narrowly and poorly thought-out “new funeral apps;” however it’s obvious they did not do their homework, as most redundant offerings have failed to gain any traction in the past.

From a product standpoint, there was noticeably larger presence of foreign casket providers than ever before.  The Sich Casket booth was full continuously and I have to give them the “win” for marketing with their surprise “God Bless America” flash mob and free coffee stands.  Urns were everywhere and I’ll admit, I saw some unique designs that are “upping the game.”  What struck me was the flood of “same old stuff” in many booths.  (Are consumers still buying these relics or are the vendors trying to dump inventory?)  Outer burial containers didn’t offer any new “wows.”  I have to say the most personable was the Darby Family at Trigard Vaults.  You are always guaranteed hugs and hairdos with them!  At the Pierce Chemical booth I watched (and took video of) an artist bringing life to the lifeless.  The Pre-Need Builders after care program was also a breath of fresh air in the service market.

Speaking of the art of restoration/embalming, I heard some rumblings about the lack of embalming subject matter presented in seminars.  However, this is indicative of the focus in perhaps the most important segment that needs to be addressed to funeral home owners/directors:  financial health.  Consumers are dictating the direction of our profession.  Adapting to better business practices, understanding consumer needs, how to better communicate to and reach families, along with becoming profitable for the swelling tide of cremation, are topics that were at the forefront of the majority of seminars.

The Foresight Companies had a “free money grab” at their booth which again makes sense;  if a funeral home is not making great profit at least you can have a chance to grab free cash.  From the financial services segment I noticed the lack of new companies present.  The representation of pre-need companies seems to have leveled as well as that of the insurance assignment firms.  The largest footprint of assignment companies was from C&J Financial and  American Funeral Financial (shout out to Jackie Williams and Chuck Gallagher for their new “live stardom”).

I did not see companies like Save My Ink, Trey Ganem Designs, Qeepr, DNA Memorial, The Help Card, and many others. In the competitive funeral industry product/service marketplace and although they may still be operating, the lack of presence along with top-mind advertising is pretty much a kiss of death (no pun intended)…you have to BE there!

I posted  It’s about the relationships, not the productivity this week at the onset of the Convention.  Truly, relationships are the defining factor of funeral business.  Seeing longtime friends is a bonus for me personally at these events.  Talking with clients and receiving accolades in person that our work makes a difference in their lives is irreplaceable.  Conversations with prospective clients and listening to their situations of working in such a tough environment bring me excitement, because we have solutions.  The bottom line is that we are all in the funeral business to serve families at one the most difficult events in life:  death.  How we as an industry intertwine our businesses, relationships, strengthen financial heath, and bring the most positive light to our profession is the key to long term victory.

The synopsis of #NFDA2016 is of a huge success from the many observations shared above.  Watch Ryan and I next week on Funeral Nation TV for a full follow up of this year’s event.  Today is the “new funeral year,” so it’s time to get back to work.  From the Command Post (East) with my comrade Rat Terrier at my side, Cheers Y’all! #thefuneralcommander

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I was recently shocked when a couple of friends that work for a big funeral industry supplier were told by their management “relationships don’t matter, it’s all about productivity.”  This is simply not true because a relationship is the only glue that binds the brand to the customer. Say what you may, the funeral profession is about relationships. I have yet to meet an owner of a funeral home that buys from or does business with someone they really dislike.  In fact, in many cases it costs more to work with someone you like because of the value brought to the relationship.

As funeral home owners and directors, pause and consider that the families you serve are exactly the same. The majority choose a funeral home because they have a relationship with the owner or staff. Just below in rank of why a consumer chooses a firm is because the firm served a family member or friend in the past (notice price is not even at the top two).

Large gatherings like NFDA and ICCFA offer us a reason to arrive from all corners of the earth to commune with each other for a common purpose.  These few days of the “Funeral Super Bowl” in Philadelphia provide attendees many opportunities to become better educated and access to what’s new. However, the most important aspect of the gathering is strengthening old relationships and developing new ones.

As you know, I’m all about technology, Social Media, and new sources of reaching people. But the most effective form of communication is looking into someone’s eyes, conversing face to face, and listening.  A handshake, warm introduction, and genuine conversation are more captivating that “20% discount.”  Of course my preferred method is Mano y Mano, with libations and a cigar perhaps even during a round of golf. I have a very keen bullshit meter and I easily separate authenticity from superficial and the Mano y Mano method tends to prove true.

Interesting that even lower costs or fees has no relevance in a positive relationship (unless you want a cheap date). Relationships are a two way street with mutual trust and respect at the forefront. If you are here in Philly, let’s connect at booth 4318 or send me an email jeff@f4sight.com so we can schedule time together.  I’ll shake your hand, look you in the eye, and listen.  If we can get to it, I know a great spot for a libation and cigar which is always in order.

From the FOB in Philadelphia, Cheers Y’all! #thefunealcommander

 

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I have funeral home owner clients that are astounded when the epiphany of the number of calls are irrelevant to their profit.  In a few weeks, the Super Bowl of funeral service is in Philadelphia where the pontificating will be at extreme heights.  One of the biggest of all is the “tale of calls” (not to be confused with the tail of a whale).

Allow me to explain.  A firm touts they are having a great year tracking to conduct 250 death calls over the 225 last year.  If the casketed calls this year are only 40% (100 of 250) of the total versus 50% (112 of 225) last year…is the firm really doing better?  If the firm “picked up” 38 new calls this year which are non-casketed, did those calls even budge an increase to their profit margin, most likely not.

In a recent Funeral Boot Camp where attendees learn how to properly charge for goods and services as well as understand measurement of profitability, I saw something remarkable…or so it would seem.  A 60 call firm had more cash in the bank and net profit than a 200 call firm.  How is that possible?  Revenue per call, proper pricing, and frankly they are a great client of ours (meaning this firm is making good decisions).  Since the revelation or the before mentioned “epiphany,” the 200 call firm has seen the light and now on their own path to profitability with our guidance.

So the next time you hear Foghorn Leghorn “crowing” about his call volume, ask ‘ole blabby what his profit margin is…and listen for the crickets.  The more you know, the smarter you are.  Be smart and contact me jeff@f4sight.com for your own epiphany.

From the Command Post (West), Cheers y’all! #thefuneralcommander

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My last post Funeral Industry David vs. Goliath was referring to innovation in the funeral industry. From all intents and purposes, Goliaths dictate and Davids innovate.  There is no greater example of this analogy in the funeral business than casket manufacturers.  Just recently one of the casket Goliaths was recognized for their “innovation.”  What is innovation?

Webster’s Dictionary: Innovation; a new idea, device, or method.

Have we become so complacent in our industry that throwing “old wood” on a casket is considered innovation?  The definition should be expanded to include making products for less cost (Chinese hardware and cloth for interiors) and moving South of the Border for manufacturing. YES!  Now that’s innovative; however with these cost saving measures why are you paying more for Goliath Company’s caskets?

There was a time when the casket peddlers led the industry with messages that their product was “the center of the world” and families would pay premium prices.  At that point in history (before Al Gore invented the Interweb) funeral home owners drank the Kool Aide by selling families Bronze, Copper, Stainless Steel, and Mahogany caskets even some adorned with gadgets.  Good idea, right?  I mean, the profits from these transactions had to be incredible. How’s that “innovation” working out for ‘ya today?  Funeral homes filled their casket rooms (later to become known as Hallmark Stores) with good, better, best, and ignoring the service side of their business.  What did the Goliath’s do?  After the contracts were signed and the rooms were filled, prices began swelling faster than a Krispy Creme doughnut in hot oil. Fast forward to 2016; when was the last time your firm sold a Bronze, Copper, or Mahogany casket at need?  In fact, exactly what material (Gauge or Wood type) is the average casket your firm sells now? Now Goliath’s are spewing “don’t raise our prices, raise your service prices” as they hand you the new X% more casket price-list for 2017.

Interesting that the casket Goliath’s even attempt to be “business consultants,” however 90% of the road warriors haven’t a clue how to interpret a funeral home P&L, much less understand the process of operations.  Perhaps I should create a “funeral home business and operations quiz” so that the next time Skippy the Casket Clown knocks at your door, you may find out just how much he knows about your business.  The results of the quiz will be devastating to Skippy.  But no fear!  Skippy will reach into his bag to reveal that he can improve your website (with a template), increase your cremation revenue (with his company’s Chinese urns and “proven presentation strategies”) along with various and sundry useless items for sale.  Innovation would be to improve the funeral home operating processes and providing solutions to elevate the positive financial posture for profitability.  Wait!  Maybe a trip, game tickets, or a nice meal will make everything better.

Let’s get down to the truth, shall we?   Caskets are made of wood or metal (unless you get the ones made in Mexico, they are wood composite).  The definition (according to my indoctrination in the cornfield) of a casket is “a container for precious materials.”  The deceased (precious loved one) is placed in a casket, their loss mourned, their life celebrated, and they are buried never to be seen again.  If your funeral home’s financial life depends on one of Goliath’s spawn, your business will be in a container for precious materials as well.

What would be innovation for caskets?  How about finding a way to manufacture a quality product for less?  The casket manufacturing Davids have already done so.  A simple price analysis and side by side comparison of local distributor, small manufacturer, or offshore caskets will reveal Goliath is out of touch and David has an arsenal of rocks in his sling.  Oh yeah, one more “innovation” that Goliath created:  “off brand” caskets that are sold through the local distributors.  Yep, the same casket you may be paying up to 50% more with a 1-cent sticker comes right off the manufacturing line as the “off brand” does.

Thanks to the itnerweb and frankly, enlightenment of funeral directors, the casket Goliaths are taking more rocks to the head from the casket Davids.  The Goliath notion of treating funeral directors like mushrooms (“keep ‘em in the dark and feed ‘em crap”)   days are coming to a close.

I am more than happy to further this line of factual thought with anyone that chooses to reach out to me.  I challenge any Goliath representative to a public debate on Funeral Nation TV to refute these points of innovation.  What the heck, its debate season so the floor is open!

From the Command Post (West), without libation or cigar for clear thinking, Cheer’s Y’all! #thefuneralcommander

 

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