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economics post

The issue of families struggling to pay funeral expenses is ongoing and I believe poses an increasing threat to funeral home financial health.  Take a few moments and read an article posted in Forbes last month: 63% Of Americans Don’t Have Enough Savings To Cover A $500 Emergency.   Now let that sink in a bit…

Depending on the zip codes your funeral home serves, regularly working with families who struggle paying for your goods and services may not be an issue.  However, there is enough negative economic news to support my continued message that we as an industry need to start paying attention.  Take a look at the chart below (courtesy of the St. Louis Federal Reserve and found by my fellow funeral professional Raymond Aikens):

FED Economic Data

One of the solutions for dealing with this problem is to train funeral directors how to address families in an arrangement session regarding payment options.  Yes, I know that your firm accepts full payment before services rendered and you have a payment policy.  So why do you have accounts receivable? Because your funeral directors sign contracts prior to securing the funds to pay for services rendered, the family walks out the door, the service is over and you have an unpaid bill. It’s your fault, period.

At Need Credit offers training and solutions of how to secure payment before a funeral contract is signed and also programs that will put your funeral home in a $0.00 accounts receivable status.  If your firm has past due accounts, our Simple Funeral Payment Plan provides a program to not only collect much needed funds, but also keep your firm in compliance with federal lending regulations.

This year I will be offering CEU’s at conventions and meetings to address cash flow for at need services. Contact me for further details and let’s do something about the ongoing problem with a solution, not just talk about it.  From the Command Post, Cheers Y’all! #thefuneralcommander #FNhustle #FNchange

 

Payment Plan 2

This post is a continuation of the discussion I started in last week’s post Funeral Payment Plans for At Need regarding an epidemic of consumers that are struggling to pay for funeral expenses.  Determining if your firm needs a funeral payment plan to offer families you are serving requires a bit of research and math.  It’s a relatively simple exercise; however much like any program for improvement, the first step is to question if you have a problem.

Here is a quick way to determine if your firm should have a funeral payment plan:

  1. Look at the last 100 cases performed at your funeral home.
  2. On each goods and services statement, did you collect the exact amount for each item equal to the amount listed on your General Price List?
  3. No matter the reason is there a difference between collected/charged and listed price (was there a discount)?
  4. List the amount of difference per case and add the difference for all 100 cases.
  5. Do you have any accounts receivable (money owed from those services) over 30 days?
  6. Now add #4 and #5 together…what’s that number?

If there is any amount of money either discounted or owed to you, then you have a problem.  Your firm either gave something away (discounted) or you have not been paid for what your firm provided (goods & services receivables) which inhibits your cash flow (the lifeblood of a financially healthy funeral home).  I know that there are thousands of funeral directors out there that tout “we collect all our money up front before services rendered, period!”  Yeah, okay so why do you have accounts receivable and why did you discount from your GPL prices?

Now that you have determined and recognize that your firm has a problem, the second question is what are the steps/process for correction? This is a critical yet difficult part of the process; do you have the intestinal fortitude (noun: courage; resoluteness; endurance; guts) to make a change in your arrangement process and behavior?  Or in Funeral Commander terms can you grow a pair, take charge of your business and actually lead your people to the promise land of getting paid for the work you do?

The third question to ask yourself is how do I fix the problem?  Well, I have the answers with training and I’ll be rolling out a new suite of funeral payment plan solutions shortly with At Need Credit.  In the meantime, I challenge you to do the math above and send me an email jeff@theharbesongroup.com so we can initiate the conversation.

From the Command Post through a thick fog of smoke on the front lines in the war of funeral reality, Cheers Y’all!  #thefuneralcommander

 

 

 

fd tng 2

Funeral director training can eliminate the awkward and difficult position they are placed when a family is financially challenged to pay for funeral services/products provided.  Consumers continue to struggle in our economy as depicted in the chart below that was shown just this week on MSNBC that the average middle class income is around $53,000.  So if the middle class income is this low, how about the incomes in the below middle class segment?  That group of people die too and face even greater challenges…

consumer struggle

If your funeral home has not yet had to deal with such a situation, two things come to mind.  You are blessed to be in a zip code that is financially stable or it’s just a matter of time.  Training funeral directors at our funeral homes to address the lack of funds for payment of services rendered has virtually erased the issue.  If your funeral home has a payment policy yet has accounts receivable in the “book of promises,” then your payment policy is a failure and useless.  I have been in hundreds of funeral homes and I have seen “payment policies” in arrangement rooms in frames on the walls, in frames on tables and even on GPL’s with those firms having quite a bit of money owed to them.

Part of our consistent TouchPoints training provides our funeral directors with tools and scenarios to address money issues with families.  By doing so, funeral directors have the confidence and complete understanding of all the tools available to solve any financial situation.  For instance, when a family states “we don’t have much money,” the proper trained response is “how much is not much money?”  By engaging in this conversation, the funeral director has a dialogue with the family that bridges their particular financial situation with their expectations of services/products.  Once this conversation takes place, then the funeral director has the ability to match offerings with the family’s budget.  By not having such dialogue early in the arrangement session and training how to breach such a sensitive subject without making the family even worse about their situation, training is a must.

Just for a moment, think about this: When a family loses a loved one, at the top of their mind is their loss.  If the loss is coupled with financial issues regarding payment for services/products rendered, shouldn’t that burden be addressed pretty quickly?  How many times in your funeral director career have you made complete arrangements including services and product selections, maybe even contacted clergy before presenting the final goods/services statement?  When the family is provided and realizes the total amount due, all of a sudden it’s “cigarette and bathroom break time.” Upon their return from break, the financial issues are put on the table which may result in completely changing what has been already painstakingly planned. Basically, because financially issues were not addressed earlier, now the family and the funeral director have to hit the “re-do button” which in my not so humble opinion, is poor service.

Want to know more about providing meaningful and consistent training for funeral directors? Contact stevez@g2funeralgroup.com and have a chat with him about the training programs available. After all, as I have said many times: even professional baseball players take batting practice before every game, how is your funeral home training?  From the Command Post and a thick fog of cigar smoke, Cheers y’all.  See you in Indy for NFDA   #thefuneralcommander

doc n a box

Recently we’ve been made privy to reports from NFDA (2015 Member General Price List Survey) and CANA (Cremation Rate Doubles in 15 Years & Correlation Between Cremation/No Religious Affiliation.  These reports provide excellent data of where we came from, where we are now, and initiates further need to focus on where we are going to meet the demands of consumers in the future.  In fact, Ryan and I discussed these topics at the top of Episode #2 of Funeral Nation which will air Tuesday October 13th.

I have been a proponent of continuous improvement of our funeral service brands from training, technology, services/products provided to the physical environment of where we operate.  This focus in my not so humble opinion is how we will both survive and thrive in the years to come as funeral service providers.  As I was watching this morning’s news, a medical segment was profiling an online or “virtual doctor visit.”

The online consultation is provided by a licensed physician or nurse practitioner though a webcam for personalized treatment.  When necessary, the professionals can submit an e-perception for pick up at a local pharmacy.  Online consultation is for the convenience of the patient and according to this particular story; patients are moving this direction in droves.  Convenience? Eliminating the hassles of scheduling an appointment during “normal clinic hours,” long waits at the ER or urgent care,  and the costs associated with a doctor visit, etc.  This new service allows the patient to remain in their comfortable surroundings and receive consultation; any guesses of what’s in the next paragraph?

As I write at this very moment I can see “we’ve always done it that way” (aka WADITW) smirking and thinking “that’s terrible service and unprofessional.”  Is it?  Similar service is being provided now across the country by savvy funeral directors that are in the quest of continuous improvement.  Yep, total online offerings with the consumer never leaving their comfortable surroundings and the cremated remains delivered to their front door.  Ole WADITW is smirking once again thinking “well, they can’t get a burial done that way and my families would never go for this.”   Yeah, you’re right Sparky.  But make sure and read the before mentioned reports above and maybe conduct some consumer research.  Remember when we heard “nobody will use a dang card instead of writing a check and I need a travel agent?”  Cremation is rising like the Pillsbury Dough Boy’s brother in a 400 degree oven!

As usual, my mission is provide fodder for thought by funeral professionals to consider and discuss.  If you don’t like the message or challenge for continuous improvement, then how about this provocative question: matching suits and ties or not?  From the Command Post and a thick fog of cigar smoke, Cheers Y’all!  #thefuneralcommander #funeralnationtv

At Need Credit SMALL logo

Just last week, the HelpCard sent notice to their funeral home customers that they are no longer providing credit for funeral consumers.  I have written many posts (At Need Payment PlansWho Pays Funeral CostsSecret Sauce) concerning the growing problem of funeral professionals face collecting funds for their goods and services from consumers that have limited life insurance (or none), cash or credit card balances.  At Need Credit is accepting inquiries from HelpCard funeral home customers to provide funeral payment plans.

At Need Credit offers 3 tiers of payment plans to funeral consumers ranging from excellent to poor credit ratings with no recourse to the funeral home. As a note, Danial O’Connor of At Need Credit will be a guest for interview on the October 6th Funeral Nation web show (stay tuned for details of how to view the show).  The problem of consumers having difficulty paying for funeral expenses is not going away and companies offering payment plans/credit to those with mediocre to poor credit is diminishing.  For inquiry, visit http://atneedcredit.com/ for details.  From the desk of The Funeral Commander, cheers y’all!  #thefuneralcommander #funeralnation #funeralnews

Nope

I don’t think there is a single funeral director, funeral home owner or cremation provider in the funeral industry that doesn’t know that the death rate in the foreseeable future is going to steadily increase due to the Baby Boomers moving on the the permanent Villages in the sky.  Funeral industry pundits, soothsayers and oracles are continually propagating the “Boomer Boom” which will place all on solid footing and growth.

Visions of funerals that “reflect the life lived” with cocktail parties, receptions, doves, fly bye’s, movies, and theaters full of mourners wondering how they can “one up” such send off when their time comes dance in the heads like kids on Christmas eve.  If I had sound to enter this written prose, this is where I would place the screech of nails on a chalk board (I bet some of you hear it and reacting as you read this) to get your attention.

The Baby Boom has potential for Bust for many funeral homes.  WHAT?  Captain, you are such an idiot because we are showing more value and charging more…how could we possibly go wrong?  Take a look at the article posted in My Budget 360 regarding the financial posture of the pending retirement of Boomers.  Couple this information with the financial heath of the Boomer’s Offspring and the visions before mentioned reflecting the life lived are for $695 cremation, a box of Bojangles chicken and a Dollar Tree balloon released “in honor of” because “that’s what they would have wanted” are more realistic.

We are entering the convention season which includes seminars and CEU credit classes.  Just for your own observation and edification, take a look at the fall sessions and see if you can find “Strategies to Serve Broke Baby Boomers and Their Families.”  The seminar would not as flashy, hopeful or sexy as the talk of a lifetime, but it’s worth discussing.  From the desk of The Funeral Commander, Cheers Y’all! #thefuneralcommander

3 a

WOW!! What great response to the post Truth Discussion: Part III from literally all over the world; thank you (except to the woman with the handle  “Cougar” that called me a few expletives, but she certainly typified the Southern saying “a bit dog always yelps”).   One of my brilliant readers (a seasoned and well respected industry pro) and I had a long Skype discussion about the funeral industry buying and selling process a few days ago. During our chat, the notion of perceived value was discussed from a funeral product perspective.  The truth is, because of overcapacity many manufacturers of funeral products are in survival mode.

Think not?  Here is a question to ponder:  Especially regarding caskets, if products have such great value…why offer such HUGE discounts? As I mentioned in Part III, I have recently seen a combined discount/rebate over 40% offered for a nominal amount of casket purchases.   Leading with value?  Not a chance…absolutely leading with price!  If the main product manufactured has to be highly discounted to attract/retain customers and if the focus for sales reps is to sell all sorts of ancillary products such a paper goods, “business” systems, urns, websites, etc. then the truth is, things aren’t going so well.

Given this scenario, what are your thoughts? I’d like to hear from everyone your experiences of just how much a funeral industry product/service company wanted your business (discount/rebate, parking lots paved, vacations paid for, etc.).  What are some of your stories and observations?  We all know that just about anyone can be given a name-tag, tour, fed, getting all liquored up on free drinks in the middle of nowhere, entertained with game tickets, rounds of golf and such; but how about some of the more “colorful” attempts at “loyalty development?”

The truth is most funeral directors don’t ever see or get to experience such perks, I suppose that’s why the “Halloween” bags are so important at conventions/expos.  What’s hilarious is some may read this and have no clue of what I’m talking about…oh well.  From the desk of The Funeral Commander, Cheers Y’all!  #thefuneralcommander

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