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10nt5i (1)

Quick question:  How much do you currently have in your firm’s Accounts Receivable?  What could you buy right now for your business if that money was in your bank account?  New computers?  A new hearse?  A total remodel?   A new location?  If your funeral home has accounts receivable, your payment policy (immune system) is broken and your firm is suffering from a serious disease.  What I find astounding is that some funeral homes don’t know they are sick.  People die every day because they failed to get regular check-ups and pay attention to their health.  When the news strikes and depending on the stage of the disease, it is sometimes too late for any treatments or even surgery.

Funeral home owners are no different. Ignoring the very information in front of their face; accounts receivables.  I talked to an owner recently with over $300,000 owed for services and products already provided!  The average funeral home has $17,000 in AR’s…folks that over $300,000,000 (three hundred million for those of you that “don’t do numbers, we just serve”) that is due for hard work.

Get a financial check-up.  If you have any money due over 30 days, you’re sick.  It may be a cold (a small amount) or full blown stage 4 cancer.  Funeral Pay Plan has the cure, you just have to take your medicine and it’s easy with the technology is far better that poor Mrs. Edna sending out those letters from the book of promises every month, but few checks coming in return.  It’s just that simple, why won’t you do something to make it better?

From out west in Sunny Scottsdale (yes, I’m in training), Cheers Y’all! #thefuneralcommander

 

Secure Payment

The funeral isn’t over if the funeral home has not been paid in full for services rendered.  I recently read a statistic that the average funeral home has around $17,000 in accounts receivable or past due money owed for services that have already taken place. I have personal knowledge of firms owed hundreds of thousands of dollars. Why?

Funeral home ownership and management has failed. Frankly, simple solutions exist however it takes leadership to change behaviors in the arrangement session and accountability of funeral directors that sign funeral contracts. How? Let’s start with no funeral contract is signed until payment is secured. Payment secured, what does that mean?

  1. Valid pre-need trust with enough funds to pay for goods and services.
  2. Verifiable life insurance-assigned to funeral home by factoring company and fees paid by the family.
  3. Payment in full by cash, check, or credit card.
  4. If any payment above cannot be paid in full, at least 80% of funds must be paid with cash, check credit card or life insurance as a down payment with an approved payment policy in place. If a family cannot pay 80% up front, it’s the wrong service offered by the director.  Reduce services and products to match affordability of the family. If a family can’t pay the majority of the service, the firm will likely not collect the balance due.
  5. No discounts. If a family needs help, use #4.

Of course I know there are extenuating circumstances and funeral directors cry the proverbial “what if the family?”  What if the owner would do their job and train funeral directors process in arrangements to properly explain the payment policy of the funeral home (above 1-5)?  What if owners held funeral directors accountable to not sign a contract until payment is secured?  Here’s what if for you: “What if the funeral director signed a contract without securing payment and if the payment was not collected when due, the funeral director paid out of their salary?” Let that one sink in.

If you think this is all a made up scenario and impossible, then you are wrong. Our funeral homes and cremation company conducts almost 500 services a year; we have $0.00 owed to us.  Want to have the same for your firm?  Contact me 540-589-7821 and we’ll set up a time to further discuss how to lead your funeral home with training as well as director accountability.

Next week I’ll discuss steps how to recover from the failure of training and accountability of funeral directors which resulted in accounts receivable in the “book of promises.” From the Command Post, Cheers Y’all! #thefuneralcommander

 

TFC2

I have conversations daily with funeral directors nationally about funeral payment plans and collecting full GPL prices prior to engaging in a funeral contract.  More often than not I get questions from funeral directors: “What if the family?” I’m going to address some of those questions I get from the field.

What if the family does not have any money?  My immediate response (and yes we have trained our staff and we actually give the same response when asked in an arrangement session): How much is no money?  Not anecdotal, but I literally witnessed this same question posed to a funeral director and the family ultimately paid over $15,000 in cash for a complete funeral!  Does your funeral home train how to provide a response?  When a family says “they have no money” what exactly does that mean?  Most funeral directors dive straight to the bottom without engaging further to better understand the financial posture of the people they “are directing.”  The appropriate response is: “How much is no money?”  Then, close your mouth, listen, when appropriate inquire more, and then create a solution that suits their budget.  I know you’re sitting there saying “what if they have NO money?” Back at your here, what do you do?

“What if the family does not qualify for a loan at FuneralPayPlan.com?”  You go back to the drawing board.  The next step is to let the family know that you will accept a minimum  cash, credit card or life insurance assignment for full payment.  No funeral contract is signed by the funeral director until the payment is secured.

“What if the family can’t come up with the X% up front?”  You are offering them the wrong service and products; they simply can’t afford the current services or product selections!  I wrote about this a while ago “I Only Have Bus Fare But I Want a Cadillac” and basically once you know that a family can’t afford what you are offering, then you must change their options.  If not, you are part of the problem.

“What if the family gets money from FuneralPayPlan.com deposited in their account but they use it to buy something else?”  Well, I guess I can only answer this one: “here’s your sign”

TFC1

I have much more to say from experience and training firms to cash flow better for at need services, so this subject will continue in other posts. This post will generate enough fodder for those that #FNhustle and want to make #FNchange; so feel free to contact me to initiate training to make positive steps to build your #FNbrand. Of course, the others will simply smirk and continue upon their path of “often wrong but never in doubt.”

From the smoke filled Command Post, Cheers Y’all! #thefuneralcommander

 

FD training GP

Getting paid for services rendered and products sold should be as much of a priority as “a satisfied family” for funeral homes.   As a funeral home owner or someone managing the business, securing payment is one of the most important tenets of accountability, but rarely emphasized.  If you don’t think so take a gander of seminar presentation and CEU training provided at the majority of meetings or conventions.  Anyone training funeral directors to collect money due? No.  And most likely not at your funeral home either.

How can a funeral home get paid for every case, every time?  Training.  Why does a funeral home allow a contract to be signed without securing payment first?  Securing payment means a confirmation for pre-need payment, a life insurance policy is verified and assigned for payment, a check or credit card for full payment has transacted, or a payment plan has been agreed upon (signed) which includes a Truth In Lending statement along with full APR calculations of interest.  Otherwise, no contract signature from a funeral director should be made to engage for services.  It’s that simple.

If you are reading post and don’t think that your firm has an issue, I’ll give you a little process to follow:

  1. Look at every case from last month (January, 2016).
  2. Review each goods and services statement for signature of both funeral director and customer.
  3. Check total due amount.
  4. Check date funds received and amount paid.
  5. Is there any amount due today?
  6. If there is an outstanding amount due, why?
  7. If the case was not paid in full, what is the current status?

I offer training to provide funeral homes the path to secure payment prior to contract agreement.  Anything short of $0.00 accounts receivable at a funeral home is simply unacceptable and a direct reflection of poor management.  If you want to get paid, train your staff.

From the Command Post and all payments secured, Cheers Y’all! #thefuneralcommander

 

 

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 Funeral Pay Plan.

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

 

 

 

at need payment

Funeral payment plans used to be an option for consumers pay funeral expenses that did not fund pre-need, had limited life insurance, cash or credit card balances.  The days of funeral homes offering in house payment plans have gone away with the sales of bronze and copper caskets.  Why?

Administering the process of billing, collecting and accounting is a colossal waste for the actual return of the revenue sought after.  Another reason is the age old “when the tears dry up so does the checkbook” theory of consumers failing to pay for funeral expenses over time.  Finally, the credit worthiness of consumers has dramatically shifted in a downward spiral due to continuing unemployment, falling home value and of course other negative economic pressures.

But these folks are dying too and funeral home owners are struggling to maintain a balance between offering services/products that family’s desire with getting paid for services rendered.  This dilemma is not new and I have written several posts At Need Payment PlansDon’t Ask the Kids to Pay, along with Is it About Honoring the Life or Paying the Bill?  This “underbelly issue” of the funeral home business is not being addressed and is one that will continue to grow as fast as the shift from burial to cremation.

Think I’m wrong about this?  Take a look at all of this years (2015) convention and meetings.  How many seminars were presented that shared how to deal with consumers that are financially struggling, how to bridge the gap between wants of families vs. revenue generation, or cash flow solutions for at need funerals?  Nope, we still are listening to the soothsayers and pundits blithering about “charge more/show more value,” “how to market your funeral home (with no measurable results),” along with other subjects that are basically repackaged from the last seminar offering nothing remotely important to serving the broke ass consumer (I threw that in just to see if anyone reads this far down and paying attention).

Over the coming weeks I’m going to further delve into this particular subject and offer solutions.  At this very time I am working with a team of lending experts and organizations to create new a suite of funeral payment plans that will be offered by Funeral Pay Plan with several choices of options that funeral directors may choose based on their particular needs.

The new roll-out will be in January and will include everything from offering payment plans to excellent credit consumers, poor credit rated consumers, billing opportunities to accounts receivable collection.  If you know me, it’s not just talking, it’s all about execution.  The Funeral Commander is “getting it done” for funeral payment plans. From the command post through the smoke of a fat maduro cigar, 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 me! 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

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

who pays Who pays funeral costs? As part of an ongoing conversation on this funeral blog the debate continues regarding payments for  funeral and cremation services by consumers.  Traditionally, the burden of making sure that a deceased person’s funeral bill is  paid to appropriate entities such as the funeral home and cemetery are primarily upon the deceased’s survivors.  However, a  growing trend is shifting from family to governmental agency responsibility and expectation of services without securing  necessary payment.

Are choices of disposition based on the amount of funds available to be paid for services?  Rising costs of funeral goods and services are no different from any other; a hotel room or an oil change all cost more than even 5 years ago.  Payment for goods and services are secured promptly or you don’t get your room key or car keys returned. From these two analogies, are funeral professionals compelled to “give the room key” or “returning the car keys after the oil change” without payment?  In essence, if a consumer can’t pay for a particular hotel room or vehicle service, then they can’t get the same level of accommodations or the vehicle service desired. Why the expectation that funeral proprietors should provide desired level of services without equal payment for such services?

The subject and issue is not going away…the “I am struggling to pay” segment of consumer is growing faster than “can I write you a check, use my credit card or use the life insurance” consumer.  What is your experience?  Cheers y’all.

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