Dan Isard

April 28, 2022

Finance 301: Chapter 4: Pricing Considerations

As I attempt to transfer the knowledge I’ve learned over five decades in funeral service, I find I must ask questions as often as I answer them. Q1: Why is it important to set prices accurately? That sounds like a childlike question, but the way this profession sets prices would be an insult to most fifth graders. In 1985, the Federal Trade Commission (FTC) forced funeral homes to change from a “package pricing model” (the family buys the merchandise and everything else is thrown in) to an “itemized service fee and merchandise-pricing model.” This caused owners to start by guessing how to allocate their fees on the 16 Funeral Rule-required itemized goods and services to account for the loss in revenue caused by dropping the markup on merchandise from about five times to roughly two times. To make matters worse, […]
March 29, 2022

Finance 301: Chapter 3: A Preneed Game Plan

In last month’s column, I outlined the questions you must address for preneed to serve as a positive part of your business and planning. As noted at the end of that article, I intend to answer those many questions in this month’s article, so please, read on. Today, between 20% and 30% of the average funeral home’s annual calls originate from preneed. Now, if you thought that one person in your community would account for 20% to 30% of all your calls in a given year, would you be cavalier about the financial status of this person? Of course not. You would want to know their net worth, their ability to pay in the future, etc. The concept of preneed involves getting consumers to make advance directives, thereby informing their loved ones and the funeral home of the services and […]
February 24, 2022

When Inventory Is and Is Not Inventory

Nothing is more confusing to an outsider to this business than the concept of “inventory” in the cemetery business. Inventory is defined by most financial dictionaries as “the entire stock of goods, materials and components, finished and unfinished, of a business.” Therein lies the problem. The definition does not apply to the unique nature of the cemetery business. I have performed almost 1,000 valuations of cemeteries in my career. Routinely, each and every balance sheet of a business will list items as inventory. Some such items of a cemetery will be identified on their balance sheet as inventory. However, not all items that are called inventory by an accountant are, in reality, inventory because the definition is flawed. Cost of Goods Not a Good Measure Inventory is used in accounting as a “Cost of Goods,” but not all “Goods” can […]
February 24, 2022

Finance 301: Chapter 2: A Preneed Overview

My Knowledge Transfer Plan Chapter 2: A Preneed Overview The first large-scale speech I gave at an NFDA convention was in Orlando in the 1980s. In the room next to me was an industry “expert” whose presentation denounced the use of funeral directors as salespeople and asserted that preneed was an inferior way of promoting funeral home services. From then until 2019, preneed sales rose in almost every category you can look at it. Overall number of contracts sold by the profession increased at least 300% during that 40-year period. The annual number of preneed contracts served increased almost 500%, and the backlog of preneed contracts as “inventory” for future service by any funeral home also increased by at least 100%. In other words, the presenter in the room next door had been wrong. Despite the onset of the pandemic, […]
January 27, 2022

What Does the Cemetery of the Future Look Like?

After almost 40 years in the profession, I never questioned the concept of the “size of a cemetery.” I have seen them 40 acres, 200 acres, and even family and church cemeteries that are only 1 or 2 acres. But those were cemeteries initiated 50 years to 200 years ago. As we exist today in 2022, how big will the cemetery of the future be? Cemeteries in the Past The creation of a cemetery was in many ways a requirement for a “town” to become a “city.” As the town wished to be elevated in sovereignty to a city, it needed to have a cemetery. Usually, that cemetery was built at the edge of the town. People would walk, ride their horses and buggies, and (for the past five generations) drive their cars to the edge of town for burial […]
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