January 30, 2019
Published by 
Kevin Kruger on January 30, 2019
Kevin Kruger on January 30, 2019The funeral service business used to be more about service than about business. Almost all bodies were casketed and once the family picked the casket, the bulk of the funeral arrangement pricing was already determined. Many family owned businesses also had a trusted accountant or other advisor who would meet with the owners to discuss pricing, managing expenses and measuring profit. The FTC rule requiring an itemized GPL ended the decades of easy pricing systems. The increase in cremation as a disposition choice has altered the economics of death care. The trusted family accountant is also more often a memory of a different era than a reality of today’s world. Unfortunately, the economics of running a business are not adequately taught in mortuary school and many owner/operators do not have the knowledge to make the best choices when it comes […]
October 9, 2018
Published by Kevin Kruger on October 9, 2018
Kevin Kruger on October 9, 2018The numbers tell the story of how cremation is affecting cemeteries. They also show how learning to appeal to cremation families can help cemeteries extend their active lives, selling post-need as well as at-need and pre-need. The steadily increasing cremation rate has caused a profound shift in the funeral service industry. Much analysis has focused on the funeral home side of the industry as funeral home operators have been struggling with decreasing merchandise sales and reduced usage of their funeral home real estate (and associated revenue) for visitations and funeral services. The other primary component of the funeral service industry is cemeteries. Historically, their business model has been the sale of in-ground burial interment rights or above-ground entombment rights for casketed remains, along with related services and merchandise. If funeral homes have been struggling with rising cremation rates, one would […]
August 15, 2018
Published by Kevin Kruger on August 15, 2018
Kevin Kruger on August 15, 2018Properly pricing services and presenting families with all of their options are the keys to operating profitably. Cremation as a disposition process is increasingly embraced by consumers of nearly all religious, economic and regional groups, and the reasons for choosing this option are nearly as diverse as the individuals themselves. While it’s true that some perceive cremation as more economical, others simply have an aversion to ground burial or entombment in a mausoleum. Some see cremation as the greenest option available and believe it’s the most responsible ecological choice. Unfortunately, there are far too many funeral home owners/managers who focus on the economics of cremation as the sole contributing factor of consumer decision making. This preconceived notion then tends to affect the style of arrangement process for families choosing cremation, as well as the pricing of cremation options on the […]
May 10, 2018
Published by Kevin Kruger on May 10, 2018
Kevin Kruger on May 10, 2018Some of you may be familiar with The Foresight Companies as a provider of a range of financial consulting and accounting services. As director of business analysis for Foresight, one service that my department provides our clients is an annual review of their pricing and General Price List. Our process involves producing a realistic budget to accurately forecast anticipated overhead. We then compare GPL pricing to see how likely you will be to exceed the target. I have looked at dozens of GPLs in the last two months and am repeatedly struck by a consistent mistake that funeral home owners make in pricing the Federal Trade Commission-mandated direct cremation package. Let me first lay out several assumptions that lead me to this conclusion. Funeral service is undergoing a significant transformation with the nationwide increase in the cremation rate. Some families […]