Nicole Vullo
on
Written by Wanda Sizemore, Homesteaders Director-Training & Development
I have been fortunate to work in many funeral homes throughout my career, from all across the country. I have found that the differences between these businesses are significant, but in a lot of ways all funeral homes are alike: We are all here to serve families when they need us most, and that is true no matter what your role is in the funeral home.
Like many of you, I came to the profession through personal tragedy after the unexpected loss of my mother and brother-in-law. In the days that followed, my family was understandably overwhelmed with grief and stress. When it became clear my boss at the time was not able to offer me the time and space I needed to process these catastrophic losses, I left my employer and accepted a job as a pre-need counselor at the local funeral home.
I immediately fell in love with funeral service and pre-need, and have spent the years since working with funeral homes to ensure that both their at-need and pre-need services meet the needs of their client families, their employees and their businesses. What I’ve found, though, is that many funeral home owners are so busy working in the business, that they don’t know how (or don’t have time) to work on their business. This can be particularly problematic when you’re trying to build a successful program. So, in this article, I’m going to give you a quick crash course on how you can evaluate your pre-need program and steps you can take to correct course and lay the groundwork for a more successful program in the future.
Understanding Your Market
The first step in this process is outlining what pre-need success looks like at your firm. This will be unique to your business. A successful program at a 500-call funeral operation with six metropolitan locations, a reception center and an on-site crematory is going to look a little different than a successful program at 60-call, family-owned funeral home in rural America.
The best way to identify pre-need pain points for your unique business is to complete a market study. Some businesses will work with outside vendors to conduct formal market research. But you can also start by listing out what you already know about your community, and then fill in the holes with informal surveys and open-ended questions. Initially, you’ll want to gather information in three key areas:
- Competitive Landscape: How many funeral homes are operating in your market? What are your competitors doing well? What are they doing poorly? How does your pre-need program compare with theirs?
- Demographic Shifts: How has your market changed in the last five years? The last 10? Are there fewer jobs in your community? More people? Different demographic groups?
- Market Disruption: How have consumer buying habits changed in your community? Is cremation disrupting historic business practices? How has your firm responded to these disruptions? How have your competitors responded?
Being able to answer these questions will help you identify opportunities and threats in your market, which is a good first step in setting goals to respond to emerging opportunities and mitigate the risk of any potential threats.
Setting Sales Goals
The next step is to shift your focus from understanding your marketplace to setting reasonable sales goals. Like your market study, you’ll want to gather sales information in a number of key areas:
- Pre-need to At-need Ratio: This measurement is essential in setting sales goals for your pre-need program. To identify your current ratio, simply take the number of funded funeral plans you sold last year, divide it by the number of at-need families you served and multiply that number by 100. An average market will support a 10-15% pre-need to at-need ratio if a funeral home does nothing but offer walk-in prearrangements. An active, profitable pre-need program should aim higher, often closer to 40 or 50%. If your ratio isn’t as high as you’d like it to be, this may be a good opportunity to reevaluate your goals for annual sales expectations.
- Existing Sales Staff: If you already have a pre-need program in place, the first question you should ask is whether the staff currently supporting the program are the best fit. You can look at this a number of ways, but the easiest and quickest measurements are sales volume, family satisfaction and employee satisfaction. If you are happy with the output of your existing pre-need staff, you’re getting positive feedback from your pre-need families and your sales team seems happy and satisfied with their roles, you likely have the right fit. If not, you may need to reevaluate or reorganize.
- New Sales Staff: If you decide it’s time to make a staffing change, you need to determine what kind of staff your pre-need program can support. In general, around 250 calls can support one full-time counselor for a year, though this number will depend on your marketplace. If you’re asking too much of a single sales counselor – perhaps they’re trying to meet the needs of 300 families a year – or not asking enough, you may need to adjust your staffing. If you determine your pre-need business cannot currently support a full-time employee, you may choose to hire a part-time counselor or identify an existing staff member who is looking for new responsibilities and challenges.
- Compensation: Your compensation system for pre-need staff should look a little different than how you pay your at-need employees. Like all sales personnel, pre-need counselors tend to be motivated by goals (like a monthly and yearly sales quota) as well as corresponding bonuses. If you are not seeing the results you’re hoping for with your pre-need program, you may want to reevaluate your compensation structure (and adjust accordingly).
Evaluating Pre-need Marketing
The next thing to look at is the effectiveness of your pre-need marketing. Marketing your prearrangement services could be an article in itself, so we won’t dig too deeply into marketing strategy here. However, you should ensure that whatever marketing efforts your firm is currently engaging in are part of an overall strategy. Your firm’s marketing should include a mix of mediums – group seminars, direct mail, community outreach, social media, etc. – and it’s important to identify what marketing mix is most effective in your community.
I’ve found that the best way to ensure the success of your funeral home marketing is to set aside time each year to build your strategy and allocate budget dollars. You should also set up regular meetings throughout the year to measure the effectiveness of what you’ve accomplished so far and hold you accountable to your goals.
Evaluating Company Culture
You should also consider continuing education for your funeral home staff. Many of them are already in the habit of accruing ConEd credits as part of their licensing requirements. However, it’s a good idea to offer additional opportunities for your staff to learn skills that can directly impact the success of your business. Selling skills, personal motivation, product training, customer service, merchandising, setting appointments and making phone calls are all important skills that can improve the success of every staff member – especially those who are responsible for your pre-need sales.
You can offer these education opportunities in a number of ways. If you want to implement an informal training program, you could consider asking employees to share tips with their colleagues in areas of their expertise. You (or one of your managers) could conduct more formal training sessions during regular staff meetings. You could offer webinars to employees who work at other locations, or bring in a formal trainer to conduct a one or two-day seminar for your staff. There are also a number of industry leaders that offer free or low-cost training opportunities for funeral professionals.
In addition to the obvious benefits continuing education can offer your business, there’s also a tangential benefit that I have always seen as tremendously important: company culture. Too often, funeral homes separate their pre-need and at-need staff, leading to an unfortunate “us vs. them” mentality. That’s not good for your business, and it’s not good for your client families. By getting all of your staff together to offer continuing education, you can help ensure there is some overlap and interaction that is positive and productive.
I would also encourage you to hold regular staff meetings that include everyone on your team – pre-need and at-need. Invite both groups to share updates on their successes and ask for support from their colleagues in areas where they might overlap (like following aftercare, lead generation, etc.). You can start by having your pre-need and at-need staff address two questions at every meeting: “What have I been working on recently?” and “What can my colleagues do to make me better at my job?”
You might also consider offering cash incentives to staff members who provide leads to your pre-need counselors, incorporating the financial benefits of pre-need into your regular business updates and recognizing staff members who go above and beyond to support your pre-need program.
Fixing the Problems
So, you’ve done a thorough review of your pre-need program and identified areas where you’re not progressing as quickly (or efficiently) as you would like. The final step is to address those problem areas and move toward a more effective pre-need program.
I strongly encourage you to leverage the resources you already have in place – namely the vendors and suppliers you are already using. Often, these business resources have tools and training that can help you address some of the pre-need pain points that exist in your business today. This support can be informal – simply suggesting solutions they’ve found in similar markets, providing access to information from regional or national studies or offering casual insights into marketing and positioning.
You can also investigate more formal relationships through affinity partnerships with other industry experts or affiliated marketing organizations. Often, these third-party vendors can provide the support you need to evaluate the success of your program, implement any changes or restructuring that needs to take place and follow-up with consistent measurement.
And, of course, you can always turn to industry associations and other end-of-life caregivers (like hospice) for additional support and expertise.
Whatever path you choose, you should make sure it is the best fit for your unique business. Ensure you have full buy-in from your staff, and make sure you are holding yourself accountable to your meeting, measuring and reevaluating your goals.