2023: The Year of the Ancillary Sale


Last Friday I printed a story about five trends or happenings that I saw in calendar year 2022 and how they will relate to Death Care as we move into the future.  I’ve not been shy about saying two things are happening and will continue to happen.  Those two things are an increase in Direct Cremation with No Services (DCNS) and that operating costs, because of the inflationary environment of the times, will continue to pressure funeral home margins going forward.


If a business does find itself in a situation where service revenue per case is on the downward trend and operating costs are on the upward trend, they have to do something about it.  A business could try to “move” DCNS clients to cremation with services or a casketed viewing prior to cremation to raise the amount of revenue coming in.  Or you could try to convince cremation families to opt for earth burial.


You could do those things. . . and in some cases you would probably be successful.  However, as I found in operating our funeral home, families that had cost consciousness on the mind were never easy to move even if they saw some value in doing so.


So, how do you combat that lower revenue and higher cost situation?  Well, you could do it by increasing your market share and doing more services.  However, many smaller funeral homes are in finite death areas and the market share, in the funeral business, in any given year changing to a substantial increase doesn’t happen very often.  Raising that market share a substantial number many times takes years.


We improved revenues and margins per case at our funeral home by making sure that client families, and future clients through preneed, knew about all of our services.  Make sure those families know about your catering or reception offerings.  Make sure that they know about your monument business.  Make sure that they know of your cremation jewelry or solidified remains offerings.  Make sure that they know your services can be livestreamed.


Or offer “Package Offerings” to cremation families that might include a columbarium space at the local cemetery or an earth burial of cremation remains with a cemetery lot and monument included.  You may not receive a “mark-up” because of cash advance laws in your state on the columbarium at a cemetery or on a cemetery lot, but with those in the price package you are setting yourself up to receive revenue for a columbarium committal service or a cremation graveside service with the sale of a monument.  It’s my opinion that many times families do think about interring cremated remains but the lack of necessity to do so with a cremation, as compared to a full-body interment, creates no timeline to do so.  Because of that, many cremations are brought home. . . never to get to the cemetery.


So many products are unknown to the death care consumer that many times products go unpurchased simply because death care clients don’t know of them or are uneasy about inquiring about them.  I learned a lesson on the power of suggestion a long time ago and how successful it can be.  In the accounts receivable side of the funeral business our funeral home many times had families that came up on their “cash available” limit and we had to carry them financially.  And, it was uncomfortable for me to bring up all of our payment policies.


Tom Anderson
Funeral Director Daily

I was told to put up one of those “Visa” plastic table cards on our arrangement table.  Families could not help but see that card during the arrangement conferences.  Then, many times without saying anything, families would bring out the Visa to pay the bill.  The power of suggestion was awesome for us with that issue.


So, make sure that you have “sight suggestions” in your arrangement office about cremation jewelry, solidified remains, monuments, and more to help with ancillary sales.  And, don’t just start with at-need cases, start building your ancillary sales in the preneed arrangement conferences.


For cremation families make sure you ask them and have them check-off what will be done with cremation remains.  Do they prefer a columbarium, an earth burial, cremation ashes, cremation jewelry, or solidified remains such as Parting Stone as their preference.  If they choose columbarium, earth burial, or cremation ashes you can then lead into an urn presentation.


You could even go one step farther for at-need cremation families if legal in your state.  The question of how they want cremated remains handled or returned to them could be listed right on the cremation authorization form.  Doing so, makes sure that every client family deals with that question — columbarium, earth burial, cremation ashes, cremation jewelry, or solidified remains.  And, even if this question may lead to more revenue for the funeral home, I think it is valuable for the consumer also. . . making sure that they have considered all the options available to them.


From my point of view, as we head into 2023 I see funeral home operating margins being squeezed.  However, it is my opinion that you have some ability to quell that tide by making sure that all families know of what ancillary services that you can provide.  My guess is that by knowing, they may purchase some.


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