Apple has been seeing sales of its iPhone declining.  The product, which makes up about 1/2 of the company’s sales, dropped in sales revenue another 10% in the last quarter according to Apple’s 2Q Financial Report which came out last week.

 

According to this article however, Apple had a jump of about 14% in “Service Revenue” for the latest quarter.  And it is this service revenue that is growing the company’s margins to record highs.

 

 

So, my argument is that Death Care is losing number of unit sales in caskets and vaults and the best way to make up those losses is somehow to make “high-margin” professional service sales when possible.  In Death Care this is difficult to do, such as getting additional professional services revenues on cremations. . . . and especially on Direct Cremations with No Services (DCNS).

 

However, in a world where cremation is continuing to grow both percentage wise and raw numbers wise, it is imperative that funeral homes work as hard as possible to get professional services added to the cremation clientele.  Especially when some experts predict that in the not so distant future, DCNS cases will make up 70% of all cremation cases.  It’s my estimation that most of that business is somewhat price sensitive, but I also suspect that there is a certain amount of that clientele that is somewhat naive as to what additional services can come with cremation.

 

This goes back a ways, but this is what worked for my funeral home. . . . .When we saw the advent of Direct Cremation with No Services we put an “Ancillary Package of Services” together that came with a free ornamental urn.  What we noticed is that many of the DCNS client families preferred to receive the remains in something other than a plastic or cardboard urn and would pay for what was most of the time an inexpensive urn that was ancillary income, but had little margin to it.

 

We put packages together that offered a free urn with the purchase of either a “Visitation without the Body Present” or a “Memorial Service” package.  We purchased in quantity urn vase models for about $50 in several different colors and then offered a selection of one free of charge when families chose one of the two service packages.

 

In our case, let’s say that the DCNS at our funeral home ran at $1995.  We then offered the “Visitation” package at an additional $800 and the “Memorial Service” package at an addition $1,200.  It’s amazing how many families had never thought about those types of selections because they believed that the costs would be prohibitive.  A high number of families selected one or the other. . . and the free urn was an incentive that they appreciated.

 

While $800 or $1,200 is not alot of money to the funeral home, every little bit helps.  And, if you have staff available for a period of time and chapels not being used it’s a lot like an airplane flying with an empty seat — revenue lost forever as the time slips by.

 

In addition, the “package” often led to more sales for things as memorial folders or hospitality luncheon rooms.

 

If you are not offering some type of incentive led package to families who call you for a simple direct cremation, you’re letting revenue walk out of the funeral home.  The client family may even be thinking of doing something like this at a park or some other venue and you can let them know that you have a “made for this” venue right here.

 

You need to watch your pricing so you don’t cannibalize your other services by offering an incentive-led package, but done right it is an opportunity to bring in high-margin service dollars to your business.

 

Product note — Depending on the family you are serving and the costs involved it may not be an urn as the incentive. . . . it could be individualized personal jewelry which a family may appreciate.  However, it is all about the cost of the incentive product in relation to the services revenue you can receive. . . . There has to be a proportion that will work for your funeral home pricing.

 

More news from the world of Death Care: 

• A calling to serve.  The Catholic Sun
• Lindquist Mortuaries celebrates Ogden expansion with ribbon-cutting ceremony.  The Standard Examiner
• In this tight labor market, interest in funeral service work is growing.  National Law Review

 

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