This is happening more and more. .and for good Reason

I read an article that you can read here pertaining to what is announced as a merger, but in reality looks like an acquisition.  This announcement talks about two funeral homes in Ohio that have “merged” operations.  It is about the Billow Funeral Homes and Crematory and the Bissler & Sons Funeral Home and Crematory.

Rick Bissler began planning for retirement and knew that he had no family members in place to succeed himself.  That is a common thread in many of these type of unions.

Funeral Director Daily take:  Combining two cooperating or competing funeral homes into one funeral home has a lot of advantages for the businesses and the community as well.  It has been going on for a long time and will continue to go on as long as good can come from it.

There is a lot of good that can come to the business side of the equation as funeral service continues to try to lower costs to consumers to keep funerals relevant.  Purchasing our competitor and “merging” the business into our on-going business was, not only good for the financial performance of our funeral home, but I would contend, for our community as well.

Here is how I looked at it.  We had built a new funeral home – our first new funeral home building since about 1940 – a period of 70 years.  We had room to absorb more services into the facility.

We then reached an agreement to purchase our competitor and bring their employees into our fold.  We were able to consolidate costs from operating two distinct businesses into one business operation.  Where the two funeral homes together had two facilities to pay for, two property tax bills, two utility bills each month, two receptionists on duty, two funeral directors on call nightly, two marketing and advertising bills each month, and on and on.  With the consolidation into one building, we had one tax bill, one utility bill, one receptionist, one director on call, etc.  We saved considerable amounts of money. . .so much so that what we saved by combining into one facility. . it was like we had no payment for the acquisition costs.

I told our staff, this will work. . . you can all get less nights on call and higher compensation.  However, we have to give unbelievable service  (110% all the time) because if we don’t consumers will look at us as “large and lazy”.  Secondly, even with brand new facilities and more staff and services than anybody else, we had to have a lower price point than others.  Our goal was “Fair priced, Quality, and Volume”.

At the end of the day we ended up with volume larger than the combined two funeral homes.  In essence, we grew volume by our operation – partly from a growing community, but partly from cutting into our neighbors volume because of what I believe was our price/quality metric.

What I did not really realize but came to learn after our merger was that the consumer really liked that they no longer had a decision between which of the  two funeral homes to bring their loved one to.  We had been fierce competitors and most families in the community knew us both.  To many in our community, at the time of death, the highly publicized choice of which funeral home to use – because they were friends with both owners – really bothered them and actually caused consternation among family members.  The decision to “merge” or “combine” actually gave community members a better feeling about calling the funeral home with their mind at ease.

So, I truly think it is good to look at combining in a community when the occasion arises for potential business profit motives in this day of potentially lower revenue per case.  However, you may want to also look at the idea as a favor to the community you serve.

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