3 Problems that Prevent Funeral Home Growth


Do you know what is holding up the growth of your funeral home business?

In this newsletter, I’ll outline the three most common issues that stop a funeral home from growing to its full potential.

A good analogy is to think of your business as an airplane.

The cockpit is for your leadership team. They set the direction, steer the plane, and keep everything running.

You have two engines that propel the plane forward. One engine is your marketing, and the other is your sales. Marketing’s job is to bring qualified prospects, and sales is responsible for converting them into paying customers.

The wings of the plane are the products you offer. They have to be items that people value and are willing to pay for, or your plane will never get off the ground.

The body of your plane or fuselage is your overhead. The engines and wings have to work together in order or to lift the body off the ground.

And last but not least is your fuel, and that represents your cash flow. A business without cash is like a plane without fuel; it’s only a matter of time before it crashes.

Your business is an airplane and is meant to soar, but something is holding it back. Here are the three most common problems that I see in my work with funeral home owners.

Problem #1 – the body is too big for the wings

Remember, your wings are your products, and your body is your overhead. For most funeral homes, the primary product is a traditional funeral, and the overhead is the mortgage and staff.

But what if your most popular product is a direct cremation and your large impressive funeral home has an equally large mortgage? Your wings and body are out of balance, and you’ll never generate enough lift (aka profit) to get off the ground.

An excellent example of a firm that has found a good balance is Newcomer Funeral Homes. They are in nine states and growing and offer traditional funerals at a lower price than their competition.

Even though the traditional funeral market is declining, their plane is flying quite well because they keep their overhead low. Rather than having large, expensive funeral homes, they typically have a small, single-story facility.

Lower overhead = lower prices = strategic advantage = growth

I’m not saying that you need to get rid of your big beautiful funeral home. But I am saying your products need to pay for it or something needs to change.

Problem #2 – too many engine problems

Someone calls your funeral home and asks about your price for cremation. A Funeral Director gives them the price and hangs up.

That’s an engine problem!

You’ve spent money on marketing, and it worked because a prospect called you. Now someone has to convert the prospect into a customer, and that process is called a sales conversation.

I know what you’re thinking “but John my Funeral Directors are not salespeople”.

Anyone whose job is to convert a prospect into a customer is functioning as a salesperson at that moment. They don’t get to be a Funeral Director until there’s a funeral to direct.

Always keep in mind that selling is not about manipulation; it’s about conversations. Your Funeral Directors need to be able to have a conversation with a prospect, or they shouldn’t be answering the phone.

There are many different marketing and sales engine problems. The one I just outlined is the most common and the easiest one to fix.

Problem #3 – the wrong people in the cockpit

Funeral Directors are, by nature and training, consensus builders. They help families reach a consensus on a funeral plan and then manage the execution of the plan. The problem comes when a Funeral Director becomes a funeral home owner and applies the same approach to business leadership.

Some of the most dysfunctional funeral homes I’ve worked with have rogue team members and an owner trying to build consensus. That’s a recipe for disaster.

You must be very careful about who you allow in the cockpit. They must be strategic thinkers who understand how the plane works and how to fly it. When I consult with a client, I join them in the cockpit, and we fly the plane together.

Sometimes my presence annoys the rogue team members, and they decide to leave. I’m okay with that decision because the owner needs to fly the plane and watch their fuel gauge, not spend time dealing with unruly passengers.

Those are the three most common problems I see that prevent a funeral home business from reaching its full potential.

  1. The body is too big for the wings
  2. Too many engine problems
  3. The wrong people in the cockpit

Fix those problems, and your plane will soar.

Until next time,

John

John Callaghan

Fractional Chief Marketing Officer for Funeral Business Builders

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