Skip to main content
Toll Free Number: (919) 280-1217

Author: Alan Creedy

Knowing Too Much Causes You To Underserve Families

Written by Alan Creedy on . Posted in The Creedy Commentary. 1 Comment on Knowing Too Much Causes You To Underserve Families

tapping fingersSome years ago a study was conducted. A group of people were divided into “tappers” and “listeners”. The tappers were asked to pick a popular tune and tap it out and the listeners were asked to identify it. The study found that the “tappers” predicted that the listeners got it right at least 50% of the time. Actually the listeners only guessed the tune 3 times during the whole study. The researchers concluded that the reason for the disconnect was that the tappers could “hear” the tune in their head and therefore misled themselves in thinking they had fully communicated with the listeners…when, in reality, they hadn’t.

So what does this have to do with funeral service?

I think the biggest lesson for me is that, as an expert, we know what we know so well that we convince ourselves that others who don’t know what we know will fill in any blanks.

The reality is that they don’t know what you know. They don’t know the options, why’s or wherfore’s of any of it. This explains to me why so many families are so grateful and so easily trust those funeral directors who will take the chance of making sure they understand the options as well as the potential consequences of any decisions they make.

Ultimately, I have always believed we have a moral obligation to explain all the options to ALL the people ALL the time. Those that do so consistently report greater family confidence, greater job satisfaction, and, of course, better revenue. But the best part is the significant improvement in relationships with their customers.

The Lesson:

Stand up for what you believe and tell it like it is.

Merchandising Rental Caskets

Written by Alan Creedy on . Posted in The Creedy Commentary. 4 Comments on Merchandising Rental Caskets

I like the approach demonstrated in the attached picture.

My friend, David Storke, shows this wicker green burial casket on top of his rental. He tells me that he no longer has any trouble explaining “combustible” caskets to his families, the wicker casket is a great conversation piece (he has sold 2 for “green” burial) and it helps sell the rental casket below it. Note the wicker casket is $1,375 and the rental goes for $1,175.

wicker and rental casket

While we are on the topic: I know that not everyone agrees with rental caskets but if you are going to offer it why not offer 3 at different price points (good, better, best).

Part 3: The Owner Is Ready

Written by Alan Creedy on . Posted in The Creedy Commentary, Money: Getting it and Keeping it. No Comments on Part 3: The Owner Is Ready

Maybe you are anxious to exit your business. Or perhaps you dread the day you will no longer be involved. Either way for a successful business transfer you need to be ready.

It has been my experience that when people think they are ready and even eager to exit the business they have only given thought to what they are “getting out of ” and little if no thought to what they are “getting in to.”

It is one thing to be sick and tired of the daily demands of funeral service and the accompanying stresses. It is a much different thing to step into a new life and realize that you no longer can enjoy the perks of your former business. Not too long ago I had a client just like this. Since the sale he has tried a variety of ventures but found none as lucrative or satisfying as funeral service…in spite of its challenges.

Or, perhaps, you don’t want to leave. You love what you do and can’t see anything else as satisfying. I see nothing wrong with planning to remain active as long as your health permits. But therein lies the catch…“as long as your health permits.” I have another client, now in his 80’s, whose health has declined precipitously. So much so that he has been unable to work for more than two years. He and his family are entirely dependent on the good will of his employees and particularly their key man.

So, while I don’t see anything wrong for you to plan on remaining active for your lifetime, I believe it is morally wrong for you to leave your family and employees AND customers to clean up the mess you leave because you were too stubborn to adopt a continuity plan or even maintain a disability insurance policy.

So whether you are anxious to leave, or plan on “dying in the saddle” you owe it to yourself to think about and plan for life after the sale. To get yourself and your family ready for that 100% chance of eventual transition.

Begin with answering some of these questions:

  • When I am no longer THE funeral director is it important that I still be needed in some capacity?
  • If I am no longer involved what will I do to replace my need for purpose?
  • How will I occupy my time in meaningful ways?
  • If I died or became incapacitated while still working do I have written instructions on who to contact and what to do?

A final thought:

Some years ago two of my clients (independent of each other) appointed me as executor in their will. Their reason was they felt I would “take care of their family.” I was honored. The problem was they didn’t tell me until some time later. So, had they died, it would have been a surprise for which I might have been unprepared. Maybe I would be willing to perform that function but am probably too old now. HOWEVER, I have often reflected on their thinking and believe their thinking was sound. It would be a great idea (especially if you are in a study group) to ask a couple of non competing colleagues to act on your behalf of your family during a transition. BUT, you should not ask someone who might be interested in buying your firm as it would be a conflict of interest.

 

Part 2: The Business Is Ready

Written by Alan Creedy on . Posted in Money: Getting it and Keeping it. No Comments on Part 2: The Business Is Ready

I have lived in my house for 30+ years and we are getting ready to sell and move closer to my daughter and her family. I have two goals:

  1. Sell for top dollar
  2. Sell quickly

So we are getting it ready by repainting it and updating a few odds and ends. Not more than we can recover but enough to meet my goals.

So it is with a business. It is a serious mistake to try and sell a business without doing some preparation first.

There are 3 value drivers that make up the value of a business:

  1. The quality and size of the earnings
  2. The quality of the staff
  3. The quality of the physical assets

Quality and size of earnings

By quality we mean consistency year over year of revenue and expenses. Ideally, your volume and average sale are both growing. Your cost of sales is remaining proportionate (15% to 17% of net sales for most firms). Your overhead is going up at a pace less than your average sale and your EBITDA is going up. Your as close to debt free as you can manage.

Last, but by no means least, your tax structure is such that it minimizes taxes. If you are a “C” corporation you should get your accountant to switch to a pass through entity like subchapter “S” or LLC. The rules on Subchapter “S” phase in were just reduced to 5 years. Your real estate should be owned personally or in an LLC.

In my experience if your business does not meet most of these expectations I usually recommend we delay putting it on the market until we can show at least a year of improvement. Most often we can make significant performance improvements quickly.

Quality of Staff

No matter whether you are big or small this is an important factor. If your business is solely dependent on your personal involvement on a day to day business it will have a negative impact on your business; especially in smaller communities.

Your staff should be trained, if not well trained. They should know what to do in your absence and be able to handle most contingencies without calling you. More important, your customer base should be linked to the business…not to you.

If your plan is to sell to a third party that will not personally come live in the community then you should have at least one staff member prepared to take over your role within a short time of the sale.

This is not to say that you won’t be needed afterwards but prepare yourself emotionally to decrease in importance within a reasonable period following the sale.

If you have important and key staff who might be tempted to leave if you are no longer involved you should seriously consider non competes and, possibly, implementing a “stay” bonus option to encourage them to stay long enough for an orderly transition.

The Quality of Physical Assets

Buyers prefer not to buy properties that will soon require significant capital investments. A coat of paint, even a new roof will help get the business sold.

No, you don’t have to (and please don’t) go out and buy a new fleet. But your vehicles should be well maintained.

You should also make sure that your properties are clean and look cared for. You won’t always know when a buyer is inspecting so make an effort to keep everything looking good.

 

Universal Requirements For Successful Family Transition

Written by Alan Creedy on . Posted in The Creedy Commentary, Money: Getting it and Keeping it. 1 Comment on Universal Requirements For Successful Family Transition

There are 3 Universal requirements for a successful family business transfer:

  1. A competent successor
  2. The Business is ready
  3. The owner is ready

Part 1 – A Competent Successor

A successor is competent when they have demonstrated both the ability and willingness to run the business.

For most small businesses however this is a major challenge. Yes some successors (children or employees) really aren’t willing or are unable to rise to the challenge of ownership. But a more common reason is that the current owners have failed to do three things:

  1. Clearly articulate the performance expectations they need to see.
  2. Provide both internal and external experiences to develop skills and abilities while providing a well – rounded world view
  3. and biggest of all, implement a phased exit process that will ultimately make themselves unnecessary while stretching the successor’s own commitment

Performance Expectations:

I frequently get requests to help develop successors (both employees and children) for taking on ownership as the current owners begin to look forward to retirement. Sometimes friction has developed because the successor(s) are too anxious to take over and want to change things too rapidly or too aggressively for the current owner’s comfort level. Their attitude is I am ready now why doesn’t he / she just get out of the way. More often, the successor is stuck because they can’t quite figure out what is expected of them or they can’t get a chance to really assume a specific role.

Most current owners want the successor to demonstrate that they can be a great #2 before they are willing to think about giving up some of the ownership responsibilities. Worse some owners  have forgotten the struggles of their own learning curve and think the successor should somehow just “know” what to do. Other owners remember that learning curve too well and think that they have to impose the same thing on the successor(s) even though their learning curve may now be irrelevant in today’s business environment.

I always start these projects by having the owner tell me as clearly as possible what a successful #2 would look and act like. If they need to see them voluntarily working 60 hours a week or taking night calls so be it…but say it. As you might expect very few have thought about what they want to see…they just expect to see it.

As an added service I offer this link to a successor readiness assessment. I wish I had developed it but it comes from none other than the world renowned management guru: Peter Drucker.

Internal and external experiences: 

If you don’t provide opportunities to grow and develop both internally and from outside sources then you are only going to get what you already have: “Successor Interrupted.” My favorite mechanism is having your kids work somewhere else for a period. This does a couple of things:

  1. Exposes them to alternative thinking and methods, both good and bad
  2. Allows them to demonstrate to themselves they can succeed without being the “heir apparent.”
  3. Helps them develop a perspective relative to both what it’s like to be an employee and the unique environment of your own business.

Another alternative, of course, is to send them to conventions as long as you make sure they understand the “10 percent” rule: 10% of whatever you hear is blatant exaggeration.

I structure my “Blue Ocean Tours” specifically to provide these experiences via workshop immersions.

Make Yourself Unnecessary:

This may be the most emotionally taxing for most funeral directors. But if you aren’t willing to delegate increasing responsibility to your staff / kids then you are not ready to exit no matter how tired you are.

There is a great litmus test for this. You might want to sit down before you read it and have the smelling salts ready: Leave for 30 days AND DON’T CALL IN. If you get back and the business hasn’t really missed you it’s time.

Next week: Part 2 Getting Your Business Ready

Should Women Wear Pant Suits?

Written by Alan Creedy on . Posted in The Creedy Commentary, Practitioner Forum: Insights and Ideas. 12 Comments on Should Women Wear Pant Suits?

style-9091-slim-fit-notch-lapel-one-button-angled-flap-pocket-mid-hip-length-womens-pant-suit-for-work-with-plain-front-wide-leg-pantsI seem to have a penchant for joining fights that aren’t mine. Not long ago I was presenting a seminar on dress and decorum to funeral directors at a large state convention. Several women asked for my opinion on wearing pants. Frankly, I hadn’t thought about it so I didn’t have one.

Since then, I have been doing an informal survey. It seems that many funeral homes require a dress or skirt be worn by females at all times.

I have learned that a dress or skirt can often be awkward at the most inopportune moments. While I can not report based on experience, I am told that certain physical activities necessary to the profession (i.e. removing bodies, lowering caskets at the cemetery and so on) cause a skirt or dress to “ride up” resulting in exposure or forcing the hapless female to simultaneously adjust her clothing while attempting to help their colleague.

Since I have been asked for my opinion I offer it here. If I owned a funeral home I would allow my female staff to wear Professional style pant suits. I would also encourage them to wear skirts or dresses at visitations and receptions where the risk of embarrassment would be less.

And while I am at it my wife says I should also remind women that not all women look good sans pantyhose. (Again, I wouldn’t know this personally)

Funeral Home Evaluator

Thumbnail: What’s It Worth?

Written by Alan Creedy on . Posted in The Creedy Commentary, Money: Getting it and Keeping it. No Comments on Thumbnail: What’s It Worth?

A lot of my readers are curious about what their business is worth but aren’t yet ready for a full valuation. They just want an idea.

Well, as you can imagine that gets kind of messy. There are a lot of moving parts in a valuation; but if you just want an educated guess click on the icon below and it will take you to my Opinions page. Scroll down and you will find a “Ball Park Calculator.”

As I say repeatedly this is no substitute for the analysis of data, experience and professional judgment a valuation involves. If, however, your firm is similar to the majority of firms it will be close.

Have fun!

baseball-diamond

 

Is Funeral Service Ready For Innovation?

Written by Alan Creedy on . Posted in The Creedy Commentary, Practitioner Forum: Insights and Ideas. No Comments on Is Funeral Service Ready For Innovation?

Uhhh…NO!

HBR-logoI got an email from Harvard Business Review today. It invited me to take an assessment on innovation readiness for my company. Instead, I took it as if I worked for all of funeral service as I know and experience it. The results weren’t surprising but still disturbing. I did my best to be positive in my answers but they were pretty convicting.

You should take it yourself. Click here to take The Harvard Business Review Innovation Readiness Assessment

Want to see a copy of the report I got representing my opinions of funeral service? Click here: Funeral Service Innovation Assessment

 

Employee Pushback – A Strategy

Written by Alan Creedy on . Posted in The Creedy Commentary, Leadership. 1 Comment on Employee Pushback – A Strategy

Grumpy Old Man --- Image by © Ned Frisk Photography/Corbis

A client and friend of mine recently spent days revising the staff schedule to be more efficient and effective. He took great pains to think about its impact on staff and did his best to devise a plan that would work best for the funeral home AND create the least inconvenience for his staff. After he finished explaining it to staff at a staff meeting one of his staff members pushed back hard. This resulted in others joining suit (crowd mentality).

The problem was not that it was a bad schedule. In fact, it was a much better schedule. The problem was that it was a different schedule and the staff was used to the old one and had adjusted their lives accordingly.

My client felt like he lost control of the meeting and called me to ask how he should handle it.

He was mad, especially at the instigator. But really he was hurt because the staff had not appreciated the pains he had gone to consider their needs.

What should he have done?

Today’s management philosophy is to let staff have their say and listen carefully. Certainly that is good advice. But what most people miss is that their say should be mutually constructive. In other words, pushing back is always destructive and should be stopped in its tracks.  A collaborative approach requires that insights and alternatives be offered that make the solution better. If the intent is simply to resist then, at least in my mind, they immediately surrender the privilege of input.

So, here is what I would have done:

  • I would have taken time to listen to their input but not their complaints.
  • If they offered no constructive insights or alternatives I would tell them so:
    • “All I hear from you is negative and that’s not how we operate any more.”
    • Then I would shut up and it would be on them to respond constructively
  • If they offered constructive insights I would summarize them and tell them what adjustments I plan on making or if I needed to think on their insights.
  • Either way I would restate the company’s vision and mission to remind them of our community purpose.

What I would not do:

  • Waiver or appear irresolute
  • Get mad
  • argue defensively
  • whine
  • Appear frustrated

A good thing to remember:

You are the adult

Finally, if I had a chronic offender who simply seems determined to undermine me in every way (what I call the “ten call man”) I would let them go… and I might do it publicly to make a point.

If you fail to walk in your god – given authority someone will take it away from you and use it against you.

The Lesson of the $300 Shoes

Written by Alan Creedy on . Posted in The Creedy Commentary, Practitioner Forum: Insights and Ideas. 6 Comments on The Lesson of the $300 Shoes

Blucher-BalmoralLast week’s blog sparked a lively conversation on and offline about clothing. From those conversations I think it might help to add one more insight.

It was 1989. George H.W. Bush was president. I had just come from a podiatrist because my feet were in constant pain. I have flat feet. My prescription: wear only tie shoes with “blucher style” laces. (see photo blucher is on the left)

I happened to be walking through the shoe department of a local men’s store when this ancient man (95 year old Mr. Eggerton) hailed me with “Your shoes are too small.”

“How do you know?” I responded.

“I can tell by how they crease.”

That man knew shoes and feet. I told him my story. Up until then I had been wearing Johnston and Murphy which I thought pretty expensive at $125 a pair.

Mr. Eggerton introduced me to Allen Edmonds brand. The $300 pair put me in shock and I had to go home and think about it for a couple of days.

I remember Mr. Eggerton’s parting comment: “These will be the least expensive shoes you ever buy. If you take care of them, resole them and reheel them as needed, you will be wearing them 15 years from now.”

I still have those shoes. I have lost count of the resoling and reheeling. They don’t look exactly new but they are still very serviceable as dress shoes. And, boy, do they take a shine.

I learned two lessons from Mr. Eggerton:

  1. There are experts in every field no matter how humble. Find them and listen to them.
  2. Inexpensive clothing is an expense and expensive over time. Quality clothing looks better lasts longer and is often significantly less expensive. Quality is a long – term investment. Those $300 shoes (excluding reheeling and resoling) amortized over their 26 year life now have an annual cost of $11.53.