In this blog, we share five simple ways to make sure your website functions as the front door to your business and keeps your digital doorbell ringing regularly.

1.  Keep it simple.

More than half of web users give a website about 15 seconds to capture their attention. That’s not much. Copy and content that is clear, concise, and to the point helps considerably. Your homepage should be inviting and informative without being heavy and overwhelming.

2. Update, update, update

Old content is a really easy way to lose a potential customer through your funeral home website. Set aside time regularly to review and update content as needed. Delete old content, add new or rotate customer reviews, and make sure images and videos look fresh.

3. Make sure it’s easy to contact your funeral home        

How to contact someone in your funeral business should be the easiest thing to find on your website and should exist in more than one place.

4. Your ‘About Us’ page goes a long way

Invest time on your ‘About Us’ page. The funeral profession is one that thrives on comfort and trust. Helping people feel like they know you and your values can definitely lead to a new customer.

5. Be mindful of when your website needs an upgrade

The web is a constantly evolving creature. There is always something new or a feature your website could benefit from that wasn’t available when you created the site. Things like search functionality, SEO, and being in ADA compliance, should always be on your website maintenance and upgrades list.

Trusted Johnson Consulting Group partner, Funeral Results Marketing (FRM), can help with all the above and more when it comes to your website. FRM is a digital marketing company dedicated solely to the funeral profession, specializing in marketing websites and tools for funeral homes, cremation businesses, cemeteries, and pet cremation businesses.  

The post How a Funeral Home Website Can Be The Introduction You Need appeared first on Johnson Consulting Group.

Scottsdale, Arizona – The Memorial Classic’s annual golf event brought in a total of $210,000 in donations for the 2022 year. This number officially brought their grand total of donations to over one million dollars of giving back to the funeral profession over the past 40 years.

The Memorial Classic took place April 24th- 26th in Las Vegas, Nevada. Each year the profession’s finest fly out from across the country to participate in this two day golf event. This year’s event had 107 participants. It’s organized by Tom Johnson, Jake Johnson, Kim Price, Bill Cutter, and the JCG team in efforts to give back to educating the next generation of funeral service.

The donations from this event go directly to the Funeral Service Foundation’s Academic Scholarships as well as ICCFA’s Funeral Trust Foundation. These donations serve to provide educational opportunities, scholarships, supplies and more for those entering or furthering their education in funeral service.

Jim Price, Chairman of the ICCFA Educational Foundation stated, “We are very grateful for all of the support The Memorial Classic provides us. Without it, we would not be able to make education accessible to our profession’s future leaders.”

“The Funeral Service Foundation is grateful for the continued generosity of Johnson Consulting Group, Tom Johnson, Jake Johnson, and all those who support the Foundation via Memorial Classic,” said Foundation Executive Director Lee Wiensch, CAE, CFRE. “Our Memorial Classic Academic Scholarship winners regularly say, ‘Thank you for believing in me.’ We know they will be professional trailblazers, just like those who are remembered each year at the Memorial Classic.”

Tom Johnson, Founder of Johnson Consulting Group, started this event 40 years ago to get friends from the profession together for a few days over golf. Now it’s one of the most successful fundraising events in the profession year after year.

“It’s great to see how a group of people passionate about the future of the profession can make a difference,” says Tom, “We are always grateful for the attendees and their generosity.”

Jake Johnson, CEO of Johnson Consulting Group, has watched this event grow from day one into something everyone looks forward to each year.

“It’s a huge milestone for the event to reach one million dollars in donations,” says Jake, “I am proud of everyone involved who has made this happen year after year.”

About the Funeral Service Foundation – FuneralServiceFoundation.org

Since 1945, the Funeral Service Foundation has served as the profession’s philanthropic voice. As the charitable arm of the National Funeral Directors Association since 1997, the Foundation receives operational support from NFDA and donors across the profession to help advance its mission to support funeral service in building meaningful relationships with the families and the communities it serves.

About the ICCFA Educational Foundation

The ICCFA Educational Foundation, founded in 2005, seeks to make education accessible to the future leaders of the deathcare profession. It does this by awarding scholarships to the educational programs of the International Cemetery, Cremation and Funeral Association, as well as advancing initiatives designed to promote the profession and support the individuals who answer the call of service. The ICCFA Educational Foundation is a tax-exempt 501(c)(3) charity.

About Johnson Consulting Group

Johnson Consulting Group is committed to providing intelligent business solutions that address succession, operational, financial, and customer service needs within funeral homes and cemeteries. JCG has been creating personalized partnerships and growing revenue with funeral and cemetery business owners, managers, and staff for over two decades with solutions including succession planning services, financial management & accounting services, and professional cemetery & funeral home consulting.  For more information, visit www.johnsonconsulting.com to learn more.

The post The Memorial Classic Reaches One Million Dollars in All-Time Donations After 2022’s Event appeared first on Johnson Consulting Group.

For a marketing plan to work, you first need to identify goals, set a strategy, and know what data markers to track along the way so you know what to do more of.

Sound like a lot of work? Can be. The good news is there are a lot of marketing tools and software that can help make your marketing easier and more efficient. More on that at the end of this post. First, let’s get a handle on goals and strategy.

Ready, set….GOAL

Marketing without set goals is like driving somewhere new without directions. You might get there in the end but there’s a good chance you’re not going to take the best route, it’s going to take you longer, and you probably won’t know how to repeat the trip. Setting clear goals for each marketing decision makes it easier to evaluate what’s working.

Some common marketing goals are:

• Get your name out: Let new families in the community know who you are.
• Increase engagement: Nurture relationships with your current families and social media followers by interacting with them.
• Make something happen: Determine what action you want people to take. Some examples are getting them to call you, subscribe to a newsletter, or click on your website.
• Find new families: Track and evaluate the interactions of a person with your brand to determine whether they’re likely to be interested in your services

Once you’ve got a goal set, create a strategy to support it. One marketing strategy, that works well in the funeral profession, centers around content. This is sometimes called content marketing. With this strategy, you provide useful information to your community, and that information helps builds a relationship with individuals who see it, read it, and interact with it.

It’s important to write content that interests your community and aligns with your goal. A “Get your name out” pieces of content might focus on donations you’ve made, service opportunities your firm participates in or something relatable celebrating your staff. Whereas “Make something happen” content might focus on the importance of preplanning and how to get started.

Try to think of topics that would be useful, relatable, or thought provoking to them. Here’s a few topic ideas to help you out.

• Honoring veterans and first responders
• Grief and healing
• Holidays
• End-of-life planning
• Cremation services
• Staff tributes
• Updates to your facility
• Steps to take after a death

Pro tip: Include a picture or video along with your writing. Imagery and video improve engagement. Being Photos and videos relevant to your community, your funeral home, and your staff tend to get the most clicks.

Make friends with your data

It begs to be repeated; data should inform your marketing decisions. Data can tell you whether or not you are reaching your families, what needs improvement, and how to reach people better in the future. Here’s 3 examples of marketing data that you can use for your funeral home’s marketing.

Social media engagement

Most funeral homes have a Facebook account. Facebook includes a wealth of data about post and ad campaign performance.

Some key data points to track include:

• Social reach – The number of people who saw your post or ad. Watch this over time and see what type of posts get the best reaction.
• Social engagement – How many people interacted with your post, page, or ad. Interactions will vary based on the size of your community, the age of your community, etc. But compare engagement among your posts and ads and stick with what gets the best engagement.
• Contacts collected – If you run Facebook ads (and you should!), contacts collected are the number of people who gave you their contact information. Track which posts or ad campaigns collected the most contacts.
• Cost per lead – How much each new contact costs you. At Funeral innovations we’ve seen leads cost between $4-13. If you are over that number (or even running on the high side) turn your ad off and try a different topic, audience, or fresh content.

Email open rate

Writing takes time. And you want to be sure people are reading what you send out. That’s why you need to track email open rates. At Funeral Innovations, we regularly see open rates around 25% among all our clients for newsletters. Nurturing emails on specific topics people requested rank higher, closer to 50%. Strive for this. If you’re not hitting the mark, try new content and a new subject line.

Often a catchy subject line is the biggest driver to a good open rate. Some useful tricks include starting with an action verb, personalizing the subject line with the name of who you’re emailing, and keeping it short and concise. This will help increase the number of families who actively open and read your emails.

Website Interactions

All roads lead to Rome, or in your case, to your website. It’s more than likely that your families will visit your website – not just once – but multiple times before they decide on your funeral home. That means each of these visits gives you data on their interactions with your content there. Use this data to improve your website.

Here are some to watch below:

• Organic Traffic – The number of visitors to your website from unpaid sources, like a Google search. These people have shown intent to find your business without clicking on an ad.
• Bounce rate – This means how many people are clicking on your website and leaving immediately. If your bounce rate is high, consider taking a look at your design, loading speed and whether your content matches what families are looking for.
• Conversion rate – This Is the percentage of visitors that complete a desired action. Common activities to track are newsletter signups, forms filled out, and product purchases.
• Contacts collected – Just like on Facebook, you can also measure the number people who gave you their contact information through your website. Track what pages and forms are collecting the most.

What is marketing automation and what does it do

The funeral industry is a busy one and most funeral directors don’t have spare time to mess around with their marketing. Tools like marketing automation software can save you a whole lot of time. 

As the name suggests, marketing automation software sends and tracks your marketing content for you. That way you have one place to log into and check on your email campaigns, social media posts, newsletters etc. Plus, marketing automation software can show you data across social, email, and even your website so you get all the data you need in one place.

There are many other handy tools marketing automation software offers including pre-made content galleries, content calendars with prescheduled posts, automatic text or email responses, and marketing data analytics.

These tools can be used to:

• Schedule content like social media posts to automatically run on a set date and time
• Track families and their interactions with your social media, website and ads to determine their interest in your funeral home.
• View data on your current marketing to see how it is performing

In the end…

Make sure you’re reaching your families and that you’re doing it right. Having clear, concise goals will help you develop a strategy and content that is both useful and relatable to your audience. Remember that you don’t have to do it all by yourself and that getting the right tools, like marketing automation, will make your marketing stress-free.

Growth Engine

Growth Engine by Funeral Innovations is a marketing automation software made specifically for the funeral industry to assist funeral directors in growing their marketing and therefore growing their business.

Talk content here: creating content, where to get ideas [GU1]

The post Not Seeing Results with Your Marketing? Here’s How to Get Back on Track appeared first on Johnson Consulting Group.

Selling doesn’t have to be spooky

Thinking about your business exit strategy can feel like you’re walking in darkness without knowing what’s lurking around the next corner. Planning to sell your business doesn’t have to be so scary! Selling is just a part of the business cycle, and a little knowledge can go a long way in helping your feel safe when it comes to the unknown. With the right tools and expert guidance, there is plenty of light to brighten the pathway to your future.

Get going on your succession plan

When it comes to succession planning, the earlier the better. Putting together a proper timeline and a solid plan is the first step to a better future for you and your business. It can take time to thoroughly evaluate prospective successors to discover who is best suited to lead the business you have worked years to build. Assessing their aspirations and goals, as well as considering how well they will interact with future colleagues, clients, and partners can be a lengthy process, but it is well worth the wait to know your legacy will live on.

Time for an accurate valuation

There is no need to sell your business for less than it’s worth, which starts with an accurate valuation performed by a professional well-versed in the funeral home and cemetery services business. JCG’s experts have you covered. Even if you intend to sell to a friend or family member, properly assessing your business’s value is essential when it comes to market value distribution and transfer tax regulations. Your business’s cash flow, risks, and potential growth need to be assessed in order to give your potential buyers a realistic idea of profitability (and may even boost your profitability prior to sale). Knowing your business’s value allows you to exit with confidence.

Don’t settle for less than your hard work deserves

You want to feel good about your sale financially, but you also want to feel good about it on a more personal level. Once you know what your business is worth, use that knowledge and certainty to find and train the right successor. Don’t settle for less when it comes to money or the right leadership. This will take some time and effort, but curating a proper transition that takes your funeral home’s needs and goals into account is so important. Going this extra mile will leave you feeling confident not only about your exit but also about your enduring legacy.

Understand the tax implications of selling

A large part of financial assurance is having a comprehensive understanding of your business sale’s tax implications. Tax laws are complicated and ever-changing, so enlisting professionals who know the funeral home and cemetery business is especially essential at this stage of your selling preparation. Having outdated information or miscalculating an assumption can quickly lead to decreased profitability and even sabotage your sale. Know exactly what tax ramifications are on your selling horizon so that there are no chilling financial surprises in your future.

Ask the experts!

Regardless of whether you’re business sale is a decade away or creeping up quickly, it is time to bring in the professionals to help you put yourself in the best possible selling position. Be bold when it comes to your succession planning and your financial future, but don’t go it alone. Johnson Consulting Group is your partner in planning and is here to keep you safe and sound through all phases of the business cycle. Planning your exit strategy the right way and with the right professionals by your side can ensure your future isn’t haunted by bad decisions for years to come.

Plan With JCG

The post 5 Ways to Plan a Fearless Exit Strategy appeared first on Johnson Consulting Group.

• Business valuation
• Succession plans
• Business sale timing
• Qualities desired in a buyer
• Business acquisitions
• General goals

By compiling and analyzing the results of the survey, Johnson Consulting Group was able to paint a picture of the current industry mindset as well as predict the next stage. The results were mixed but went a long way in revealing the hopes, fears, and plans (or lack thereof) of funeral services professionals.

Winds of change

One thing in particular was obvious when examining the survey results — we’re seeing shifts in thinking across the board. As funeral rituals evolve and the market shrinks with the significantly smaller Gen X reaching middle age and beyond, concern about the next steps for the funeral services business grows. Change is no doubt inevitable, but how do you change with it in order to stay relevant and successful? If you are ready to move in another direction, how and when should you bow out of the funeral services profession gracefully?

Combing through the data brought many other questions to the surface as well:

• What does it mean to sell?
• What is a succession plan?
• How can funeral service professionals ask families to plan when they don’t have a plan for their business?
• If you aren’t thinking of selling, is your business house at least in order financially and otherwise?
• If you know the current value of your business, do you also know the 5-10 year valuation forecast for it?
• What defines a trusted buyer and how do you find one?

Takeaways for an unsettled industry

Funeral services and cemetery professionals are looking for answers when it comes to the future of both your individual businesses and your profession as a whole. You have a need for knowledge in a variety of areas affecting your livelihood. After aggregating survey results and considering the additional questions that emerged from looking at those survey results, five main takeaways were formulated. These takeaways can also be defined as main need areas:

1. Knowing what it means to sell
2. Determining value and the best time to sell
3. Designing a succession plan
4. Detailing the terms of sale
5. Finding a trusted buyer

From insights to solutions

When thinking and variables shift, actions need to shift with them. Harvesting the main takeaways from the survey results allows us to establish some key insights and then create solutions. Johnson Consulting Groups has answers to the funeral services profession’s burning questions and is eager to share its expertise.

Issue #1: Knowing what it means to sell

Solution #1: Clear, comprehensive summary of selling from low-key family transition to active marketplace sale

Issue #2: Determining value and the best time to sell

Solution #2: Guidance on who to trust when it comes to valuing your business and timing your sale

Issue #3: Designing a succession plan

Solution #3: Professional succession planning specific to funeral services and cemetery professionals

Issue #4: Detailing the terms of sale

Solution #4: In-depth outline of sale terms to help you realize your business’s true value and avoid surprises

Issue #5: Finding a trusted buyer

Solution #5: Proven advice on where to look and what to look for when searching for your perfect buyer

Just the beginning 

Johnson Consulting Services isn’t about surface solutions; we take knowledge gained and go in-depth to discover solid, long-term answers. Ready to dive deeper into creating your best future? Be one of the first to benefit from funeral services and cemetery business trend predictions when you sign up to receive Johnson Consulting Group’s long-form report — The Future of the Funeral Services Business: Analysis and Answers.

The post A survey for the future appeared first on Johnson Consulting Group.

-Jay Abraham

What many people don’t realize is that their preneed trust account may be full of data that can be used to help build, define and guide current business strategies. If you take your preneed trust data and analyze and review it on a regular and ongoing basis, your preneed business is more likely to be viewed as a future asset rather than a future liability.  Data can help you evaluate your business performance, analyze your business profitability, help you make decisions regarding investments, and provide guidance for the future.

In ClearPoint’s role as a preneed trustee and record keeper, it has become apparent that the data within a preneed trust account can be used in many ways, which are easily broken into two categories: Sales Guidelines built using your data, and Current Comparison Tools for your existing preneed trust.

Building Sales Guidelines

As with many other facets of life, when talking about preneed trust and the underlying data, it is often best to start at the beginning, or at contract set up and assumptions. You will want to consider the following items/terms when you are setting up your preneed trust program in order to increase the likelihood of a successful program:

• Setting a Preneed Objective
• Payment terms
• Finance charges

Setting a Preneed Objective. While setting an objective sounds both simple and obvious, it is not how all preneed programs start out.  Many people make the decision to sell preneed trust because a family walked in the door and requested to preplan.  While this is certainly a place to start, the most successful programs that significantly drive business growth have a specific and defined customer and objective.  For example, is it your intention to only sell walk-in preneed business, and therefore you wouldn’t want to invest in a lot of marketing for growth? Or is it your objective to provide the least expensive option and out-price your competitors? Perhaps it is your objective to sell to primarily younger beneficiaries, but also to sell higher priced contracts because of the services you plan to offer?

Whatever the case may be, it is essential to set your objective up front, and, once you have an established preneed business, to regularly check in to confirm that you are still “on track” with that objective. You can use your average contract size, the amount of monthly new writing, or the average age of your beneficiaries to confirm your adherence to your stated objective.

Payment Terms. The average preplanned funeral or cemetery contract placed into trust will remain there for 7-11 years.[i] This is important to take into consideration when working with a family that wants to make payments on a contract over the next 10 years.  If payments are being made over a longer period of time, there will be less time for the funds to be invested and grow to combat inflation. Over the years, we have found that it is best to not extend payment terms out further than 5 years, at the most, if trying to grow the funds through investments.

Finance Charges.  How often are you allowed to buy something and make payments over time and pay no interest? When that does happen, aren’t there usually terms stating you will have to start paying interest, such as missed payments? If other sellers aren’t waiving interest for nothing in return, does that make sense for your business? Many states allow finance charges on contracts where payments are being made over time.

Often times, a counselor will offer a trust product to a family wishing to make payments over time rather than an insurance product.  Since a trust product doesn’t lapse, this is often an attractive option for the family.  However, it means that the burden of risk has been shifted from the family to your location by allowing payments over time.  Finance charges are often used to alleviate some of that risk and ensure that families pay off or cancel their contracts in the time allotted. If your preneed business includes many families who wish to pay over an extended period of time, it makes sense to consider implementing finance charges.

Current Comparison Tools

The data associated with your preneed trust contracts can be very telling, but often overlooked.  For example, when you’ve outsourced your preneed record keeping to a record keeping company, you may be able to turn to that company to get an idea of how your business compares to other industry standards. For example, if that record keeper has a number of customers similarly situated to you, they may be able to tell you how your preneed contract values compare to the data averages they have.

In addition to looking at your averages compared to others, it is important to use the contract data to compare the changes in your business year over year.  Are your average contract values growing? Declining? Is that what you would expect to see based on what you know about your business?

A final essential piece of your preneed data that you will want to evaluate focuses on the age of your preneed contract beneficiaries.  This in particular is an important data point, as it can be used to ensure that you have properly invested your preneed trust funds. Knowing the age breakdown of your preneed beneficiaries can be a driving force in your investment policy.  If the majority of your trust contracts are written for people ages 85 and up, you may have a shorter term investment horizon, and therefore want to invest more conservatively.  If the majority of the contracts you have written are age 65 or younger, you can invest more aggressively.

Critically evaluating the data that is already available to you when it comes to your preneed trust account can be the difference between a successful preneed program that supports the long term growth of your business versus one that produces negative results.

Conclusion

As mentioned in the beginning, you can certainly look at a preneed block of business to indicate and get some idea of the future health of your funeral business, but this cannot be taken on its face alone.  It is important to understand the data behind the numbers and use that data to your advantage.  We’ve walked through how to use data to set up and continue your preneed program through objective setting, payment terms, and finance charges, detailing how each of these items can significantly impact the success of a preplanned and guaranteed contract when it turns at-need.  We have also given information on how to analyze the data in an existing program to help evaluate your business growth and invest the preneed funds for future growth.  Even with these topics, we have only scratched the surface on the different facets of your business that you may want to consider when setting up and running your preneed program.  It is essential that you keep an active approach to your preneed program if you want to continue to see your funeral business thrive for years to come.

[i] Time frame based on contract data available in ClearPoint proprietary record keeping system.

The post Leveraging Your Trust: Data Is Power appeared first on Johnson Consulting Group.

As a successful funeral home director, it might be tempting to coast along, assuming that past years’ successes are sure to continue; however, failing to create and implement a strategic plan leaves you vulnerable to straying off course. 

As John Lennon once sang, “How can I go forward when I don’t know which way I’m facing?” A strategic plan will not only let you know where to turn your attention but also how to continually refine your practice moving forward.

A Strategic Plan in the Funeral Profession

To put it more concretely, a strategic plan involves the owners and senior management teams at your company. Together, you will assess current performance, analyze the market, set goals, plan your actions, and identify how to achieve said actions. 

Preparations

Before you begin crafting your strategic plan for your funeral home, you’ll want to ask yourself:

• How is the business performing? 
• How do we continue to improve our services? 
• What changes are currently shaping the industry?
• Is employee morale positive? 
• Are we as profitable as we could be?

Naturally, not every question will offer a fruitful direction to pursue; however, it’s important to consider each of these areas. As you mull on these questions, you’ll want to pull in numbers when appropriate. While it’s easy to feel as though your business is performing optimally, actual revenue totals provide you with tangible support (or refutation). 

Another important source to examine is customer reviews, both from internal feedback and public reviews posted online. While you’ll likely find one or more glibly negative reviews on Google, it’s important to search for the grains of truth in here. While it’s tempting to fixate on the areas of weakness, it’s important to pay mind to the strengths identified in reviews, as these can become pillars of your business.

Remember, you won’t be doing this planning alone. Create a list of each area of your business and identify the key stakeholders in these areas. You’ll want to make sure these stakeholders are present at your planning meeting, as they’ll provide you with a better on-the-ground understanding of the different facets of your business. 

Steps of Strategic Planning 

Since the process of strategic planning should never be rushed, set aside an entire day to meet with your team. 

Once you’ve assembled your team, consider the following steps:

• Create an Objective: To start off, brainstorm a list of objectives with your team. This will give you an overview of your business’s potential. It will also signal what your teammates would like to see from your company.

• Company Review: Take a look at your current year. How is your business doing? What are the key successes and failures of the year, and what contributed to these outcomes?

• Conduct a SWOT Analysis: Take stock of your company’s strengths, weaknesses, opportunities, and threats. Strengths and weaknesses are pretty straightforward, so pay close attention to the opportunities (ex: a rise of interest in virtual ceremonies) and threats (ex: a new funeral parlor opening in town).

• Set Goals: Based on all of your observations and team input, you’ll want to set tangible goals to achieve, both in the immediate and long-term future. 

• Give Ownership to the Team: Figure out which actionable tasks and duties can be assigned to individuals on your team. In future meetings, they’ll be reporting back to you on these duties.

Tips from the Experts

If you’re at a loss as to how to improve your business, then you might want to consider consulting with outside experts. Johnson Consulting Group has been in the profession for decades and has worked with funeral homes throughout the U.S.

Here are our additional tips when it comes to strategic planning:

• Meet Offsite: By meeting outside of the workplace and providing meals, you’ll create a more relaxed atmosphere, one in which your team will feel more comfortable expressing their honest thoughts on the company’s performance.

• Encourage Written SWOT Analysis: It’s imperative that the input from your team is honest. To ensure this, you should instruct your team to write down a SWOT analysis and bring it to the meeting. This way, you could anonymously read people’s thoughts, ensuring each person’s findings are heard. 

• Clearly Define Ultimate Goals: If everyone at the company knows what the long-term goals are, then they can better steer your company in this direction.

• Schedule Regular Check-Ins: As with any aspect of life, not everything goes according to plan. By scheduling check-in meetings, both as a group and individually with team leaders, you can keep track of any unexpected changes or setbacks and adapt accordingly.

• Measure Everything: A worthwhile goal is nothing without a way to measure it. Be sure that you establish metrics of success for each goal (ex: positive reviews, number of conversions, dollar amounts, etc.) and that you’re tracking accordingly.

Why You Need a Plan

If your funeral business doesn’t have clearly stated goals, then it’s impossible to determine how well you’re doing. Creating a strategic plan is about preventing your business from stalling out, spurring continuous growth and evolution, providing a higher degree of service to your families.

If all of this seems difficult then consider consulting the experts at Johnson Consulting Group. Through our years of experience with helping funeral businesses, we can help you identify any existing pain points and provide the appropriate guidance for the ongoing success of your funeral home. 

Ensure Your Future

The post What is a Strategic Plan and Why Do I Need One? appeared first on Johnson Consulting Group.

Sunny business prospects may soon turn cloudy. Just when things were looking bright for funeral home and cemetery sales, the tax people have started closing in. Darker days are on the way in the form of increased capital gains and ordinary income taxes. Now is the time to consider selling.

Tax Fact #1 – The Proposal

A proposed federal tax increase could soon affect your business by raising taxes on long-term capital gains and qualified dividends, as well as ordinary income. If put into effect, the U.S. would have the highest marginal tax rate in the OECD (Organisation for Economic Co-operation and Development) at 39.6% (currently 20%). When combined with the 3.8% NIIT (Net Investment Income Tax) and average top state capital gains tax rates, the proposal would lead to a top combined state and federal tax rate of 48.4%, up from the current top rate of 29%. At this number, the U.S. would have the highest overall tax rate in the OECD.

Tax Fact #2 – The Timing

Things are already starting to look gray and the cold chill of the new tax proposal could be approved and take effect on January 1, 2022, if not sooner. This means time is of the essence to get a succession plan in order and possibly even push up your selling timeframe in order to avoid lofty new taxation on your business and personal income.

Tax Fact #3 – The Details

The new tax proposal:

• Would apply to taxpayers with taxable income over $1 million
• Is not expected to be retroactive
• Would put the U.S. in a small, elite group of only five countries facing capital gains and dividend tax rates above 40% along. The other countries are Denmark, Chile, Ireland, and Korea. 
• Is part of a broader plan to raise taxes on those making over $400,000

Tax Fact #4 – The Consequences

Because funeral home and cemetery businesses tend to stay around much longer than others, sometimes even 100 years or more, capital gains can be significant. This potentially puts funeral home and cemetery professionals at greater tax risk than others. Unlike other businesses, funeral homes and cemeteries almost always include real estate, which most often results in building depreciation. This building depreciation many times creates a net income tax benefit over the years, but the benefit is then eroded at the time of sale due to a depreciation recapture tax. The depreciation recapture is taxed at the ordinary income tax rate up to a certain threshold percentage, which could mean well over $500K-$1M in additional taxes under the proposed tax structure changes. Ordinary income taxes may have an even greater impact than capital gains taxes, so all angles need to be considered. 

Tax Fact #5 – The Exit Strategy

The first leaves are already falling, so the time to act is now. Get your share of the current selling boom before it’s silenced by new tax laws. If you do not yet have a succession plan, need to update your succession plan, or need to push up your selling timeline, we are here to talk. Johnson Consulting Group has the knowledge to help you understand what’s coming next and the experience to lead you forward. We are in business to assist you in getting the most out of your business.

Contact JCG Today

The post Five Things You Need To Know About Taxes Right Now appeared first on Johnson Consulting Group.

Did you know that 75% of business owners regret exiting their business? And it’s not all about the money. In addition to financial concerns, we often see funeral homeowners regret issues related to timing, their employees, and their greater sense of purpose. Luckily, all of these regrets can be avoided with a bit of proper planning.

1. Settling 

When you’re selling a funeral home business, you’re going to receive offers, and much like a flea market or yard sale, you’ll undoubtedly receive lowballed offers. The key to choosing the right deal, however, is knowing which deals to consider and which to say no to.

Often, funeral directors see the sale of their business as a means to an end, quickly accepting the highest offer available; however, this overlooks your needs in the transaction. Before selling, you should ask yourself what you’d like to accomplish with the sale. 

• What are your goals? 
• Do you wish to keep majority/minority control? 
• Are there personal financial goals you’d like to achieve? 
• Do you plan to engage in the new owner’s education regarding your business? 

It’s really about chickening out. Your funeral business does not have a set value; rather, it’s worth whatever someone is willing to pay for it. Taking time to assess this worth, free of the pressure to pull the trigger, will help prevent you from looking back post-sale and feeling as though you could have done better. 

2. Treatment of Employees

Whereas the sale of national corporations often comes with little changes to the people they employ––apart from shifting change in command––small businesses like funeral parlors often feel greater loyalty to their employees. Especially for hands-on funeral directors, their employees become something of a second family, from the bookkeepers to custodial staff.

Therefore, selling a funeral business comes with the difficulty of letting go of people you once cared for so deeply. While a new owner will likely keep around most, if not all, of your existing staff, there’s no way to guarantee this. 

One of the best ways to ensure that your employees are taken care of post-sale is to provide the new owner with organizational charts, job descriptions, and detailed reviews of all current workers. Often, a new buyer is immediately interested in cutting operating costs, which could mean slashing salaries or letting go of some workers altogether. By imparting the importance of each person’s role to a new owner, you increase the likelihood that their employment will carry on similarly.  

3. Leaving Money on the Table

If money is a core motivator to selling your funeral home, then it’s important to really look at your finances and the potential for more revenue in the future. Ask yourself if now is the best time to sell or is there more business to earn that will also boost revenue and make your funeral home more appealing to buyers. 

One metric to consider is the health of the economy overall. If the stock market and real estate market are doing well––particularly local markets––then you’re likely to get a better deal. If, however, the current state of affairs is similar to that of the 2008 recession, then it might be best to hold out if you can. 

You’ll also want to consider your year-over-year numbers. If your profits have been continuing to climb, then it might behoove you to hold off on the sale. Many funeral business owners report selling their business at a low point only to find that in subsequent years its earnings and value continue to increase. 

4. Losing a Sense of Purpose 

When selling your funeral business, we cannot stress enough the finality of this deal, not only regarding your money and employees but also your future plans. Think long and hard about whether or not you’ll be happy without the connection you had to your business. Again, you should reconsider your motives for selling. Are you planning to retire, or do you just need a vacation? Do you have a plan beyond cashing out?

If you started your business from the ground up or––as is often the case in the funeral industry––a parent passed it down to you, then you likely hold a special attachment to your funeral home. Not only was it your workplace, but it was also like a child, one you raised for the better part of your life. Think carefully about how it would feel to let go of this child. 

After selling their funeral business, many people report losing a sense of purpose. As the owner, you’re likely putting in more than forty hours per week into your business, and while this might sometimes feel stressful, many are surprised at the malaise that sets in. 

The key to addressing this is to plan. Whether you wish to start a new business, move to Mexico with your spouse, or focus on your golf game, it’s important to direct the passion once reserved for your business into a new outlet. Otherwise, you risk enduring a sense of drifting.  

5. Neglecting Taxes 

As with any large transfer of money, the importance of accounting for taxes cannot be overstated when it comes to selling your business. Business sales are taxed based on your capital gain, meaning the rate will match what you pay on your ordinary income taxes. Not considering what this looks like is a major mistake. 

This is where a skilled accountant can come in handy. The accounting team at Johnson Consulting Group not only knows the ins and outs of tax law, but they also have a deep understanding of the funeral profession. Seeking their counsel can help you save money and ensure that you’re abiding by local and national tax codes.

6. Not Talking to Experts

All of this is to say that selling a business is not a decision to take lightly. While the prospect of netting yourself hundreds of thousands of dollars––if not more––is exciting, selling your funeral business takes some careful consideration of your goals, your finances, your people, and your post-sale lifestyle. 

At Johnson Consulting Group, we have a team of experienced business brokers with skill sets related to finances, accounting, and the process of acquisition. We work specifically within the funeral profession and have closed over $2 billion in transactions for other sellers, like you. 

If you’re interested in selling your funeral business now or in the future, we can help you plan your arrangements to ensure you’re happy with your ultimate decision.

MAKE THE RIGHT DECISION

The post Top 6 Regrets Funeral Directors Had After They Sold Their Funeral Home appeared first on Johnson Consulting Group.

Luckily, the issues that arise can be dealt with through proper planning. Let’s take a closer look at some of the more common issues.

1. Poor Market Conditions

Above all else, your decision to sell your funeral business should hinge on the state of the market. Much like real estate, the market for funeral homes is subject to fluctuation, and you’ll want to be sure your business is primed to garner a maximum return in a seller’s market.

To spot poor market conditions, you should look for the following:

• High interest rates: The more debt buyers have to take on, the less they’ll be willing to pay to purchase your funeral home.
• Low number of buyers: If there aren’t many people out there looking to purchase funeral businesses, then the market is likely in a slowdown, and offers will be lower.
• Periods of decreased revenue: If your business has experienced a year of lower revenue or slowed growth, then it will appraise for less than it otherwise might. This was particularly common for funeral businesses in the wake of Covid-19.

How to Combat It 

The key to dealing with poor market conditions (if waiting isn’t an option) is to make yourself look like the best option out there. The market will eventually hit an upswing, and you’ll want to position your business for success when this occurs. 

To accomplish this, you’ll want to make sure your funeral home is in tip-top shape, making it more enticing to a potential buyer. Consider the following:

• Soliciting positive reviews: If your business maintains its good reputation, then more buyers will likely have interest, especially when the market picks back up.

• Cultivating a happy team: As with most human-facing businesses, funeral homes are majorly defined by their personnel. As soon as it’s reasonably possible, communicate your intent to sell the business, and assure them that the business will continue to function.

• Review your financial statements: Having detailed financial statements is essential when selling a business. Be sure to organize your accounting records, particularly the profit and loss, balance sheet, and cash flow statements.

2. Low Valuation

Getting a low valuation can feel devastating especially if it’s much less than expected. Not only can it affect your appeal to potential buyers, but it also likely means you won’t get as much as you want from the sale. 

Valuing your business either too high or low can be a costly mistake, so it’s important to make sure you trust the results you find. Additionally, if the assessed value of your business is low, you may wish to change course, increasing your value before initiating a sale.

How to Combat It

In most cases, buyers will want to see three years of financial accounts and asset/liability records. Additionally, you’ll want to be able to furnish legal records, real estate documents, call volume reports, vendor and partner agreements, and a current list of employees and their compensation. 

Instead of ordering a private or independent appraisal, you could also consider estimating the amount of debt that a potential buyer can realistically pay for. By calculating an estimate of affordable debt on the buyer’s part, you can value your funeral home based on the buyer’s means. 

Another helpful strategy is to present the buyer with a list of owner-related expenses such as salaries, pensions, life insurance policies, and any other expenses that won’t be inherited by the buyer. This will provide additional context surrounding how much they’ll actually spend to operate your business.

3. Unorganized Accounting

Critical to your valuation and any subsequent sale is the story told by your records. Mainly, a buyer will wonder if you’ve been profitable and if there’s room to grow once he or she takes control of your business.

Unless your records are properly organized, it’s nearly impossible to put a value on your funeral business. Sure, you might have tax returns that demonstrate year-over-year profits, but if you don’t present detailed documents that explain how your revenue compares to operating costs, then a potential buyer has no proof of your business’s profitability.

How to Combat It

The best way to ensure organized accounting is to work with an accountant who understands the funeral profession and its idiosyncrasies. Not only can a funeral-specific accountant help you in the planning stages to ensure maximum profitability, but they can also be a key player when you’re selling your funeral business.

Financially speaking, a well-managed business will likely sell for more when the time comes, and an accountant with death care experience––like those from Johnson Consulting Group––will help you through every step of the process, from valuation to sale.

Sell with Ease 

When looking to sell your funeral business, your best bet is to start early, organize your finances, get a professional valuation, and communicate with your team. To be sure you’re covering all of your bases, it’s best to seek some outside help. 

With over $2 billion in closed transactions, Johnson Consulting Group is uniquely positioned to help you sell your business. Their funeral brokerage team can help guide you through every step of the process––from the valuation and finding a potential buyer to securing and facilitating the loan process. 

While selling a business of any size is a complex process, Johnson Consulting Group has the experience and team to help make it seamless and profitable for you.

Learn Next Steps

The post The Top 3 Challenges of Selling Your Funeral/Cemetery Business and How You Can Easily Combat Them appeared first on Johnson Consulting Group.