Being staid and traditional has helped funeral homes in this area that have been in the same family for generations to develop solid reputations. The Center cannot compete on the basis of being just another staid, conservative funeral home. It will succeed by quickly developing a reputation for being unique, offering something that a largest segment of the decision-making market is beginning to demand and that traditional funeral homes are not positioned to provide.
Traditional funeral homes have not been structured to meet the need for social support the living need to move forward and to complete the process of grief by coming to acceptance. The Center will be structured around the need that Baby Boomers are expressing to gather social support and to celebrate life.
The Evergreen Life Memorial Center is the first of a new category of funeral providers in the Anytown area. The Center provides celebration of the individual and social support to bring closure and move ahead with life. It will be the place for the Boomer generation to celebrate life when it ends because it will be more uplifting and social than traditional funeral homes. It will thus live up to its slogan, "People remembering people."
There are three purposes of a funeral:
These three purposes: closure, social support and celebration are the ultimate products of the Evergreen Life Memorial Center. Traditional funeral homes have provided the rituals to bring closure, but have not provided the social support that is needed in modern times for the living to move forward and to complete the process of grief by coming to acceptance. The Center will be structured around the need for people to gather social support.
Traditional funeral homes are somber and morbid places people are afraid to go to. Funeral homes that are staid and conservative will not be preferred by the "Pepsi generation," which laughed at parodies of such homes in the television series The Munsters. The Center will be a place of celebration actively involved in people's lives that people will want to go to.
Because reputation is the key to success of a funeral home, the focus of the Center will be to quickly establish a reputation as the place for celebrating life when it ends in the way baby boomers want to be remembered.
This will be accomplished by hosting nonprofit activities that gather wide publicity. Stan Peters, the owner, will take a leading position in forming a local chapter of an organization like the Make-A-Wish Foundation, which makes dreams come true for children with terminal illnesses. The death of a child is the hardest thing for nearly anyone to take, including funeral directors. The recreation and meeting rooms of the Center will be available for the free use of nonprofit organizations that the owner is personally excited about. A public relations firm will be used to orchestrate the maximum exposure for the Center, its activities and the charities it promotes. This will bring the Center into the life of the community and give it a reputation for caring and for celebrating life.
The choice of location will support this focus. The Center will be sited within the metropolitan area where over two-thirds of the Lane County population lives. The ideal location would be the purchase of a church with a chapel and recreation room, with a stand of Ponderosa pine or Douglas fir in the front and back to bolster its Evergreen brand.
Sales will be accomplished through implementing the sales process and the employment of a full-time sales professional in year three. During the first two years, the sales process will be implemented by the owner who will document procedures and training manuals.
The job of the sales professional will be to:
The sales professional will not be commissioned in order to avoid hard sells, but will be compensated with a base pay that would be considered moderate for salary plus commissions of a good salesperson in this market. In addition, he or she may receive profit sharing based on the overall growth of the business.
Sales forecasts are conservatively based on market share projections and the standard business growth curve.
There were 2,859 deaths in the Anytown MSA (closely equivalent to Lane County) in 2004. About 75 percent of deaths result in funerals nationwide. At the average 2003 price of $5,374, this means the funeral market in Lane County is worth $11,523,200.
Since there are currently 14 funeral homes in Lane County, and there will be 15 when the Center opens, the average market share will be $768,213 in 2003 dollars. The average price of funerals at the Center will be a little higher. We project the average funeral at Evergreen Memorial Center will be $5,884, broken down as follows:
The average market share measured in the number of funerals per year will be 143 funerals a year. Our total sales for the first year are projected at one-fifth of the average market share, or about 29 funerals at our average funeral price of $5,884. Businesses start slowly and, if they capture a niche, will then grow quickly. The sales projections are based on sales of one funeral for each of the first four months, followed by two funerals a month for two months. After that, one additional funeral is added each month for the first year.
For the second year, sales grow to one-third market share with 48 funerals for the year. In year three, it becomes 3/5 of average market share at 86 funerals. In the fourth year, we acquire our full market share and our optimal level of sales with 143 funerals based on our current prices and death statistics. The 12 percent growth shown in FY 2010 merely shows revenues on optimal sales of 143 funerals catching up with inflation from the previous four-year period, assumed at three percent per year.
The Cost of Goods Sold percentage of 35 percent is based on industry averages according to trade literature.
Sales of Immediate Cremations are projected according to market share of Lane County deaths that do not result in funerals (25 percent) multiplied times our average price. Our average price of an immediate cremation is as follows:
In order to secure these goals, the Center will develop publicity that will draw Baby Boomers because of its leadership in nonprofit causes and its unique reception facilities, offering individualized celebration and social support. A public relations firm will be retained to promote the Center. The sales staff will network and become involved in the community to bring in business. Finally, the sales program will effectively capture the business these activities bring in.
The following table lists important program milestones, with dates and managers in charge, and budgets for each. The milestone schedule indicates our emphasis on planning for implementation. The most important programs are nonprofit activities to quickly establish our reputation as part of the community. These efforts were described in detail in previous sections.