Funeral Home Business Plan

EXECUTIVE SUMMARY

Death is an inevitable phenomenon. When one dies, it is inorder that he or she gets a good send off from friends and family members. Ohio, one of the greatest states in America has numerous towns with funeral homes. However, they do not offer an all round service for the disease. Unfortunately, Monroe, one of the towns in Ohio has no funeral home consequently citizens move to other towns, an expensive and time-consuming issue. This plan outlines the strategy by which a new funeral home, Dobrozsi will define and dominate a new perspective of funeral service provision in Monroe town, Ohio State and extend to the whole USA.

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It also focuses on the untapped opportunity in the cremation of the dead bodies. Up to now, very few funerals home are cremating the dead bodies. Change in worshipping has resulted into many people going for cremation instead of burial. The plan outlines how these opportunities will be made use of to increase the business scope and turn over there by increasing the profit margin of the business. It will also bring out how these services will be achieved in both the long and the short time. It explains how it shall use the competitive advantage to ensure that it is on top of the business.

The plan also brings out the mission, vision, and the objectives of the business. It analyzes the mission of the business its vision and goals as well as the organizational culture. The business will be built on the philosophy of ‘divided we fall united we stand” this means that the business can not do a lone minus the other key stakeholders in the sector which include the families, employees, the owners and the environment at large. It describes the culture and what will be done to attain the culture of the business.

On a different perspective, the plan describes the business to be started. It gives a brief summary of the business, the type of the business, which is Limited Liability Company. It clearly defines the shareholder who is the sole owner of the business.

The plan analyzes the opportunity available through research and how the opportunities will be exploited. The plan identifies the very good and many good opportunities, the entities already in the market, how the incoming entity will take a competitive advantage over the other rivals and outwit them. It mentions the available competitors in the market. It goes ahead to discuss the marketing strategy and plan that the business would use. In this chapter, it discuses identification of the customers or consumers of the product will be identified and mechanisms to reach them. Market segmentation is discussed in this chapter with at least four different segments that the business will try to meet in its endeavors to provide the best quality diseases. It identifies the target markets out of these segments and a market strategy to reach to them.

It discuses management and operations of the service business the entity is going to engage in to meet the needs of the customers. The competition in the business has been described vividly together with the different buying patterns experienced in the industry. The plan also identifies the competitive edge and the sales strategy that may be employed to attain the target sales. To conclude, the plan gives a financial breakdown of the required amount for financing the project. It the goes ahead to give a request for funding and the exist strategy. It closes by giving appendix.

MISSION, VISION AND CULTURE

Mission

The mission of the Dobrozsi Funeral Home is to take the best care of the families and friends in the time of a lost loved one by providing the homely environment. The facilities involved will help accommodate the families and friends and the home’s serenity will give much consolation to them.

The funeral home will, through provision of such services grow to be the best funeral home not only in the town but also in the state of Ohio and to the larger USA. It will use these service provisions to be the most profitable home in the environs.

Vision

The vision of the funeral home is to be the first successful funeral home in Monroe with the best service. This will be attained through provision of the highest quality services with well the best facilities in the state, well trained, and experienced personnel at the most affordable rates.

Culture

In order to achieve the set mission and vision, the funeral home will develop a culture of a combination of healthy work environment, hard work, and family and customer service. The healthy work environment will be ensured through provision of better working equipment to the employees with good pay in turn promoting hard work amongst them.

The main concern of the funeral home is to take care of families at the point of bereave thus, they will form part of our culture achievable through provision of better services and more especially customer service.

COMPANY DESCRIPTION

Dobrozsi Funeral Home a comprehensive type or mode of a funeral home with unique services and characteristics form the other funeral homes. It will handle services for all faiths, cremation, and pre-planning on a location of 45050 Monroe at Ohio State found on street 6305 Hamilton along the Lebanon Rd with operations of the business scheduled to begin on February 1, 2011. It is going to be the first funeral home ever in Monroe.

The funeral home will be a limited liability corporation (LLC) and the owner will hold all its shares. Evan Dobrozsi, the owner of the funeral home is known for his well-managed entrepreneurial skills that have helped him start up businesses resulting into changing lives of most citizens. With this motivation, he has decided to start up a funeral home at Monroe. This is will be a funeral home of its kinds though with competition from Middletown, Hamilton, Franklin, and Liberty Township and West Chester area having other different funeral homes.

Making it an exceptional funeral home will be the normal home looking buildings together with different chapels of different sizes. The home looking building will create a home environment for the mourners giving them a sense of hope while the different chapels’ sizes will be due to different service-size demands. Their main intentions are to help in the celebration of a life well lived by the deceased, provide consolation, and hope to friends and relatives through services in the chapels. In addition, it will ensure better customer service to take on board the families as part of the organizational culture.

OPPORTUNITY ANALYSIS AND RESEARCH

State of Ohio has a population of about 11.5 million people being the seventh highest in the USA. The death rate of the USA citizens has been on the increasing note every year according to research conducted of late. In Monroe, the death rate has been significantly increasing with no funeral home around. The closest funeral homes are found in the other towns of the Ohio state, making people to move for long distances taking a lot of time before they get a funeral home.There is no funeral home in Monroe and the death rates are increasing considerably. This means that the cost of sending off a loved one is higher due to the additional costs incurred in transporting the bodies to and from the far funeral homes.

It also leads to too much time wastage between the towns of the state and looking for a funeral home. Time lost is a very valuable resource and once lost can never be recovered. Many people in turn are getting disappointed and demoralized when they, in real sense as supposed to be consoled. Though there are funeral homes around, their services have been limited, slow, and expensive. Staffs in these funeral services lack the experience to offer the best funeral service. What’s more, they concentrate so much on the dead rather than on the people bereaved. There are no measures to console them. In addition, they do not take of other ways of sending off the loved ones such as cremation.

The funeral homes having these facilities are very poor with inadequate number of employees some of whom do not have the skills to offer such services.Research has proved that many citizens are now going out of the state to look for a friendlier funeral home for the services of these loved one lost. Most of these funeral homes in any case, use the non-automated systems making service delivery ineffective. There is push towards cost, as people prefer funeral homes with low costs without compromising on the quality of the service offered. Majoring on these weaknesses of the competitors and the unavailability of the funeral homes in the state, Evan Dobrozsi created an opportunity and is about to venture into serious business.

Dobrozsi funeral home will take up the opportunity by focusing much on the competitors’ weaknesses in order to strengthen them as well as taking the bigger opportunity of the lack of funeral homes in Monroe. In this case, it will enjoy the monopoly status within the region. It will bring services closer to Monroe citizens as compared to the others.

MARKETING STRATEGY AND PLAN

Identification of the customers

In a bid to know the real customers of the funeral home, it is better to segment the market, dividing it in need categories. Most funeral homes if asked today will admit that they do not know their customers. American population is segmented in correspondence with generations making up the population. The funeral will hence concentrate on the generations. Statistics has proven that people age 23 and over are capable of making a purchasing decisions, thus our strategy will be to reach out to people of ages 23 and above.

The funeral home will also target other faith that believes in the cremation of the dead. Most funeral homes have ignored this area for a very long time. Our better, high quality resources will enable us perform the cremation services to the bodies of the deceased who believe in the cremation. The most effective market among the segments id the Generation with a high demand and very little supply hence the funeral home will focus on the market.

Market Segmentation

Monroe has a family percentage of 76% with an average age of 39.7 years old. Our market segmentation will be based on the America’s division of people in terms of ages. We have realized that within these segments, generation as used by USA’s demography, the purchasing power differs and focusing on all of them leading to a variety of market hence needs and services. The market divided according to decision makers on purchasing is has the following segments for focus:

V.2.1 The GI Generation (born 1901-1924 and may be referred to us post World War I) 

According to the USA demographics as at 2003, these are people who are now 76 years and above. In this business, it is the most active with a mortality rate of about 10.9% per annum. Due to this high mortality rate, they have to make funeral arrangements either by themselves for those not afraid or their caretakers will make for them. They in most cases have very little hope in living, more that is a fueling factor for their mortality. The new funeral home will take on this market with a lot of enthusiasm.

V.2.2 The Silent Generation (born 1925-1945)

With a mortality rate of 3.1%, most funeral homes tend to concentrate so much on them. Unexpectedly, the Boomers rather than the G1 have influenced them. Much of their lifestyles revolve mainly on the Boomers trying to much them. A reason that has made many funeral homes to concentrate so much in them is due to other causes of death other than natural attrition. It is considered the working generations with so much experience and many years of service. In effect, they are the richest and help the G1 and the Boomers meet their expectations of funeral services.

V.2.3Boomers (also called the post World War II born 1946 through 1964)  

Compared to the two generations, their mortality rate is quite low about 0.5%. However, the majority of this generation are considered very productive, innovative and more enthusiastic than the above two generations. As a result, they are engaged in planning services and especially for funeral arrangements. For our success, we cannot leave the generation since they will bring business when are attracted to good and high quality services. We win them they bring business.

V.2.4 Generation X (1965-1980) 

Amongst all the cohorts, this is the last and the youngest with a low mortality rate but may experience some changes due to change of behavior. They are so adventurous, a fact that is currently changing their mortality rates. They believe in themselves but are also very influential not necessarily in death but they also participate in the funeral arrangements of their parents and grand parents. Even though they have very little to do with funeral matters, they still influence decisions regarding the funeral arrangements especially if they have no relations in Silent and G1 but boomers.

The Target Market for the home

The target market of the funeral home will be the G1, Silent, and the Baby Boomers. The three cohorts have different needs, tastes, and potential very significant in the operations of the funeral home. Through the three cohorts, the funeral home will learn how to provide differential high quality services to the customers and the families involved. The other target will be the less tapped opportunity in cremation services especially around Monroe. Many funeral homes fear venturing into this type of product and we shall take advantage of this fact to help us have differentiated products to the customers.

Marketing Strategy

Our culture is to enhance the correlation between the employees, the customer and the management, the funeral home focus will to establish a link between the three parties for the success of the business. This will be achieved through provision of high quality services to the consumers at an affordable price, ensure that the employees have the best working environment consequently, high return for the owner.

The chapels will be available for the families of the bereaved to offer service to the deceased and get consolation that he or she has started a new life for the believers.

MANAGEMENT AND OPERATIONS

Having toured the funeral homes and seen the management of the homes below expectations. Dobrozsi funeral home will have the best management of human resources and the services delivered. It is going to gain a competitive advantage through provision of high quality services as compared to the rivals. It strategic management policies will ensure that it achieves the objectives, mission, and vision.

The existing funeral homes are far from the people with low quality services and they have failed to offer-differentiated products to the varied needs and wants of the consumers. It is on this basis that the Dobrozsi funeral home will be managed in order to out do our competitors. From Porte’s five forces that affect the operation of the business, the funeral home shall develop better policies to enhance its effectiveness and avoid any further threats from the incoming entities in the same industry.

Analysis of the service business to be implement

In the event of death, a person has to be buried of cremated depending on the deceased culture and traditions. Since the remains of the deceased are never useful to the family members and relatives there is an option of a funeral home. Funeral homes universally offer some important services to the dead which includes

Provision of a service for then deceased

Ensuring that the body of the deceased is well preserved  and ready for viewing

Moving of the body from the funeral home to residential home and to the burial site

Provision of certain resources to aid the funeral such as casket, urns, remembrance products

Providing immediate burial minus a service depending on the culture an tradition of deceased

Providing cremations service not common to many funeral home

Competition and Buying Patterns in the market

People would choose a funeral home first for convenience purposes, service to the family and reputation derived from the funeral home. The biggest percentage goes for convenience in terms of location and costs. Monroe has not had a funeral home since time immemorial.

Having identified the buying pattern, customers will go for the easiest and fastest option, we are going to launch our funeral home at Monroe to take up this opportunity.

Freedom of worship has also changed the buying pattern. Many people are now joining the religious groups of their choices. Consequently, there has been an increased demand for cremation, an are not well exploited by the funeral homes. People are also becoming too religious. For this reason we are going to have different chapels of different sizes and we shall provide cremation to have competitive advantage not only over the rivals in the market but also for those who may want to join the industry.

Competitive Edge

Dobrozsi Funeral Home is one of the best homes to be started in Monroe. It will provide caring atmosphere with facilities to ensure a person is given a dignified send off by the home. It ensures that the remaining family members and friend are consoled in order to have the faith that one day they will meet again. The upcoming funeral home will explore its competitive edge to offer these values and functions and help promote the living standard of the employees.

Its competitive edge is the fact that many have not ventured into the business in Monroe as well as the cremation, which is offered by very few funeral homes. It will uphold the values and purposes of a burial or a funeral for that matter. The values and the purpose of a funeral gathering is to appreciate someone for the life well lived, wish him a farewell and support the ones left behind with consolation.

Sales Strategy

In meeting our sales, a strategy has been laid down to ensure its achievements. The home will bring on board executive directs sales agent who will employ the process of personal selling to approach customer, present the product, convince the customer to purchase the product and close the sales. The sales executive may then request for more leads from the customer. Once a sale is closed, the customer will be like part of us. Through him, we shall reach other hundreds of customers out there

VII. FINANCIAL ANALYSIS AND PROJECTIONS

This analysis and plan aims at getting a loan of $ 184,000 with the total net worth of the business being. Our start-up expenses of $32,500 and asset purchases of $151,500 are to be financed by loan

Start-up Funding Amount in $

Start-up Expenses to Fund

32,500

Start-up Assets to Fund

151,500

Total Funding Required

184,000

Assets

Non-cash Assets from Start-up

58,500

Cash Requirements from Start-up

121,250

Additional Cash Raised

–

Cash Balance on Starting Date

–

Total Assets

235,300

Liabilities and Capital

Liabilities

Current Borrowing

184,000

Long-term Liabilities

–

Other Current Liabilities (interest-free)

–

Total Liabilities

184,000

Capital

Planned Investment

Owner

58,500

Investor

–

Additional Investment Requirement

–

Total Planned Investment

58,500

Loss at Start-up (Start-up Expenses)

(32,500)

Total Capital

26,000

Total Capital and Liabilities

210,000

Total Funding

242,500

VIII. FUNDING REQUEST AND EXIST STRATEGY

Starts up costs of a funeral home are much higher than businesses of the same size. The costs of cars are very high and the small amount of equipment that is needed is high. All these items are things that you have to have to operate a funeral home aside from the facilities. All the things that are in this list are things that are absolutely required and are not things that you can do without.

To have a funeral home you must be able to embalm a body and make-up which you need tables for. The embalming table is stainless steel which is what makes it so expensive. You must have a van and a cot to make removals. Another big thing is the cost of the hearse with is probably the biggest expense cause it has to in a since be custom made. The last large expense is a cooler to keep bodies in that aren’t embalmed or are going to be cremated

We are therefore requesting for a funding of $ 184,000 which we are sure to pay in the next one year that is a period of 12 months. The amount is to assist us get the required material for the start of the business. We shall repay the amount together with the interest required. On a straight line basis without the inclusion of the interest rate we are sure to pay the following amount:

Amount borrowed $ 184,000

Period of repayment 12 months

Monthly repayment 184,000 / 12 months

= $ 15,333.33 per month

Once the amount is paid up we shall be glad to be a member of the bank. All our proceeds shall be used through your good bank.

We therefore humbly request for the financial assistance to help us achieve the objective and promote the lives of the people of Monroe by giving the family members of the deceased a good consolation and ensuring that the deceased is given the best send off by the people he or she loved. We are proud to be associated with you and we look forward to doing business.

APPENDICES

Appendix 1: Financial Requirements

Appendix 1a): The financial requirements of the firm visa a viz the actual that we be used up during the implementation

Item

Cost

Estimate/Actual

Start-Up Expenses

Accountant Fees

1500

Expensed Equipment

2500

Financial Institution Fees

Identity Set/Stationary

3000

Insurance

5000

Legal Fees

10000

Licenses/Certificates/Permits

1000

Marketing Materials (cards)

2000

Payroll (with taxes)

2000

Professional Fees – Other

2000

Travel

Utilities

1500

Web Fees

2000

Other

Total Start-Up Expenses

32500

Start-Up Assets

Cash Balance for Starting Date

Equipment

25000

Furniture & Fixtures

30000

Leasehold Improvements

Cars

Rent Deposit

Signage

3000

Utility Deposit

500

Other

Total Start-Up Assets

58500

Total Start-Up Requirements

151500

Appendix 1 b): The required assets

Item

Quantity

Cost

Equipment

Hearse

1

100000

Removel Van

1

35000

Embalming Table

1

2000

Removal Cot

1

1300

Prep Table

1

900

Embalming Pump

1

800

Church Truck

1

1000

Prep Stuff

1

2500

Cooler

1

8000

Other Costs

Start-Up Investment-TOTAL

$242500

Cash Reserve

$121250

Total Start-Up Investment + Capital Reserve

$363750

Appendix II: The Work plan and how the activities will be done

PROJECT

JANUARY

MARCH

APRIL JUNE

JULY

SEPTEMBER

OCTOBER

DECEMBER

Drawing the plan

Collection of the materials

Seeking for funding

Purchase of the assets

Building project inception

Doing a market research for determination of the demand level

Getting the required people in time to begin business

Registration of the company

Appendix III: Statistics found out on the marker of the Monroe State

Series 1 represents the Mortality rate of the Boomers

Series 2 represents the Mortality rate of the Silent generation

Series 3 represents the Mortality rate of G1 Generation