SizeMatters_pt3Live Oak Bank specializes in helping funeral homes and cemeteries invest in their futures, offering both capital and strategy to customers to help them grow. Each of the articles in this series deals with a growth opportunity that owners and managers sometimes miss.

Part 3- Investing In Facilities

Why Status Quo is Really Just the Latin Word for “Left Behind”

Think about first impressions for a minute. You’ve just walked into a hotel, a restaurant or a spa as a customer and the first thing you notice is the time-warp: it looks like nothing has changed in the last 25 years. Even if the whole place is immaculately maintained, it’s still 1987 on the inside, and 2012 in the rest of the world. What’s your first impression of that business?

Welcome to the hospitality sector, where, for better or for worse, the design and quality of your facilities is a key part of your brand identity. Whether you like it or not, your facility design makes a statement about who you are, how you think and what you can do. After a generation of marketing by Starbucks coffee and Starwood Hotels, American consumers have been trained to analyze and evaluate facility design when they make buying decisions. Best (or perhaps worst) of all, they’ve learned to make that evaluation in the blink of an eye, and almost unconsciously.

Form vs. Function

So you’re being dragged, maybe a little reluctantly, into viewing facility design as a competitive strategy. It’s a big idea that has a lot of interconnected parts. How do you make it work for you without breaking the bank? Like so many other questions, the issue of facility design can benefit from being broken down into bite-size pieces. One of the easiest approaches is to think about form vs. function. (At this point any architects and designers who read this will begin to twitch and mutter involuntarily. Most of them passionately believe that form and function can’t be separated, and of course they’re right. Still forcing yourself to separate them really can help organize your thoughts.)

Some of the most straightforward facility opportunities come form thinking about function. Most U.S. funeral homes were built around a different set of customer needs that are starting to be obsolete. For most funeral homes there are functional updates that can build revenue, preempt competition and deepen customer relationships. A few possibilities include:

  • adding a multi-purpose space for catered events
  • adding a crematory with a family viewing or event space
  • redesigning lobby spaces to promote a much-improved visitor arrival experience
  • upgrading chapel space to support the needs of more contemporary services and families

Any of these functional projects can help align your firm’s capabilities with the demands of 21st Century funeral service. If they’re backed up with new products and services on your General Price List, they can generate an immediate revenue impact as well.

Aesthetically Obsolete – Who Knew?

For many funeral homes, the time warp is a real problem. When they last updated their facilities 20, 30, or even 40 years ago, they made a real investment. They spent real money and chose things that were built to last. Now after 20 years of being gently used twice a week, everything is hardly even broken in. Those chairs, the carpets and that wallpaper still have years of life left in them. Them problem is that teal and mauve still mean the same thing they did 25 years ago: Hey everyone! It’s the 80′s!

This is where form takes the lead in the “form vs. function” debate. Whether we call it aesthetics, interior design or “the visual built environment,” we’re talking about the elements that provide a context for everything we do. Even after the purely functional requirements are met, light, color, texture, and style can dramatically change the impression you make on customers.

Even more important is the impression we make on funeral guests – the people attending services who technically aren’t your paying customers. Those guests outnumber the arranging family members (the funeral “hosts”) by 15 to 1. They’re also your most important source of future business. Statistically speaking the funeral hosts aren’t going to be back for 7-10 years. Some of those funeral guests, on the other hand, are going to be in the market for your services in the next 6-18 months. This time around they won’t be exposed to your products, your pricing or your extraordinary care for the grieving funeral hosts. They will, however, experience the design of your facility and they’re going to use that experience to judge your entire business. It may be the only thing they remember; it’s also one of the only elements you can actually control. Making that experience positive is crucial to the future of your business.

Drive-by Shootings

There is one more visual design opportunity that many firms overlook: changing the drive-by vista for your funeral home. It’s one of the most visible forms of brand exposure, and it represents a huge investment on your part. Unfortunately, if you’re like many firm in the market, you’ve been in that location for years, even decades and become largely invisible. Hundreds or thousands of customers and prospects drive by each day on their habitual routes. They long ago stopped seeing your facility because it’s just another constant in a crowded landscape. The opportunity here is to change that drive-by vista in a way that earns you new attention. Here are a few possibilities to consider:

  • Changing your primary sign. It’s a quick and cheap to change just the face to get updated graphics. It’s better still to change size, color, construction, or placement to make a more noticeable difference. If your location features much night-time traffic, consider adding lights. Some firms are also trying digital panels to as a way to further increase visibility.
  • Updating your landscaping – in the hands of a good landscape architect of designer, this can give you a lot of visible impact for a relatively small investment. It can also be specifically designed for low maintenance to help control your ongoing costs.
  • Updating your facade – you can do this at a fraction of the cost of updating the entire building, and enjoy a dramatic change in your visibility. It’s an opportunity to rethink the shape, color, and ornamentation so that they reinforce the message you want visitors to receive. Arguably it’s only helpful if your facade is clearly visible from the street.
  • Reconfiguring the main entrance to the property – this can involve realigning driveways, landscaping, and the main entrance of the building for the best visual effect as well as improved traffic flow. This can be a great opportunity to make the most of both the drive-by vista for prospects and the arrival/first impression experience for guests.

Go Big or Go Home

If you choose to invest in improvements to your facility, it’s important to leave your naturally conservative nature at home. Too many funeral directors make incremental investments or minor changes in style with the conscious or unconscious goal of staying under the radar. While that is better than doing nothing, it also wastes the visual and psychological impact of the Big Change.

If you have the right access to capital, it’s better to condense your improvements and make the Big Change. Unveil everything together for the biggest possible impact. If you want to counteract decades of comfortable invisibility, small changes are for the faint of heart. If you want your facilities investment to make a powerful statement in support of your marketing, your business and your brand, go big or go home.

The Common Ingredient

All of these facility strategies require one common ingredient: capital. As a business owner, your facility is likely to be your biggest asset. Maintaining and upgrading that facility can be a capital-intensive effort. At Live Oak Bank, it’s our job to provide the final ingredient – the capital you need to make the most of your facilities and grow your business.

 

About the Authors

Doug Gober is a Senior Loan Officer with Live Oak Bank. A CPA by training, Doug joined Live Oak after working with some of the leading companies in the funeral industry for more than 30 years, including Batesville, York Casket, Matthews International and Carriage Services. 

Paul Seyler is President of Competitive Resources, Inc., a New Orleans-based firm providing research, strategy and execution support to companies both inside and outside the funeral.

To download a copy of this article, click here: Size Matters: Making the Case of Growth Pt. 3