Dignity

Would you credit it?

28 May 2010
Charles
No comments
Categories: Dignity

Here’s an interesting insight from the US into the robustness of the business model of Services Corporation International, the clumping, predatory and often bungling funeral chain which begat our very own Dignity Caring Funeral Services.  Dignity is not a notably bungling organisation, but the challenges they both face are related:

Because of the lack of industry growth, Service Corporation and its peers have increasingly focused on preneed sales to drive revenue. While paying for a funeral at the time of death is unavoidable, paying in advance is highly discretionary. As a result, the company’s revenue has declined through the recession. More important, proceeds from preneed sales are placed in trusts until the actual funeral services are delivered. Service Corporation carried an investment portfolio of about $3 billion at the end of 2009, with about 40% of that portfolio invested in equities. If this portfolio suffers serious impairments or generates insufficient income, the company could be materially affected.

Dignity is profitable, but it is also leveraged. And, as Andrew Plume pointed out a while back, its figures in many branches are very low. The business pages of UK newspapers customarily talk up Dignity and advise investors that it’s a safe haven for their money. I don’t know that that is how it is seen by any who know the industry. Have any of you funeral directors out there got any money in Dignity?

The single most influential factor is this: the public does not like using a chain funeral director.

Read the whole story here.

Dig those stats

17 May 2010
Charles
1 Comment
Categories: Dignity, funeral cost
I received this interesting insight into Dignity’s profitability the other day from a good friend of the GFG, Andrew Plume.
I was mulling over some Dignity stats the other day.

Much is made of 65,000 funerals having been carried out for year ending December 2009. Given that they merrily declare having “546 funeral locations” in the UK, are those figures really that strong?

This equates to 119 funerals per branch per year. That’s hardly impressive and looking at the name firms that they trade under, some of whom were fantastic names when long ago independent, I would personally be very unhappy with these results. As I’ve said before, some of these branches simply have to be considerably under performing. Dignity reckon that their market share last year was 11.8%. Is that really such a good ‘return’?

Compare this to at least two independent family firms that I know well. They both own their own buildings and each only trade from one location. Both are on course for 550-600 funerals this year, possibly more. Each of them have minimal advertising costs and no vast amounts of area management to pay for, which is the case with Dignity. Both of these firms are cheaper than Dignity.

Not difficult to draw conclusions on profitability?
Hmnn…

Thanks, Andrew!

The wages of solicitude

12 March 2010
Charles
No comments
Categories: Dignity, funeral cost

We worry about our football clubs. Many are encumbered by stonking debts. Manchester United owes £716 million.

What of our big undertaking businesses? Well, Dignity Caring Funeral Services has just published figures which provide the current answer to that question. And the answer is (sit down, please, and clutch your whisky) that Dignity are leveraged to the tune of £250 million.

Bad news: in 2009 they performed 3,700 fewer funerals than in 2008.

Good news: profits rose 6 per cent to £37.5 million.

Bad news: price per funeral rose by 6 per cent.

Good news: shareholder payouts are up by 10 per cent.

Conclusion: caring for investors, crapping on consumers.

Take it to them!

15 February 2010
Charles
No comments
Categories: Co-op, Co-operative Funeralcare, Dignity, funeral cost

It’s widely known in the funeral business that the prices charged by Co-operative Funeralcare and Dignity are on the whole higher than those charged by their independent competitors – the family businesses and new start-ups – so many of them passionate ex-Funeralcare employees who tell me they learned everything about what not to do at Funeralcare.


Funeral consumers don’t know about this. They don’t do price comparison shopping. And considering most of them buy just two funerals in their lifetime, and most of them don’t have any recently comparable experience, they just assume hopefully that the prices charged by everyone are about the same. They assume that Funeralcare, with its ethical trumpeting and working class roots in will be on their side.

Caveat emptor! And here let’s exonerate Dignity. Dignity’s in it for the money. It’s making lots. Well done, chaps! Don’t necessarily like you for it, but realise that the rules of the game are capitalism, and that you play hard and, er, fair.

Why do so many independents moan about the higher prices charged by the big boys yet do nothing to get the message out? Because it would look undignified? I don’t know that it would look less dignified than boasting about how cheap your low-cost funeral is as you do at the moment in your coded way.

In Nottingham, the eminently respectable and excellent AW Lymn make no secret of their competitive pricing structure. They break it down and spell it out graphically. Way to go, I’d reckon.

I’m grateful to blog follower Andrew Plume for this intelligence. Thank you, Andrew.

Go to the AW Lymn website. Click on the package prices pdf at the foot of the page, right-hand side.