Chapter 13: The Selection Room

What are the four types of casket selection rooms?

Traditional selection rooms, fractional display rooms, digital display rooms, and catalogs. 

What are the four types of lighting found in a display room?

Fluorescent, incandescent, direct, and indirect.

What is the difference between a casket rack and casket standard?

A casket rack can hold up to 3 caskets at once, one on top of the other. The casket stand supports only one in the selection room.

How many caskets should be in your display room?

At minimum, twelve. At maximum, thirty.

How many square feet apart do you place your caskets in a casket room?

40-60 square feet

the consecutive method

When caskets are arranged in order of increasing or decreasing price.

direct selection room procedure

When the funeral director remains in the room throughout the entire selection procedure. 

indirect selection room procedure

When the funeral director leads the family inside the selection room, but does not stay in the room for the entire selection procedure.

The First Step of Setting Prices

Determine total overhead

The Second Step of Setting Prices

Allocate gross profit from merchandise

The Third Step of Setting Prices

Determine case count

The Fourth Step of Setting Prices

Set prices on services

The Fifth Step of Setting Prices

Do a hypothetical revenue test

The Sixth Step of Setting Prices

Create packages

The Seventh Step of Setting Prices

Test your consumers

Add a little bit to last year.

AALBLY

Let my CPA do it.

LMCPADI

Be one hundred bucks over my competitor.

BOHBOMC

Be one hundred bucks under my competitor. 

BOHBUMC

Take a wild ass guess.

TAWAG

Markup

the difference between merchandise cost and selling price (i.e. gross margin)

Markdown

the reduction of the selling price

pet disposition

When families are interested in some form of post-death ceremony for their pet. This can range from visitation, cremation, urn, and keepsake purchases or grave purchases and burials.

Merchandise

Goods that are bought and sold.

Merchandising

The purpose, display and sales of goods.

Fluorescent lighting

The illumination produced by a tubular electric discharge lamp; the fluorescence of phosphors coating the inside of a tube.

Incandescent lighting

Illumination resulting from the glowing of a heated filament

Direct lighting

Illumination directly shining on an object.

Indirect lighting

Reflected illumination of an object.

Church Truck

A wheeled, collapsible support for the casket, used in the funeral home, church, or other location when moving a casket.

Alternative pricing

Each group would have a low, medium, and high cost casket

Consumer value index (CVI)

Wholesale cost. The percentage derived by dividing the wholesale amount of the merchandise by the retail price of the merchandise.

Gross Casket Profit (Margin)

Retail Price minus Wholesale Cost; measures profit of each casket to the funeral director/firm. 

Merchandise Value Ratio (MVR)

The relationship between the wholesale cost of the merchandise and the total cost of both service and merchandise to the consumer.

Fixed Multiple or Times Factor

A price determination method whereby the markup is multiplied by a constant factor. The same markup is applied to all caskets.

Graduated Recovery

A pricing method where the mark up varies. Higher priced caskets are given a higher markup.

Declining Price Structure

A pricing method where there is an inverse relationship between the markup and the price of the casket. Higher priced caskets given a lower mark up.

Sales Frequency

The number of times sales in a given price bracket occur over a fixed period of time.

Sales Frequency Chart

A chart showing the number of all sales in any sales bracket.

Itemization

A method of pricing by which each unit of service and merchandise is priced separately.

Unit Pricing

A method of pricing which creates one total price package for both service and merchandise.

Bi Unit Pricing

A method of pricing that shows the price of the services and the price of the casket separately.

Functional Pricing

A method of pricing by which the charges are broken down into several component parts. An example could be: Professional services, facilities, automobiles, and merchandise.

Package Pricing

A method of pricing where certain items of service and merchandise are grouped together and sold at a specific price.

Inventory

Those goods or stock of goods which are held for resale.

Inventory Turnover

The number of times the average inventory has been sold or used up.

Economic Order Quantity (EOQ)

The quantity to be purchased which minimizes total costs.

Cash Discount

A reduction of the price given for payment of an account within the limits established by the sales contract.

Quantity Discount

 A reduction in the amount of a bill when a minimum quantity of merchandise has been ordered.

Rebate

A return of a portion of a payment.

Consignment

The funeral director does not have to pay for the merchandise that will be displayed until it is sold.

Funeral Ceremony

A service commemorating the deceased with the body present.

Memorial Service

A ceremony commemorating the deceased without the body present.

Graveside Service

A ceremony or ritual, religious or otherwise conducted at the graveside

Visitation (calling hours, visiting hours)

Time set aside for friends and relatives to pay respects for the deceased prior to the funeral service.

Direct Cremation

A disposition of human remains by cremation without formal viewing, visitation, or ceremony with the body present.

Immediate Burial

A disposition of human remains by burial without formal viewing, visitation, or ceremony with the body present, except for the graveside service.

Package

More than one product or service combined into a single presentation.

Hospitality Service

Offers the family a variety of products and services, including food, drink buffets, family style meals or a cocktail party.

Event Planning

 Moving beyond formal funeral planning to create a ceremony for celebrating the life of the deceased.

Green Offering

 Offering the disposition in an environmentally friendly method.