Funeral Home Management & Merchandising Week 7 & 8

Demonstration group (educational group)

3 or 4 caskets utilized to educate the selecting party regarding the elements of casket construction

Recommended size of the selection room

40 - 60 square feet per casket

Cash discount

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

Quantity discount

A ______ ______ is the amount by which the bill or invoice will be reduced when a minimum quantity of merchandise has been ordered

Demonstration group

A _______ ________ or educational group is a group of three or four caskets utilized to educate the selecting party regarding the elements of casket construction

Mausoleum

A building containing crypts or vaults for entombment. an above ground structure for burial

"Value progression"

A concept all consumers appreciate: the more the consumer spends, the more value he should receive.

Quartile

A division of the total into four intervals, each one representing one-fourth of the total.

True

A foot candle is the amount of illumination produced by a source of one candle at a distance of one foot

Unit (package) pricing

A method of price quotation which creates one total price package for both service and merchandise. Ex. You look in the casket and see a price. That price covers the entire funeral cost.

Graduated recovery

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

Columbarium

A structure, room, or space in a mausoleum or other building containing niches or recesses used to hold cremated remains.

Sales frequency

Answers the question " How often is this item sold?" The number of times sales in a given price bracket occur over a fixed period of time

Tolling of the temple bell

Buddist religion (beginning of service)

Quantity discounts

Buy a certain amount and pay less per item

Rebates

Buy an item and mail in proof of purchase to receive money back on the said item

Analysis of the data

Comes from a sales frequency chart

Sales objectives

Critical to any funeral firms achieving its target profit is the careful development of _____ _____.

True

Direct lighting refers to illumination directly shining on an objectq

1. Is a planner 2. As an organizer - What and how to be done 3. As an activator - puts things into action 4. As a controller - determines what is going on and how

Four qualifications of a manager

1. Cash discounts 2. Quantity discounts 3. Rebates 4. Consignmen

How will the purchases be paid for:

True

In the fractional display only a portion of the casket shell, cut by the manufacturer, is displayed

True

Indirect lighting provides a general feeling of illumination

1. Evaluate its market 2. Scrutinize its sales history 3. Take into account and consider a number of criteria specific to the merchandise it plans to offer 4. Funeral firm must integrate its proposed product line with its existing service offerings - or vise versa

List three of the questions that must be answered as a funeral home develops its sales objectives:

Serve the family Serve society and the community at large

Management objectives of the Funeral Director

Cost & Price

Markup, also known as "gross casket margin" or "margin," is the difference between merchandise _____ and selling _______.

Consignment

Offer an item for sale and then pay for the item once it has been sold

Cash discount

Pay cash and receive a certain percentage off

1. Recognize the relationship between the pricing of merchandise and the pricing of services 2. Not everyone will need any or all of your merchandise; they will always need your service (basic services = non declinable charge) 3. Care should be given to not place all the profit expectation in merchandise alone

Pricing principles

Modified Declining price

Similar to declining method except the lowest priced casket is less expensive

1. Availability of the product 2. Price 3. Quality 4. Eye appeal 5. Supplier recommendations

Some considerations regarding merchandise to be offered would include:

True

Successful merchandising of funeral goods will deliver maximum value to the consuming public while simultaneously positively impacting funeral home operating revenu

Balance Line formula

Term used to describe having the correct number of caskets in each pricing quartile. The number of caskets in each quartile is determined by the FH pricing system: 1st Quartile - 10% of caskets 2nd Quartile - 27% of caskets 3rd Quartile - 40% of caskets 4th Quartile - 23% of caskets

True

The Consumer Value Index is found by dividing the wholesale cost of the merchandise by the retail price of the merchandise

True

The Merchandise Value Ratio examines the relationship between the wholesale cost of the merchandise and the total cost of both services and merchandise to the consumer

Fixed Multiple (Straight Line)

The __________ ________ is a price determination method whereby the casket cost is multiplied by a constant factor.

True

The appropriate presentation and display of funeral goods can ease a family's selection room anxiety and, at the same time, increase the funeral home's chances of achieving its sales objectives

Markup

The difference between merchandise cost and selling price; i.e. gross margin. Markup can also be done by percentage. Furthermore, markup can be done by applying a fixed dollar amount (add the same dollar amount to the wholesale cost of item of merchandise)

Indirect

The method of selling merchandise whereby the funeral director does not stay in the selection room during the selection process is known as the ________ selection room procedure

Direct

The method of selling merchandise whereby the funeral director remains in the selection room throughout the selection process is known as the _______ selection room procedure

Benchmark

The most expensive casket and the least expensive casket will each serve as a ____________ to which all other offerings may be compared.

Itemization

The oldest form of price quotation in funeral service and the current method required by the FTC. Each item is given an individual price

Consumer Value Index (CVI)

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

Funeral director

The person who notifies social security about a death will usually always be the ________ ________ and they should be notified as soon as possible.

True

The recommended size of the selection room is determined by allowing forty to sixty square feet per casket

True

Vertical merchandising is concerned with providing consumers with a selection of prices

"Consumerized"

_____ pricing is another way of describing a method of pricing so that actual price figures are familiar to the consumer.

Direct lighting

_________ _________ is best used to accent color, form, and shadow

Horizontal

_________ merchandising is concerned with the actual number of choices available at each price rung on the vertical merchandising ladder

Priest casket (slip panel)

a casket opening style in which the cap or lid at the head end of the casket is completely removed from the casket for the purpose of viewing; the remains may be viewed from either side of the casket.

Memorial park

a cemetery or section of a cemetery with only flush to the ground type markers.

Sales frequency chart

a chart on which all sales are listed showing the number of sales in any sales bracket.

Functional pricing

a method of price quotation by which the charges are broken down into several major component parts, such as professional service, facilities, automobile, and merchandise

Unit pricing

a method of price quotation in which one price includes both service and casket

Functional pricing

a method of price quotation in which the charges are broken down into several major component parts such as professional services, facilities, livery and merchandise

Bi-Unit Pricing

a method of price quotation showing separately the price of the service to be rendered and the price of the casket

Bi-unit pricing

a method of price quotation showing separately the price of the service to be rendered and the price of the casket

Obituary

a news item concerning the death of a person which usually contains a biographical sketch

Fixed multiple

a price determination method whereby the casket cost is multiplied by a constant factor

Graduated recovery method

a pricing method where the markup varies

graduated recovery method

a pricing method where the markup varies

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 markup

Package pricing

a pricing method which groups together selected services and/or merchandise

Niche

a recess or space in a columbarium used for the permanent placing of cremated remains the aesthetic covering for the foot cap or inner foot panel of the casket

Median

a value in an ordered set of values which represents the midpoint, whereby there are an equal number of values above and below the midpoint value.

Eulogy

an oration praising an individual, usually after death

Direct lighting

illumination directly shining on an object

vertical merchandising

is concerned with providing consumers with a selection of prices, with steady and obvious value progression at each rung on the price ladder

Horizontal merchandising

is more concerned with the actual number of choices available a each price rung on the vertical merchandising ladder; the greatest number of model choices exist at or slightly above the target sales objective

Burial permit

is the legal record that final disposition has occurred (burial, removal, or cremation)

Consecutive Method of display

placing caskets for selection in their order of increasing or decreasing value.

presentation

refers to the process by which the consumer is informed about the products about to be purchased

Indirect lighting

reflected illumination of an object

Foot candle

the amount of illumination produced by a source of one candle at a distance of one foot

incandescent lighting

the illumination resulting from the glowing of a heated element

itemization

the method of price quotation by which each unit of service and/or merchandise is priced separately.

Indirect Selection Room Procedure

the method of selling merchandise whereby the funeral director does not stay in the selection room during the selection process

Direct Selection Room Procedure

the method of selling merchandise whereby the funeral director remains in the selection room throughout the selection process

Merchandising

the purchasing, pricing, display and sale of merchandise

Merchandise Value Ratio (MVR)

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

Average (mean)

the sum of a group of numbers divided by the number of units

Range

the upper and lower limits of a series of numbers

Mode

the value that occurs most frequently in a group of numbers

Fractional display

use of portions of caskets (1/2, 1/4, 1/8) in the selection room v. full sized caskets