Funeral Home Accounting and the Importance of In-Depth Analysis of Financials

Funeral Home Consultants Explain Importance of Evaluating Fixed and Variable Costs in Relation to Funeral Home ROI and Overall Success

Our funeral home consultants understand the dramatic impact in-depth analyses of fixed and variable costs can be to a funeral home’s ROI and overall business success. In funeral home accounting there are a variety of factors to take into account when budgeting, and budgeting is absolutely essential to the success of funeral homes. Below, our funeral home consultants have listed the major areas to account for when creating a funeral home budget. We’ve also provided ways to minimize these costs to help secure your long-term success as a funeral home owner or director.

Funeral Home Consultants Discuss Fixed and Variable Costs

As in all business there are fixed and variable costs associated with owning and operating a funeral home. While some areas only account for a small percentage, it is important not to dismiss these as losses tend to add up quickly when not fully accounted for. Below, our funeral home consultants have created an abbreviated list of the most important areas associated with funeral home accounting and budgeting.

Funeral Home Facility Costs: Most funeral home facility costs are fairly fixed and include things like insurance, utilities, landscaping, repairs and maintenance. Funeral home facility costs generally account for 8-10% of incurred expenses.

Funeral Home Payroll: Depending on the amount of staff, funeral home payroll expenses usually amount to about 25-30% of your expenses.

Hearses and Autos: Hearses and other service vehicles account for about 2-4% of funeral home expenses and include things like gas, oil, repairs, maintenance, insurance and licenses.

Funeral Home Marketing: Funeral home marketing is a fairly fixed expense and should account for roughly 3-6% of your funeral home expenses. Be sure you’re utilizing the best avenues for funeral home marketing. Some funeral home marketing avenues to consider may include a website, sponsoring print and internet obituary listings and radio, among others. Remember, the right marketing avenue for your funeral home may not be that of other local funeral homes. Sometimes, it takes thinking outside the box to successfully capture the uncaptured market. It is also critical to note funeral home marketing should be one of the last things to exempt from your budget if you’ve come into tough times; in fact, this is the time you should increase your marketing budget!

Miscellaneous Funeral Home Expenses: Miscellaneous funeral home expenses may include things like office supplies, funeral home accounting services and legal expenses, bank fees, etc.

Funeral Home Consultants Provide Ways to Control Operational Costs

Our funeral home consultants know the best way to control operational expenses is to set strict budgets and ambitious, yet attainable benchmarks. Below are a few ways to help local funeral homes manage fixed and variable operational costs.

  • Categorize expenses into areas such as revenue, cemetery products (caskets, vaults, urns, etc.), payroll, funeral home facility operation costs, auto and more.
  • Buy wholesale interment products (purchase these wholesale interment products only after performing an in-depth analysis of your most popular cemetery supplies, as well as after identifying developing trend lines).
  • Set high, yet attainable benchmarks for each budget category.
  • Utilize funeral home management software for seamless file storage and accurate budgeting.

Rather than spending hard time working on your business, our funeral home consultants allow you to work where it really matters: in your business and local communities. Our funeral home consultants perform detailed reviews and in-depth analyses of financial records and statements for accurate evaluation and assessments of your funeral home’s operation pros and pitfalls. When you work with a funeral home consultant from Tribute you’re hiring experienced industry professionals with the skills, insight and know-how to help you achieve greater success. Whether you need funeral home management services, funeral home accounting, or funeral home consulting, Tribute has the industry leaders to help you.