Exam 1 Flashcards
Purchasing, pricing, display, and sale of merchandise
Merchandising
Merchandise includes but is not limited to
Caskets and burial containers OBCs Cremation and alternative containers Urns and cremation oriented products Monuments, memorials, cemetery merchandise Burial Clothing Personalization options Sundry items
What is the order of the PRD?
Spouse/Domestic Partner
Adult Children
Parents
Adult Siblings
Personalization is an _________ not just products
Attitude
_________________ enhances the experience
Products and Merchandise
Name some personalization options
Casket
Environment in funeral home
Music
Hobbies of deceased
Any funeral in which your normal regular pricing quotation is applied
Adult Formula Service
The total package of service from first call to post funeral counseling
Adult Formula Service
NMS
National Mortuary Shipping
Any service where your normal pricing quotation is NOT used, in effect only a partial service sale
Adult Non-Formula Service
What are some examples of Adult Non-formula service?
Ship in Ship out Contract funerals Indigent cases Memorial Society contract Full service followed by cremation Stillborns to children
One of the primary responsibilities of any business is to do what?
Generate enough profit to ensure its existence and ability to continue serving its clientele
How is profit accomplished?
Evaluate the market
Scrutinize sales history
Considerations regarding merchandise it plans to offer
Integrate product line with its existing service offerings
Evaluating the market includes
Demographics, vital statistics, economic base, and burial habits
How often should you evaluate your sales history?
6 months
To obtain by paying money or its equivalent to buy for a price
Purchasing
This will help maintain a balanced line in the selection room
Planned Buying
How many people should be assigned to purchasing per funeral home?
1
Why should a sales person never be allowed in your selection room?
Never let them see what you are buying
Never let them see who you are buying from
Never let them see your retail price
A reduction of the price given for payment of an account within the time limits established by the sales contract
Cash Discount
The amount by which the bill or invoice will be reduced when a minimum quantity of merchandise has been ordered
Quantity Discount
The return of a pertion of a payment
Rebate
To give an agent to be cared for or sold
Consignment
Successful merchandising of funeral goods will deliver __________ to the consuming public while simultaneously positively impacting funeral home operating revenue
Maximum Value
The purchasing, pricing, display, and sale of merchandise is
Merchandising
Critical to any funeral firm’s achieving its target profit is the careful development of __________
Sales Objectives
A reduction of the price given for payment of an account within the time limits established by the sales contract
Cash Discount
The amount by which the bill or invoice will be reduced when a minimum quantity of merchandise has been ordered
Quantity Discount
List the sales questions that must be answered as a funeral home develops its sales objectives
Evaluate the Market
Scrutinize sales history
What merchandising
Integrate proposed product line with existing offerings
The FTC requires funeral directors use what pricing system
Itemized
The method of price quotation by which each unit of service and/or merchandise is priced separately
Itemization
You can still offer packages as long as this happens
The family receives a fully itemized price list
A method of price quotation in which one price includes both service and casket
Unit Pricing
Developed between 1925 and 1937 to overcome multiunit pricing
Unit Pricing
This was the most significant in the development of the packaged funeral (unit pricing)
The Great Depression
Unit pricing eliminates what between services and merchandise
Arbitrary Division
Unit Pricing shows families total cost without bothersome details. This is known as
Bottom Line Philosophy
Unit pricing simplifies what?
Accounting and billing
Unit pricing simplifies explanation and is easily
Explained
Unit Pricing exaggerates the importance of this
Casket
Unit Pricing minimizes the importance of this
Service
Economically depressed consumers are usually subsidized by this in unit pricing
More Expensive packages
The consumer is unable to do this in unit pricing
Make a free selection of components
This is the only basis of comparison with competition in unit pricing
Total Price
Unit pricing fails to educate the consumers on this
The true value of merchandise and service on the retail level
A method of price quotation showing separately the price of the service to be rendered and the price of the casket
Bi-Unit Pricing
The funeral directors who had no selection room were forced into this system out of necessity
Bi-Unit Pricing
Why did funeral directors start using the bi-unit pricing strategy
They wanted to be seen as professionals
What came from the need for the funeral directors to be seen as professionals?
The professional service charge
Bi-unit pricing puts an emphasis on this, as well as merchandise
Service
Consumers recognize this in bi-unit pricing
The value of service
Bi-unit pricing permits
Equal charge for equal service
Bi-Unit Pricing facilitates comparison between
Caskets and other commodities
The division between service and merchandise in Bi-Unit Pricing is still arbitrary, so the question remains
Where to put overhead, where to put profit
Bi-unit pricing may create _______ for the consumer
Confusion
Bi-Unit pricing does not give the consumer freedom to
select components
Each and every function, unit of service and item of merchandise is priced separately
Full Itemization
Sometimes referred to as the historical pricing method
Full Itemization
What are the common units in full itemization
Professional Services
Use of Facilities
Automotive Equipment
Merchandise
Full itemization gives the consumer a _______ of the charge
Clear Understanding
Services and merchandise are more thoroughly discussed in full itemization, and consumers are made to realize
All the components of a funeral
What is the only non-declinable fee on the price list?
Professional services fee
Charges broken down into several major component parts
Functional Pricing
How many parts are normally in the Functional Pricing method
4
What are the 4 components normally found in Functional Pricing?
Professional Service
Use of facilities
Rolling Stock
Merchandise
Functional pricing was initiated to do what?
Impart more knowledge to the consumer
Functional pricing was designed to bring ________________
Uniform order
FTC requires _________
further itemization
Functional Pricing was designed as a compromise to do what?
reduce pressure against funeral service by memorial societies
Items obtained from a third party and paid for by the funeral provider on the purchaser’s behalf
Cash Advance items
Cash Advance Items include
Clergy Death Notice Certified copies of death certificate Cemetery or crematory charges Shipping costs Flowers Any other cash accomodation
The difference between merchandise cost and selling price
Markup
Wholesale cost / Retail Price
Consumer Value Index
Wholesale cost / (Total merchandise + services)
Merchandise Value Ratio
A pricing strategy in which a fixed amount chosen by determining the amount of profit it wishes to generate is added to every casket
Fixed Dollar Amount Method
What is a major disadvantage to the Fixed Dollar Amount Method
Consumers that buy low end merchandise are unfairly penalized and receive little value for their dollar
A price determination method whereby the mark-up is multiplied by a constant factor; Same mark-up applied to all caskets
Fixed Multiple Method
A pricing method where the mark up varies; Higher priced caskets are given a higher mark up
Graduated Recovery
A pricing method where there is an inverse relationship between the markup and the price of the casket; Higher caskets are given a lower markup
Declining Price Structure
Similar to declining method except the lowest priced casket is less expensive
Modified Declining Price
The sum of a group of numbers divided by the number of units
Average
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
Median
The number that appears most frequently in a listing of numbers
Mode
A division of the total into four intervals, each one representing one-fourth of the total
Quartile
The caskets sold in the 2nd and 3rd quartile
Range
An out of date term used to describe having the correct number of caskets in each pricing quartile
Balanced Line
The number of times sales in a given price bracket occur over a fixed period of time
Sales Frequency
A chart on which all sales are listed showing the number of sales in any sales bracket
Sales frequency Chart
The total number of units divided by 4
Unit Quartiles
Division into fourths by price
Price Quartiles
How many caskets should be in your display room
12-30
How big should the display room be?
40-60 square feet per casket
Amount of illumination produced by a source of one candle at a distance of one foot
Foot Candle
How many foot candles should be in the display room
90-100
Placing the caskets for selection in their order of increasing or decreasing value
Consecutive method
Caskets grouped according to their relative positions within the value/price progression
Good-better-best
The use of portions of caskets instead of full sized caskets
Fractional Display
What is the difference between vaults and liners
Vaults seal; liners do not
The process by which the consumer is informed about the products about to be purchased
Presentation
There should be three constants for the presentation for every family coming into the arrangement room
Consumer receives the information he/she needs
Information given in patient and gentle manner
Try to reduce the family’s apprehension
The method whereby the selection of the casket is made with the funeral director present
Direct Selection room procedure
The method whereby the selection of the casket is made without the funeral director present
Indirect Selection room procedure
A statement signed by the funeral director and the client or representative with copies retained by each party
Statement of Funeral Goods and Services Selected
The Statement of Funeral Goods and Services Selected should be in TRIPLICATE
1 - goes in funeral home record
2 - Family
3 - Accountant
The FTC and other are seeking to require by law a minimum of ___ area on the statement of funeral goods and services selected
7
What are the areas that the FTC requires to be on the statement of funeral goods and services selected
Professional Service Charge Use of Facilities Itemized cost of merchandise Itemized costs of cash advancements Clear and concise terms of payment Itemized costs of rolling stock Consumer clause and rage of merchandise
There should be how many price sheets?
4
What are the 4 different price sheets?
GPL
CPL
OBCPL
Statement of funeral goods and services selected
