We interviewed president and CEO of Johnson Consulting Group, Jake Johnson. Here is what he had to say regarding current trends and good goals for 2021. Jake also gave his thoughts on what type of market we are in in terms of buying and selling a funeral home or cemetery business.
Q: What trends are you seeing based on the pandemic?
A: Regarding the pandemic, it has effects on the business from two sides: the customer service side and the business side. As we know, COVID-19 has placed restrictions on the way loved one’s can celebrate the memory of someone who has passed. I think these restrictions—once lifted—will increase the significance of the funeral’s afterward. But, it’s important not to overstate this. When we think about percentages of the population, right now, a very small percentage of the US population has been to a funeral during the restrictions. So, if those are lifted, for all those people, it’s always been business as usual. As we know, many clients only visit a funeral home once or twice in a lifetime. It’s not the same relationship model as other businesses that depend on frequent visits. For all those customers who are having funerals now, it’s important that we help them feel that we did all we could within the restrictions to help them celebrate their loved one, to mourn their passing.
Q: How do these trends fit into goals for 2021?
A: From the business side, it’s taught us the importance, more than ever, of having a strategic plan. You have to look at your business from every angle, from business practices, financials, workplace morale, customer service, to make sure you’re prepared for fluctuations. You have to build a working budget and be able to adjust as the needle moves. You need to build a strong budget for 2021, based on what 2020 has looked like. You have to be prepared to review financials monthly, and to watch the market, to know what the government is doing, how is the jobless rate, so that we can respond to customer needs with what we offer.
Q: How is it a seller’s market and how is it a buyer’s market?
A: Regarding whether it’s a seller’s or a buyer’s market, it’s both. Here’s what we mean. There are investors out there looking to diversify in the funeral industry. So, it’s a seller’s market if you have your financials in order to show the investor that your business is a smart investment. If you have a succession plan in place and you know how to treat your employees, you’ll sell even better.
For the buyer’s the opportunities come from the people, maybe those who are over 55, who don’t want to deal with COVID-19 lingering around or with something similar, and they just want to sell. This is an especially good opportunity when the seller is unprepared. They don’t have clean and orderly financials. They don’t have everything in order, so they have to sell for less. As a buyer, you’re in a good place when you have options, many businesses to chose from, and there are plenty of businesses for sale right now.
If you are thinking of buying a business, creating your exit strategy, or taking your business to market contact our experts at Johnson Consulting Group.