The Good Funeral Guide Blog

Dignity marches on

Thursday, 6 March 2014

Dignity

 

The Times has reported Dignity plc’s results here(£). Briefly:

Pre-tax profits are up 15 per cent to £52.9 million.

Prepaid funerals contributed £6.7 million of this.

The bonus pool is £2.5 million and all fulltime staff have been given ‘a payout equivalent to’ £1000.

Final shareholder dividend of 11.83p a share, an increase of 10 per cent on last year.

Market share now 12 per cent.

68,000 funerals conducted last year, up from 63,200 in 2012

In the last year, 40 funeral homes and 2 crematoria acquired.

Share price rose 13p yesterday afternoon to £15. City slickers well pleased.

Dignity’s position is, of course, vulnerable to consumer awareness of its relatively expensive  funerals and its relationship with Age UK; and to disruptive intervention in the crematoria market on the US crematory model.

Over to you, Mr Plume.

10 comments on “Dignity marches on

  1. andrew plume

    Wednesday 26th March 2014 at 9:07 am

    Dignity Plc are delighted to announce these figures. After forking out £58M on a fairly recent acquisition (plus further improvements to be made (as part of that deal)) an announcement in any other terms would look a touch disappointing

    When I look at “rah rah rah statements such as this” my sole concern is for the likes of Mrs Sylvia Smith of 1 Acacia Avenue, now faced with the expected death of her husband. She ends up being supremely overcharged in what is little other than ‘a fairly bog standard cremation’. She has no idea where her hard acquired cash ends up and what ‘it contributes towards’ within the vast Dignity network. As I’ve said before, non-worldly wise punters shouldn’t have to contribute towards losses and future expansions etc but they surely are. Dignity are no different than any of their Corporate/Mutual competitors AND this significant level of ‘over charging’ is pretty well my main objection to the ‘Corporate Funeral module’. Such ‘over charging’ at this sad time, sees way too many punters exploited. This is exactly why there should be concern…..Dignity by significantly ramping up their prices, means that there’s plenty of scope for ‘the other Corporates’ to increase theirs too…………………

    Within the ‘pure funeral conducting side’ are these figures really anything to get excited about? No, imo, not particularly. The headline statement is a little economical with the proverbial. The Yew/Warburton Group acquisition skews the figures. Dignity paid a large amount to include that business last year, a very large amount……….Under the heading of ‘feeding time’ (last year) (http://www.goodfuneralguide.co.uk/2013/01/feeding-time/) much was said regarding this acquisition, there were some really sound comments on this too. I chipped in and said “…For the last fin year, this part of Yew carried out 6,197 funerals…” Now there will always be a fall out from a large acquisition BUT during their first year under the Dignity ‘umbrella’, funerals arranged from the former Yew offices were down to 5500 (approx). That’s a drop of 11% – is this likely to be an onward trend….? Did Dignity pay too much for this business? – if so, those at the grass roots end of paying for a funeral will (again) end up chipping in……

    We are told that “……As at 27 December 2013, the Group operated a network of 690 (2012: 636) funeral locations….” Of course, in ‘Corporate accounting terms’ one never gets to hear of the really really under performing branches, you know those that do one or two funerals a week, at best………, often less. What’s the logical point in keeping them? A run through Dignity’s index list came up with at least 80 locations (and possibly far more) which I’m fairly sure are either running at a loss or at a scant profit. Dignity’s charges have to be at such a level to prop up these branches – why should your average punter have to contribute towards that……? That’s at least 10% of their network………

    I’ve always felt that the ‘Corporate Funeral module’ is seriously flawed. It’s partly based on these general assumptions:- (1) a punter will often instruct a ‘named business’ which they have had past involvement (irrespective of change(s) of ownership); (2) there is a degree ‘of safety’ in that choice; (3) your average UK punter would definitely prefer not to shop around for quotes; and (4) if a firm/business is already holding the body, well then it’s a done deal. Corporates are well wise to all of this plus your average punter (on the whole) wants to get the arrangements done and dusted pdq and what with the grief element, time spent in shopping around is an unnecessary diversion. After all as far as the largely unaware are concerned “…..all funerals cost the same……” The British sense of being reserved prevents much in the way of asking around and spending time on comparisons etc. The Corporates will be only too aware of this, past attitudes, much unawareness etc etc, are all contributing in your average punter beating the path to their door

    …………and finally, to keep the Institutional shareholders on side, there’s only one way to go, namely increasing profits and to achieve that, prices have to annually increase, simples really………………

    andrew

  2. Wednesday 12th March 2014 at 1:30 pm

    Andrew, your advert is commendable – honest, up front, down to earth communication.

    We’ve just moved in to an area where the only other local FD is a member of the co-op…not that anything about their external appearance or advertising in local media would tell you that.
    One of our team recently spoke to a member of public who hadn’t realised the other company were co-op until they went in there and got handed some of their literature, at which point they left, having wanted to use an independent in the first place. I wonder how many families have fallen foul of this lacking in transparency approach and end up just sticking with them it because it’s easier than going to find an independent.

    To Fran, I don’t think any of us in this profession working with empathy and heartfelt desire to help will end up rich! I couldn’t sleep at night charging that much for a straightforward, simple cremation service!

  3. Monday 10th March 2014 at 8:44 pm

    I have in front of me an estimate dated last week from a Dignity owned local business: £1,450 for ‘Arranging and Conducting the Funeral’ (a cremation at a Dignity owned crematorium) and £800 for ‘Caring for the Deceased Person’.

    Together with the use of a hearse at £495, a bamboo coffin at £755, ‘Embalming Services’ included as a matter of course (without any discussion or asking whether the family wanted this) and £78 for an ashes casket and Dignity’s fee for this one funeral totals £3,669.00, before the cremation costs.

    Grand total for a straightforward cremation £4,843.00

    The hub that we collected the body from after the family changed their minds deals with 40 bodies a day.

    Dignity has an awful lot of hubs.

    If every independent FD out there with a bit of nous went public with their prices and comparison prices with the local corporate, perhaps the public might wake up to the fleecing that is going on day in day out to provide that £52,900 000 profit

    PS To ‘arrange and conduct the funeral’ and ‘care for the deceased’ – what did we charge?

    £250. Just the two thousand pounds less than Dignity’s costs. We’ll probably never be rich like them.

    • Monday 10th March 2014 at 10:46 pm

      You’ll make a living. Nothing wrong with that.

      The bigger point: it is high time, as you say, that good independents put the interests of bereaved people first and helped them avoid the Co-ops and the Dignitys and the other rip-off merchants. Publish price comparison tables – as Richard Ward does: http://www.rwfs.co.uk/prices.php It’s not aggressive to do this, it’s assertive. A well-kept secret is no damn good to anybody. PROCLAIM YOURSELVES!!

    • GMT

      Tuesday 11th March 2014 at 10:06 am

      Good morning Fran,
      That is a estimate and a half to say the least, nearly £5,000 for a Cremation what is the world coming too if decent people are prepared to pay that amount.
      You mentioned Independents putting prices in adverts, I do this in all my adverts and out of 9 Funeral Directors I am the only one to do it,
      Dignity and the Coop will not follow as they cant match my price but i am surprised none of the other Independents do not have a price on……
      I did have a leaflet drop last year giving a like for like comparison between myself,the Coop and Dignity, at the start I had 3,000 printed then it became popular and I had another 10,0000 printed and distributed,
      never heard anything from Dignity but the Coop reacted with a solicitors letter asking me to explain myself and my price structure, the letter also mentioned a outstanding bill the Coop had with me, Following a family not being happy after using the Coop, the family had started the arrangement but problems were getting more frequent and the family contacted me, I collected the deceased from the Coop chapel and done the funeral,
      Coop invoiced me for the removal and chapel care at £400 after 6 letters back and forward from the Coop my patience had run dry and I invoiced them for nuisance letters and wasting my time, i had previously advised the Coop my intention to Invoice them for £80.00 per letter previously sent if the matter was not dropped, The letter following my leaflet drop also confirmed no further action was to be taken on the understanding my Invoice for £520 would be void.
      I did get my like for like pricing from the Coop website, but soon after I received the letter the price was removed..

    • andrew plume

      Tuesday 11th March 2014 at 8:49 pm

      Fran, Hi

      no mean estimate to put it mildly. I’m very au fait with ‘Dignity Accounting speak’ having seen this on numerous past instances. £2,250 gets you, the removal fee, the staff costs involved in effecting the arrangements and very little else. Assuming removal was from a local Hospital and that it was ‘a natural death’ there is as you know very little involved, just a few forms, some telephone calls, simply another ‘mechanical production line cremation’. As I’ve said on here before, there’s an awfully large mark up in removals and the big boys really exploit this. A standard Vito Van can collect six at least at once from the same Hospital, that’s “real economies of scale”, which of course are never passed on. After a contribution towards the running costs of the local hub, the profit is vast and for very little time involved. Of course, the coff and the vehicles are charged on top…………………..

      ‘fleecing’ the public is no small underestimate. I definitely agree, far more Ind Funeral Directors (than those that already do so) should spend more time in setting out the cost benefit(s) of using them rather than Dignity, F’care, other Cooperative Societies, LM and Funeral Partners. The last two seem to be particularly secretive, the NAFD will not help, so it’s up to the privately owned businesses to emphasise all of this

      regards

      andrew

  4. Monday 10th March 2014 at 2:21 pm

    Spurred on by Dignity’s tremendous efforts, we have put this in our local paper this week http://stneotsfuneraldirectors.co.uk/wp-content/uploads/2014/03/Hunts-Post-full-page-advert-MARCH.pdf

    • andrew plume

      Tuesday 11th March 2014 at 8:56 pm

      Hi Andrew

      why not expand your area to include Ely, there’s another fairly recently acquired Dignity business there as you know – why they need two shops…..? in the same small town with the same trading name, seems to be over egging the cake but it’s surely to prevent a ‘new start up’

      regards

      andrew

  5. Sunday 9th March 2014 at 11:17 pm

    They’re a sitting duck for any firm that markets itself halfway competently and lets consumers know just how expensive they are. They are dream competitors. Give em both barrels!

  6. Sunday 9th March 2014 at 9:29 pm

    We independent funeral directors should be thanking Dignity profusely for another brilliant year! Congrats and trebles all round.

    Prices are up again, Dignity firms near me are quoting over £3,000 as a minimum start price for their service, plus the disbursements of course.

    Brilliant Dignity – they lead the way – surely we little people must follow along behind them? A 15% increase in profits year on year would be most welcome in this still challenging economy.

    I will now remove my tongue from cheek..

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