This Tuesday the Midwest Entrepreneur class went on what is hoped to be but the first of several field trips this semester to the actual businesses of local entrepreneurs.
This field trip, to the McGuire & Davies Funeral Home and Crematory in Monmouth (see: http://www.mcguireanddaviesfuneralhome.com/) , was a very special field trip.
Our gracious host, Mr. Al McGuire, had been our very first guest speaker in Spring 2013; last January 29 to be exact. Al came to the class then with little but an architect’s rendering of the facility, a piece of empty land near the northwest end of town, and a grand entrepreneurial dream to be the most modern and service-obsessed funeral home—and the only crematory—in the Monmouth area.
How things have change in the last year…
Ground was broken in April of 2013 for the new facility. The grand opening took place on October 18. More than a million dollars was invested by McGuire and his partner Trevor Davies. In the latter months of 2013, the two fledgling entrepreneurs received 39 calls for funeral services and performed 40 cremations. So far this year, they have performed 7 services; all involving use of the facility’s crematorium.
Several of the funerals handled since opening the facility were very large and truly tested the mettle of the McGuire and Davies team. As Al told the class—sitting attentively in the beautiful parlor of the new facility—these particular services were both (1) great opportunities to show what they can do—and generate positive word-of-mouth in the community—and (2) opportunities to, as he put it, “crash and burn.” Well, there was no “crash and burn.”
You see, while the two entrepreneurs are new to running their own business, neither is close to new to the funeral business.
Al McGuire possesses 30 years of experience as a funeral director. His work in the industry can be traced all the way back to his undergraduate days at Loras College in Dubuque, IA, where he lived above a funeral home and worked—to pay for school—for two years in the early-mid 1980s. Immediately prior to starting his own business, McGuire had worked at Monmouth’s Hoover-Hall Memorial Chapel for many years. Trevor Davies, although 20 years the junior of his partner, also possessed a wealth of industry experience entering into their current venture; having (1) graduated from the Worsham College of Mortuary Science in Wheeling, IL, (2) served an apprenticeship with the Davenport Family Funeral Home and Crematory in Barrington & Crystal Lake, Illinois, and (3) worked for 5 years at the Turnbull Funeral Home here in Monmouth.
So, what we have here—on the surface at least—is two highly ambitious people with extensive industry experience who, at some point, decided to “go it on their own,” be their own bosses, and compete against their former employers.
But there is far more to the ongoing, early-stage entrepreneurial story of the McGuire & Davies Funeral Home and Crematory.
You see, during their respective years of working in the local funeral home industry, each gained not only knowledge of the trade but, just as importantly, connections to people in the local community and, arguably most importantly of all, strong reputations as professional service providers who listen to and care about their customers. This is, of course, particularly important in the funeral services industry.
This, too, is about something I stress in virtually all classes I teach here at Monmouth College; something called relationship marketing.
Relationship marketers are concerned first and foremost about customer satisfaction. Customer satisfaction, achieved repeatedly over time, leads to repeat business and the spread of positive word-of-mouth-communication and referrals. Further, repeated satisfaction leads, eventually, to high levels of customer loyalty; something all marketers should strive for.
After hearing Al McGuire talk proudly about his new business Tuesday, I can firmly attest to the fact that the McGuire & Davies Funeral Home and Crematory is indeed a relationship marketer committed to continual customer satisfaction.
But do not make the mistake of thinking that it has been easy for the two entrepreneurs…
McGuire and Davies have taken extraordinary risks in starting up their entrepreneurial venture. As stated earlier, McGuire informed the class that he and his partner had invested more than $1 million dollars into the business. This in and of itself is worthy of the label “extraordinary risk.” But there is far more to consider here.
As Mr. McGuire told the class, both he and Davies have put “everything they have on the line” into this business. As Al stated during our visit: “… about the only thing I didn’t have to do was give away my children.” Yet he is confident that the right risks are being taken and that all external debt—incurred only at local banks—will be paid off in approximately 10 years (even though the loans are for 20 years).
And a note on the investment into the physical facility itself… Clearly—and I say this as a result of the class having been treated to a complete tour of the facility—McGuire and Davies have gone well above and beyond what most would think “necessary to compete” with the building. However, as Al informed us, there are two key reasons the level of investment made.
First, given that his is now one of three funeral homes in a small market, McGuire expressed his belief that he must go the proverbial extra mile to stand out in the marketplace (particularly considering the fact that he is competing against two deeply entrenched, long-time providers of funeral services in the Monmouth area).
Second, the large investment was strategically made so as to make the new business stand out in ways allowing it to both (1) position itself on the basis of unique and increasingly meaningful benefits, and (2) create and maintain a sustainable competitive advantage. Most notably here, the new facility incorporates the latest technological advances to allow the playing of customer-chosen music and DVD compilations celebrating the life of the deceased loved one; part of an ongoing memorialization trend in the United States toward mourning in celebratory, technology-facilitated fashion. Further, the addition of the crematorium—a nearly $90,000 investment on its own—allows the business to generate income above and beyond the funeral services it personally performs; as it is the crematory in the area. And as Mr. McGuire clearly noted, the investment in the crematorium is particularly warranted given the fact that more and more people are opting for lower-cost cremations, a trend likely to continue and intensify in coming years. What we have here is adaptation to emergent customer-driven change in the marketplace… According to McGuire: “Change has occurred… you must change or be left behind.”
Actually, as someone trained extensively in services marketing—and how services must be marketed differently than goods products—I see the investment in the building itself—what services marketing scholars would call a “tangible” within the overall product offering—as an investment in service capabilities.
Specifically, having the most modern and service-oriented funeral home—and the only crematory—in the Monmouth area allows McGuire and Davies to do more for those in need of funeral service than anyone else in the area. And that is just what the two early-stage entrepreneurs are doing.
Doing what competitors can do better and also providing highly valued and increasingly demanded services that the competition cannot…
That is a sound entrepreneurial business model!!
Thank you Mr. McGuire for allowing us special, intimate insight into your business!! And thank you as well to Claire McGuire—Al’s daughter and a member of the Midwest Entrepreneurs class—for arranging the field trip.
Student comments to this blog—or other comments regarding Mr. McGuire’s presentation—are welcome.
See you again soon.
Regards,
Prof. Gabel
