The two biggest providers in the deathcare industry are Service Corp. International (SCI) and Stewart Enterprises. SCI has about $2 billion in annual revenue and is the largest cemetery and funeral company in the world. Most of its operations are domestic. The turnover in the lower tiers of the companies is enormous, especially with their salespeople ("family service counselors"). They are paid a pitiful sum and much is demanded of them. Often their working conditions are pitiful. The kitchens on the premises are old and dirty and sometimes infested with vermin. They are expected to work 7 days a week and nights. Stewarts salespeople are actually independent contractors and are not paid a salary. They are paid 100% straight commission (draw against commission). SCI's salespeople are employees and are paid $8.00/hour, barely above the minimum wage. The corporate benefits are good but expensive and many lower tier employees, salespeople and administrative staff, cannot afford the benefits. If salespeople do not meet some pretty high sales minimums they are fired. Managers are not though!
When a death occurs you probably have no idea that the people you meet with at the cemetery are paid via commission. You are grieving and they are trying to figure out how to maximize sales/commissions for themselves and their companies. The markups on the range of products they sell are enormous, 300-400% and up. SCI and Stewart demand that their employees do "after-care visits" in the survivors homes within 3 days of burial. These are actually and simply sales calls. Corporate semantics disagree with this, but if you look at special file folders counselors put together for each family they deal with, under "after-care visits" the only line items in these folders are dollar amounts and sales achieved. The companies want to strike while the iron is hot, and they want counselors to get referrals, referrals, referrals. If a cemetery or funeral home person told me they were going to visit me in my home after my father was buried I probably would have hit them. These visits are supposed to be arranged when the family comes to the cemetery to make arrangements right after death occurs! Rather callous and not very sensitive at all to the family's grief.
Deathcare management is a different matter. They can be extremely well compensated. There are too many layers of well-paid and lazy management, mostly sales managers. A simple sales manager at an SCI location makes about $45,000/year minimum. If he/she hits certain sales targets they can make in total much much more, up to about $120,000/year. And often they do not work weekends and evenings. While family service counselors are very lucky to earn $45,000 if they are very good at what they do. The corporate mantra is that the more salespeople the merrier. While these cumulative sales can boost a managers commissions, they can water down what the average salesperson/counselor makes. The million dollar question is does a cemetery have a certain natural sales level due to annual burials or can salespeople really drive new buyers and higher sales and higher burial rates to any given cemetery?
And then management is paid very well. At Stewart higher level sales managers all seemed to like to drive Mercedes and nice, big BMWs. Many management types receive very generous stock options. Lower lever employees do not. At SCI many many managers received low cost stock options (exercise prices of $2-$4) 7 to eight years ago roughly. The problem with options is that they typically expire at some point in time, usually about after 5 years. For these lucky SCI managers the SCI stock price got up into the low teens around expiration. So what did these corporate types do? They took the money and ran. Rather than exercise the options and buy and hold the underlying stok, they exercised the options and sold the stock simultaneously, thereby receiving tens of thousand, hundreds of thousands, and millions of dollars in windfall cash proceeds. And then when SCI stock went down to low single digits in the bad economy of these last few years, the neanderthal board of directors at SCI granted all of these same and already well compensated managers a new round of options with low exercise prices! How is that not criminal. The stock has come back due to the general market doing better recently and not because of any smart management by SCI's management. Watch and see. If they're not doing so already probably they will start taking the money and running again! Why is this corporate self-enrichment legal? When the stock went down in these last few years did management give back their option gains from the last go around. NO. Why and how are these people not ashamed and embarrassed? Why are they not in jail?
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