A Locally Owned Business Provides Strength for Fairmont
Despite steady paychecks, good benefits and sometimes lavish perks, Corporate America continues to lose key employees www.j-hokkaido.com willing to gamble their security and bet on themselves.
While these defections usually come from the ranks of giants like IBM or Pillsbury, smaller corporations and rural America aren’t immune to the sudden departure of employees who tire of their corporate culture.
It even happens in small towns like Fairmont, where late in 1997, Dennis Boro and Daron Johnson parted company with Olson Funeral Home, one of 162 funeral homes owned by Prime Succession, Inc. of Cincinnati, OH. Olson, founded in 1936, was sold to Prime in 1992. In 1995 Prime Succession was sold again, this time to the venture capitalist Blackstone Group in New York. The Loewen Group, a funeral home consolidator based in Canada, holds a 21.8 percent interest in Prime Succession.
Boro, who became a funeral director at Olson in 1974 when it was a family-owned business, simply changed careers. He’s now Director of Business Development at Bank Midwest in Fairmont, which has four other banks in northern Iowa and southern Minnesota.
Johnson, a funeral director at Olson since 1992, left at the same time, but decided to compete with his former employer. “There were some sleepless nights when we were putting this together,” he said.
What Johnson put together was the conversion of a former church building, just down the street from Olson, into Lakeview Funeral Home, which opened in January of 1998. His partner happens to be Maureen Boro, wife of Dennis. She stepped into the funeral business about the same time her husband stepped out. Maureen, who has a degree in therapeutic recreation from Minnesota State University, Mankato, resigned as recreation director of the Lutheran Retirement Home in Truman to serve as Lakeview’s office manager. Johnson and Deb Gerdts, who’s lived in Fairmont for a dozen years and worked briefly for Olson, are Lakeview’s licensed funeral directors.
A non-compete contract with Prime Succession restricts any participation by Dennis Boro, but there’s widespread speculation in Fairmont that he’ll join Lakeview when the contract expires in 2000. It’s a “forbidden subject,” according to Johnson and Maureen, who turns aside the speculation by saying her husband “really enjoys the banking business.” Nonetheless, provisions of the non-compete document block Dennis Boro from even advising his wife or Johnson on the fledgling enterprise.
Olson, the only funeral home in town since 1979, “had a wonderful reputation for many, many years,” Maureen said, and the partners realized this magnified their challenge. “We faced not only a huge financial risk, but the risk of not having public support,” she said.
Despite the legal complications and the uncertainties associated with any new venture Maureen said she and Johnson formed a partnership and bought the former Assembly of God Church because “we felt there was a need for a locally owned funeral home in town.” The availability of the quaint, Colonial-style brick church, which faces Ward Park and Lake Sisseton, “made the decision a lot easier,” Johnson said. It was originally built as a Christian Science Reading Room 60 years ago and its tall circular spire is a familiar landmark along the lake. “This building was the piece of the puzzle that made it all fit, made it easier to leave our jobs, because we knew we had a beautiful facility.” Johnson said. Both recognized the building’s potential as a mortuary. With only minor changes, for example, the former sanctuary became both a visitation room and a beautiful chapel for services.
The building required minimal remodeling, and the interior was completely repainted and recarpeted. Although operating on a limited budget, the partners resisted temptations to “cut corners on the project because we knew we had to have a top-notch facility right off the bat,” Johnson said. Even the doorknobs and brass trim were removed and polished by a local restorer, Jim Stockdill of Whistle Stop Antiques.
“When word got out that a new funeral home was opening, people stopped in right in the middle of the remodeling, just to see what was happening and to express their support,” Johnson said. “The positive feedback started pouring in. They were so happy to have a choice of funeral homes.”
A regional advertising agency based in Fairmont, Sauck & Brown, developed a logo for the new funeral home, using a butterfly to symbolize life cycles. The partners placed small announcement ads in the Sentinel of Fairmont, the Fairmont Photo Press and the Truman Tribune. Later they turned to the agency for help in preparing small-space advertising on various themes they felt were important, such as compassion, trust and community. Lakeview also sponsors local programming on cable TV. But there has been no media “blitz” to publicize Lakeview, no full-page ads in color that a new retail business of this scope might be expected to run. Even the ad announcing Lakeview’s open house was only a quarter of a page. But more than 800 people attended the one-day event. “They were lined up on the sidewalk, all the way out to the street,” Maureen said.
Lakeview officially opened Jan. 21, 1998, with the partners hoping to conduct 60 funerals during its first year. Their first death call came 10 days later on Feb. 1, followed by another Feb. 2. “We had 15 funerals in our first month,” Johnson said. That month was a good indicator, because by year’s end they’d conducted 122 funerals, more than twice their original projection. Most of the families served were from Fairmont, but some came from the nearby towns of Truman, Ceylon, Granada and East Chain.
Were they surprised by Lakeview’s rapid acceptance?
“Yes, but fatigued would be a better word,” said Johnson, who lost 20 pounds that first month, working from 6:00 A.M. one morning to 2:00 A.M. the next, seven days a week. “We were either working or sleeping and there wasn’t a lot of sleep involved.” By the third week of February, Maureen was working at the funeral home seven days a week too. She’d planned to keep her seasonal part-time job with a Fairmont CPA firm, but the pace at Lakeview made that impossible.
She believes there are four ingredients in Lakeview’s success. “The timing was right, our facility is beautiful, we have community support and an exceptional staff. I really believe one of the biggest reasons for our success is our staff, because they’re all caring, local people. They’ve lived here a long time and they’re trusted by the community,” she said. Besides Gerdts as a funeral director, the employees include Carolyn Seidel in the office and three retirees, John Bisbee, Jim Olinger and Tom Sherry, who handle part-time assignments ranging from driving to ushering. Bisbee was a Fairmont policeman, Olinger worked at Fairmont Railway Motors and Sherry farmed near East Chain.
Maureen regards timing as an ingredient “because about the time we were starting this, 60 Minutes aired a report on corporate funeral homes and it wasn’t very positive. We think a lot of people watched it on TV. I think that had an impact.”
Now, with their first year behind them, Johnson feels “relieved because of the doubt you have in starting a new business. Now I feel terrific.” Maureen feels “very thankful and grateful that we have the support of the community, that families are coming to us and that we’re doing what we wanted to do. We just want to do our best serving the families who come to us. We’re in tune with what we must do to stay above water, but our primary goal is to have the families we serve be satisfied beyond their expectations.”
Both believe Lakeview can operate with greater flexibility and be a better community asset because it’s a locally-owned entity. “Our funeral home is supported by the people in this community and that means the funeral home should support the community in turn by buying our insurance locally, by banking locally and by buying our vehicles locally,” Johnson said. “We don’t have to follow regimented corporate standards and we can make our own decisions on how to handle things. We can run this by feedback from the community.”
The partners will have plenty of opportunities to test their flexibility and decision-making abilities in the near future. They’ve just added a triple garage and identified four other short-term capital improvements including more parking, a second visitation room, expanded office space and a handicapped restroom.
“We started with just one visitation room for families, which was OK if we were serving 60 families a year,” Maureen said. “But now we really need a second.” They’re hiring an architect to help plan that addition, and they’ve purchased a large lot behind Lakeview to create 30 more parking spaces after a house is moved off it this fall. Right now, Lakeview has off-street parking for just 13 vehicles, although there is ample parking on streets adjoining the facility.
Although her husband and Johnson wanted to abandon their corporate environment, neither wanted to leave Fairmont. “I love the people more than anything,” Johnson said. “People are what make a community, not necessarily the surrounding, but the lakes sure help.” (Fairmonters enjoy five lakes within their city limits.) Johnson is a native of Estherville, Iowa, about 45 minutes from Fairmont. He studied biology at South Dakota State University, Brookings, and graduated from Worsham College of Mortuary Science, Chicago, in 1992.
“There are 35 active morticians around the U.S. who are from Estherville,” Johnson said. “The people who run the Henry-Olson-Furhman Funeral Home in Estherville are good role models. They’re very active in the community and people kind of looked up to them.”
Maureen grew up in Beatrice, NE, a town just slightly larger than Fairmont. “I like the size of Fairmont. It’s a nice size to raise a family. There’s the lakes, the golf courses, the Fairmont Opera House…and so many stimulating people live here,” she said.
©1997 Connect Business Magazine