Co-op Funeralcare staff use 'tricks' to boost profits after lockdown

Staff at Britain’s biggest funeral provider, Co-op Funeralcare, are using “tricks” to increase the profits it makes from families bereaved in the wake of the coronavirus lockdown, The Telegraph can disclose.

Branches in south London received emails from their boss encouraging them to steer clients toward more expensive funerals and to restrict more affordable options to unpopular times of day to make them less attractive.

The company, which took £300 million in revenues from funerals last year, was said by managers to have high markups on its coffins, which cost “peanuts” to manufacture.

A reporter posing as a trainee funeral arranger witnessed workers mocking corpses in their care, remarking on their obesity, nicknaming one “Stinky” and making derogatory comments about miscarried foetuses and suicide victims.

The revelations appear to fly in the face of the firm’s pledges to arrange funerals with “respect” for the deceased and to “tackle funeral poverty”.

Staff at the south London branches were repeatedly told to increase profits to compensate for the impact of the crisis on the firm. Whilst it drove an increase in funerals, lockdown restrictions on the range of services they could offer and the numbers of guests permitted to attend services limited their ability to make money.

Staff at dozens of branches were told to “promote” the firm’s £3,405 “traditional” funeral over its cheaper option. They were also told to make the basic funeral package less appealing by insisting these take place before 10.30am and within an 11-day time frame.

In one email, Russell Turnbull, a regional manager in charge of 39 south London branches, said: “We are still not quite back to where we were pre-Covid in terms of income per funeral, which is hurting our profitability still.

“This is largely caused by our mix of funerals… please can you promote the benefits of the Traditional funerals over Simple – doing this will cure the problem overnight.”

Staff at one branch boasted of the “little tricks” and “salesy things” they could do to encourage customers to spend more – for example, by not giving them the option to buy flowers elsewhere, or by failing to tell them they had 28 days to pay the full cost of the funeral.

The revelations are likely to come to the attention of the Competition and Markets Authority, which has been investigating the industry to ensure “emotionally vulnerable people” were not getting “a bad deal”.

Last month, in a provisional decision, it called for greater transparency but stopped short of recommending regulating prices because the impact of the pandemic had made it unfeasible.

But MPs said the behaviour exposed by The Telegraph made the need for price regulation “more urgent, irrespective of current circumstances”.

Siobhain McDonagh, the Labour MP for Mitcham and Morden, who has campaigned against funeral poverty, said: “This is such a distressing time for people ordinarily, but with coronavirus on top, [people are] dying prematurely with very little money… there should be urgent action to set up a funeral regulator.”

The Co-op distanced itself from The Telegraph’s findings and disputed the scale of profits on its coffins.

Sam Tyrer, the managing director, said: “We do not recognise the picture of our professional and caring business painted by these allegations. They are unrepresentative of our approach to business, our services for bereaved families and of our people, who are the best trained and most caring in our sector.”

The 'hard sell' awaiting the bereaved

The Co-op is a household name when it comes to funerals, with plaques in branches promising customers that it will handle them with “care, respect, clarity and reassurance”.

It claims to recognise how expensive the process of laying a loved one to rest can be, and commits itself to guiding families towards a funeral they can afford.

But an investigation by this newspaper has raised major question marks over some of those undertakings.

The Telegraph found one senior manager dictating sales practices apparently designed to channel families – many recently bereaved due to the coronavirus – towards its more expensive funeral options, while restricting access to a more affordable package.

The Co-op Funeralcare regional manager, responsible for overseeing 39 branches in south London, was also not averse to encouraging his staff to use hard-sell tactics.

“The two single biggest additional services that affect our financial position as well are limousines and embalming,” Russell Turnbull informed his staff in an email sent earlier this month.

Reaching for the upper case on his keyboard, he added, “When you talk to your families about limos, don’t ask IF they need any, ask HOW MANY THEY REQUIRE.”

The sales tactics outlined in Mr Turnbull’s emails are reflected in the attitudes of some staff, who believe it is acceptable to use “little tricks” in order to help part people from their money more easily.

One manager said it cost the company just “peanuts” to manufacture products, such as the coffins themselves, which it then sells to customers with a big mark-up.

Another manager estimated that the Co-op sells the coffins for 10 times the cost of making them.

An undercover reporter was also faced with some staff showing anything but respect both to the dead and the living. Bodies were ridiculed for being overweight or given the nickname “Stinky” if decomposing.

In the case of miscarried foetuses or suicide victims even worse epithets were used. Then there were customers who were derided by some staff, such as those from the Traveller community who were labelled drug dealers and thieves, to be tolerated only due to the large amounts they spend on their funerals.

Our investigation was conducted in the light of an ongoing inquiry by the government’s consumer watchdog, the Competition and Markets Authority, into overpricing in the funeral industry. A Telegraph reporter worked at Co-op Funeralcare, which is the biggest funeral provider in Britain.

Covid 19 may have had a major impact on the Co-op as a business, but based on the reporter’s experience in south London it also made them surprisingly cavalier when it came to potentially spreading it.

A manager based at one of the Co-op Funeralcare hubs told him: “We are not necessarily the best people at the whole social distancing, we are a little bit huggy and a little bit touchy feely.”

A lawyer for the company later told The Telegraph it was “shocked” to hear that the Co-op’s “clear policies” on protecting its staff may have been flouted.

The manager explained how the lockdown had affected the Co-op.

“As a business, we packed a lot of funerals in and we did an amazing job of keeping as many families going as we could, but because we weren’t doing things like flowers, we weren’t doing limousines, we weren’t doing coffin choices, we weren’t making a huge amount of money. We need to try and reap some of that back.”

What is apparent from many of Mr Turnbull’s emails, replete with performance tables and analysis, is the absence of the word “selling”.

Clearly, given the sensitive industry in which they are operating, efforts have been made to avoid the negative connotations associated with that word.

“We are not asking you to sell anything and never will,” Mr Turnbull wrote in one email last December. But the regional manager, who formerly worked in the used car industry, appears to have simply substituted the word “promote” for “sell” in his emails. One recurring theme was his desire for staff to “promote” the £3,405 Traditional funeral option over the £1,895 Simple one.

“With funerals slowly getting back to normal and having asked you all to promote Traditional funerals over Simple, I have to say a massive well done!” he wrote in August.

“Last week you achieved the 2nd highest level of Traditional funerals in the South [of the UK], a huge achievement and one that has and will affect our profitability in the months to come.”

Celebrating the fact that the average price of a funeral had “shot up” to more than £3,000 – a “massive £485 increase” – Mr Turnbull could not disguise his joy, writing, “I am so proud of you all right now I could burst!”

Michael Pengelly, head of operations for funeralcare, appeared to feel similarly, sending an email in which he thanked staff “for everything you are doing”, adding, “the client choices you are offering are starting to show”.

Laura Allen, divisional operations manager for the south of the UK, agreed. “Great update Russ!” she gushed in an email.

The precise order in which clients were offered those choices was a contentious point. Soon after arriving at the company last year, Mr Turnbull sent staff a step-by-step guide to arranging funerals in which he instructed them to present the most expensive package option of all, the £4,205 Classic funeral, before the Simple or even the Traditional.

The potential consequences for customers was not lost on some staff. One funeral arranger said:

“Considering people are so vulnerable when they come in… they might feel pressured into buying the most expensive.”

The “immoral” policy would mean “we’d be on the front page” for “taking advantage of vulnerable people,” he added.

A lawyer acting for Co-op Funeralcare told The Telegraph that the policy was a “local proposal… rather than a centralised policy” and has since been phased out.

Other staff appeared to be less concerned by using sales tactics.

A funeral director suggested that when it came to including flowers in the funeral package  it was best not to allow even for the possibility of them using a third-party florist.

The funeral director told staff: “You don’t give ‘em an option, you just say – and which sort of flowers would you like me to arrange for you?”

At the height of the pandemic some branches apparently struggled to obtain flowers for clients, prompting staff to recommend other suppliers.

But in May Mr Turnbull sent an email telling staff they would be “forced to take disciplinary action” for even “one single instance” of staff trying to help families by pointing them towards florists direct.

The funeral director had another tip on how to railroad a grieving family.

Instead of making clear that clients only had to pay half the price of the funeral up front, with 28 days to pay the balance, he said: “I don’t usually offer that. I just get, you know, just shall we take it all in one go now, and they go ‘yeah’.”

Asked what it cost the company to produce its coffins, which sell for anything from a few hundred pounds for a “wood effect” one and go up to around £2,990 for a “White Rose” steel casket with velvet interior, the  manager said: “Peanuts.”

“We make a lot of money on coffins,” added the funeral director.

This was reinforced by another manager who said that “as a general rule of thumb” you would “knock off the last digit and that’s probably the cost of the actual coffin to us.” If accurate that would amount to a ten-fold mark-up.

A lawyer acting for Co-op Funeralcare told The Telegraph that the figures on coffins costs were “significantly inaccurate” but declined to explain further.

While black humour is an inevitable part of the job, our reporter found that sometimes this overstepped the mark by ridiculing the dead or showing outright contempt for customers.

Watching one large body being prepared for cremation in his back office, the funeral director remarked on the gentleman’s overweight appearance, laughing that he would have been too big to get in his clothes.

“Looking at the size of him I don’t know how he ever got into his pants but he’s not going to get in them now. They’re only large and he needs extra-large.”

The reporter was told that Traveller families were an issue.

“There’ll be a lot of snotty children,” said the manager. “Yeah, trying to nick the hub caps off your car and all that sort of stuff,” said the funeral director.

“The branch will stink of fake tan and cheap perfume,” said the manager, adding, “but they spend loads of money so it’s fine.”

Furthermore, it was always in cash. Why cash, she was asked? “Nobody pays for cocaine on credit cards do they?” she laughed, implying they earned their money dealing drugs.

Sam Tyrer, Co-op Funeralcare managing director, said: ‘We do not recognise the picture of our professional and caring business painted by these allegations.

“They are unrepresentative of our approach to business, our services for bereaved families and of our people, who are the best trained and most caring in our sector.

“We are conducting a thorough investigation in south London and will take all necessary measures once this is complete. We will not tolerate any individual actions that undermine the professionalism and commitment shown by our colleagues to the bereaved on a daily basis.

“If in any instance we have fallen short of the high standards to which we hold ourselves nationally, we apologise unreservedly to those affected.”