And so those conversations that the director of support, regional partners and our FBNA team here at the Houston Sports Center are having are bringing significant awareness and understanding of how pricing matters and how we cannot absorb increases coming from inflation or merchandise costs or whatever it is from our vendors and others. And so it’s making a significant impact. Nothing other than awareness through a very specific pricing review process. However, we do lead the final decision to the MP because it is very sensitive, right? We do not want to price ourselves out of the market. And so we listen to what they say, how they’re thinking about their business, how, what is their value proposition, which is something all of them are working on and defining what it is that this funeral makes it different than others from a value perception perspective.
And it is making a significant impact. So that’s on your number one question. And the number two, I do believe that for 2024, we will be right in the middle of a single digits for year over year increase on our average revenue per contract. Maybe a little bit higher on the cremation side because we have a very specific approach to cremation, maybe between seven to 8% on the cremation side. And the approach to cremation is very simple. When you think about our burial mix and cremation mix of carriage, we have about 70% cremation. Of that 70% cremation, 69%, almost 70% too, is direct cremation. Direct cremation being the lowest average per contract that we have. And so our focus is going to be on that direct cremation volume and see how many families can we convert to what we call cremation offerings.
We have created a very specific strategy to educate families with literature and offerings that include, you know, a direct cremation with a service reclamation without, you know, a pool visitation or ID or merchandise, different approaches customized by business through the support of the managing partner. And we believe this will lead to a significant increase on conversion ratio between cremation with something sort of service. And so we’re very excited about that. This has started officially in the month of January, and we believe we will see the benefits of that as we report in Q1.
Operator: Thank you, George. And this concludes today’s question and the answer session. I’ll now turn the floor back to Carlos Quezada for any additional or closing remarks.
Carlos Quezada: Thank you everybody for attending the call today. We’re super excited about the future at Carriage. Our ability to now manage pricing power, our continuous improvement program, our program on customer experience and being able to gain market share and better pricing from perceived value from families is very, very exciting. Our brand new purpose statement as the driver and the three supporting pillars under the purpose statement, it drives a focus and a way to continue to grow over the next years and provide shareholder value. We’re very excited also about our focus on continue to pay down our debt and really deliver on our promise we made to our high performance, great profile restoration plan to deliver on the leverage ratio that it is ideal for Carriage.
In closing, I would like to say something regarding Mel Payne. Mel’s retirement marks the culmination of over 33 years of exceptional leadership since founding Carriage Services. A journey categorized by visionary foresight, a steadfast commitment to being the best and a heartfelt dedication to this noble profession. Under Mel’s guidance, the company has become one of the industry leaders, setting high performance standards and fostering a culture of honesty, integrity and quality in all we do. This transition to retirement signifies not an end, but the onset of a new chapter for Mel to explore. The legacy left behind is a testament to a career dedicated to excellence, inspiring those who follow to continue building on this foundation. As Mel steps into the next chapter, the hope is for it to be filled with joy, peace and fulfillment, reflecting the richly deserved rewards of our remarkable career.
With that, we thank you and we’re happy to report our Q1 results as we continue to grow in 2024. Thank you.
Operator: This concludes today’s webcast. We thank you for your participation. You may now disconnect your lines at this time.
