X-Message-Number: 13878
Date: Fri, 09 Jun 2000 21:26:28 -0500
From: david pizer <>
Subject: Reply and new ideas for growth
For over 10 years I worked as a volunteer at Alcor on and off, some part
time and some full time. I was a Director, I was the Chief Financial
Officer, and I was the Vice President. This doesn't mean I am the ultimate
authority, but I mention this so that the reader can realize that I spent
time talking with members and prospective members and prospective patients.
I came to know the reasons why they did and did not join. I was with
Alcor when we had good growth rates and after I left they fell off. I can
tell you that people don't always state their real reasons up front for not
joining. But if you deal with prospects a lot you get a sense of what is
going on in their minds.
When it came to doing "last minute" suspension, I came to the conclusion
that the high price was the number one reason we lost the potential patient.
If you accept my prediction that the future in cryonics is going to be
mostly "last minute" cases that will be presented to Alcor (as it has
been). And that Alcor has *not* positioned itself to handle these in an
affordable and comfortable way. You will see that Alcor is going to
continue to miss most of the suspensions. This is bad for Alcor and this
is very bad for the people who do not get suspendesd. These people may
turn out to be a friend or relative of yours!
What makes this all so bad in my opinion is -- There is no valid reason for
Alcor's prices to be so high.
********* I could not say this if it were not true. ************
If what I was saying was not true, anyone at Alcor that disputes me could
pull out the figures and present them to this forum and the figures would
show that I was wrong. But I do not think that anyone at Alcor is going to
present those details. Not because there is anyone dishonest at Alcor, but
because the philosphy in deciding how much of each Alcor worker's salary
(all the Alcor workers have to wear so many hats) to charge to a suspension
is up for debate so that it is hard to come up with a policy that all will
agree is fair. It is also hard to come up with an "average" cost of
supplies because each suspension develops differently. The philosophy used
to determine how much of each item in long term storage should be charged
for (the percentage) is up for debate. And I do not think that Alcor can
defend the present philosophy it uses to set its present prices. As the
loyal opposition in this matter, I respectfully challange Alcor to present
all its figures (not just for storage but for all phases of preparation)
and then debate these figures and its philosophy.
The *only* reason why I would do this is my sincere belief that lower
prices will be *better* for Alcor (and the additional people Alcor will
then save). Lower and more fairer prices will generate more money for
Alcor. Recently I attended a board meeting and some board members and
officers were worried that they may have to cut services because they felt
they may run short of operating money.
These figures have not been looked at since 1993. At that time there was a
policy made. But the philosophy used in that policy is not one of good
business practices. If *you* read it I guarantee you will not be
comfortable with it.
People tell Alcor everyday that the price is too high. I think sometimes
Alcor just does not hear.
Mike Donahue wrote:
snip
>Greeting, friends, I've been lurking on your newsgroup for some time now...
>I've known many cryonics members of Alcor, but have never signed up due to
>the cost involved.
snip
Kennita Watson wrote:
snip
>I agree wholeheartedly with David here. Alcor may be non-profit,
>but that doesn't free them from the realities of the market.
> How many Alcor principals have backgrounds in marketing?
At the time the suspension Pricing and Cost of Patient Care policy was
written in 1993, I was the only member on the board (to my recollection)
with a successful background in business and marketing. I was the only
board member to vote against the policy.
If you are interested in why cryonics is not growing and want to be open to
what may be the single most (currently correctable) important reason why we
are not growing, I urge you to express your support for disclosure in this
forum. If you think that growth is important to Alcor's survival and the
cryonics movement's survival, then you should take Linda's advice and read
http://www.alcor.org/crft17.hmt now. It is 13 pages that will make you
realize that Alcor's pricing policy is hard to explain and I think
impossible to defend.
For instance: The document is based on a growth prediction from 1993 until
the year 2007. It predicted that in 2007 Alcor would have 4,000 Suspension
Members and 400 patients. We are half way to 2007 from 1993, do you think
we will hit 4000 and 400? Why not? Could the reason be the prices are too
high?
The first thing most people will ask is how did Alcor fall so far off that
target and the first thing I will state is that in 1993 Alcor priced itself
in such a way as to guarantee that we would miss the target.
There is no way I can take that document and go line for line to show you
how flawed the reasoning is - it is too confusing. But I won't have to.
When you read it it will be obvious. Please take a moment now and pull
that document up.
----------------
pause while you peruse the document, then return to this respectful argument.
---------------
The document is supposed to explain Alcor's costs. It doesn't. There are
2 major parts to every suspension. First part: Preparing the patient
(which can start with standby before legal death, washout in the field,
transport to Alcor, perfusion, cooling to dry ice, cooling to LN2
temperature, inserting into dewar). Second part: Longterm storage.
One can also imagine a need for reanimation funds. At present, the Patient
Care (in a trust) Fund money grows each year. Each year there is more than
the year before. When reanimation technology is available, the Patient
Care money can be used up for reanimation. As each reanimation is
successful there will be a lessor need for money until the last patient is
reanimated and then there will be no need for the fund to continue.
Therefore, the Patient Care Fund is where the renaimation money will come
from. You don't need extra money tacked on if those extra charges are
loosing you most of the new business.
Alcor's document does not give a breakdown on Alcor's costs of the first
part, preparing the patient. It just uses the figures of $25,172 for neuro
and $31,718 for whole body. I would like to see a list of actual items on
this preparation list. My memory serves me that these are not Alcor's
actual costs but more like a fee schedule.
In addition the preparation costs are each made up of actual supplies and
labor. Some of that labor is fixed labor that Alcor has to pay whether
they do a suspension or not.
So it is not certain if all of that labor should be charged.
The document figures LN2 for neuros at $27.04 a year and whole body at
$270.37 per year for when Alcor is post-startup. Floor space for neuros at
$26.47 per year and whole body at 135.00 per year. Dewar and equipment
amortization for neuros at $3.12 and whole body at $31.18 a year.
There are other expenses that are very debatable as to how much should
actually be included as some of them are labor that Alcor has whether they
do no suspensions at all.
They have some safety and return factort which amount to tacking on more
charges.
I would argue that if this policy of high prices make it the case that we
loose 3000 of the projected additional members (I think we will be lucky to
have 1000 members in 2007 at the rate we are going now - not the 4,000 this
policy was predicted to produce), and if we lose 325 near-future
patient-suspensions (I think we will be lucky to have 75 patients by 2007 -
not the 400 this policy was based on), those losses will be much more than
the little extra money Alcor takes in from the higher prices.
The loss of dues from the lost 3,000 members and the loss of revenue from
the 325 lost patient suspensions (the dues would be at present prices and
the lost suspensions would have been at a lower price but still would
generate some income for the Operating Fund and a lot of additional revenue
for the Patient Care Fund) is a *lot* more than the little extra money the
high prices generated on the lessor new members and fewer new suspensions
we will have.
I can't explain it but it seems to me that Alcor's current policy is to
find reasons why they should not do last minute suspensions. I think that
is wrong from a business and from a moral standpoint(s).
Ms. Watson also said something that I think the Alcor Board should read and
discuss and report back to this forum:
>Personally, I feel that any body dead fewer than <n> hours that comes
>with an accompanying check (and power of attorney?) should be
>accepted if at all possible. The person presenting the body and the
>check may need to sign an "I will not sue" agreement, but my best
>guess is that the person suspended would be happy to be alive.
>Get as many people as possible from here to the future, I say!
>Kennita
That used to be the spirit Alcor had when Mike Darwin and Jerry Leaf were
spearheading things. As an Alcor member you wanted to help others take
advantage of cryonics. And we were enjoying good growth. Now it seems
different? I can't explain it.
There are several reason why Alcor should consider Ms. Watson's suggested
philosophy to have affordable ways to save more people not less people:
1. The board has to guide Alcor so that it is a nonprofit organization and
keeps its status. Pricing of its services that excludes most Americans
seems questionable to me. It always has. I don't know of any other
charities that only the top 5% of Americans can write a check for their
services??
If Alcor were ever to loose its nonprofit status about half of its patient
care fund would go to the goverment for back income taxes and penalties. I
suspect Alcor would spend the other half trying to prevent this.
Therefore, it is important that Alcor price is services more reasonable.
2. Alcor would have more money if they did price their services more
reasonable.
Instead of 4000 members (as the present policy predicted) Alcor is only
going to have 1000 members in 2007. If dues are $300 a year that is a big
loss every year to Alcor.
Instead of having 400 patients as the present policy predicted, the high
prices are going to cause us to only have 75 patients. If Alcor had 30
when the policy was initiated, then the gain will be 45 patients instead of
370. 370 minus 45 is a net loss of 325 patients. That is a big loss of
revenue even at reduced prices.
3. Lower prices mean more suspensions. More suspensions mean more members
- the friends and relatives join up.
4. If Alcor does more suspensions they will get better at doing them. That
means that present members will get much better suspensions.
5. Many more suspensions means a much larger Patient Care (trust) Fund.
Even at a lower amount the much larger volume at the lower prices would
generate a much larger Patient Care Fund.
6. There is safety in numbers. If an attack on Alcor ever did come from
the government and we had 4000 members instead of 1000, we could raise 4
times as much money for defense as we did in the Dora Kent and the attacks
from the State of California and County of Riverside.
Alcor Directors have lots of things they need to be working on. If you
think having a more accurate pricing policy is important you need to let
the directors know.
Dave Pizer (retired Alcor volunteer)
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