By Thomas A. Parmalee
Carlos Quezada’s life may have been a lot different had he not landed a job at the first McDonald’s to open in Mexico City.
“Our upbringing was very humble,” said Quezada, 52, now the chief executive officer and vice chairman of Carriage Services, which is based in Houston and operates 171 funeral homes in 26 states and 32 cemeteries in 11 states.
The youngest of nine children, Quezada leapt at the chance to apply at the world’s most successful franchise when he was a teenager, and while he probably didn’t realize it at the time, landing a position there was a pivotal moment in his life.
It only ended up being that way, however, because his parents – who worked in the hotel industry before becoming travel agents (and who are both still alive) – instilled in him an appreciation for discipline and hard work.
Those care values ended up being far more valuable than any financial advantage he may have enjoyed had his parents had more money.
“Really what I learned and stuck with me … always do more than you are getting paid for,” he said. “At the end of the day that plays out really well, and it has been my methodology when it comes to work.”
Game Changer
Even before the North American Free Trade Agreement went into effect in 1994, Mexico and the United States began to work together more closely, with McDonald’s entering the Mexico City market in the mid-1980s.
“Before then, there was really nothing from the U.S. coming into Mexico,” he said. “You couldn’t even find a Milky Way chocolate bar. I didn’t really have any friends who would even travel to the United States.”
McDonalds, according to Quezada, “was a whole different world” – and it was the first time he had the chance to engage with American culture and the way of working in America.
“I learned all about replicating success through processes and procedures, which is really what McDonald’s is,” he said.
To put that into context, he explained that whether someone thinks the food from McDonald’s is bad or good really depends on the person eating it, but what does not change is what it actually tastes like.
“A Big Mac will taste like a Big Mac here or in Brazil or in Mexico,” he said. “And that was fascinating to me.”
Quezada put his head down and kept working … and learning.
Whether it was processes, procedures, how to build reputational success, or how to develop staff, he fell in love with learning how to tightly manage things.
“That was really my first exposure if you will to these types of things,” he said. “That mattered because I used some of those ideas in my career … implementing and replicating success in a lot of different places.”
At McDonald’s, he rose up the ranks quickly.
“I went from being a regular employee to the youngest manager of a McDonald’s when I was 18,” he said. “They sent me to Chicago. There is a McDonald’s University that is called the Hamburger University,” he said, noting that some people think it’s a myth, but it’s a real place.
From McDonald’s to Hospitality
It so happened that an executive with Hyatt Regency, which was gearing up to open a hotel in Guadalajara, Mexico, enjoyed eating at McDonald’s, and he liked what he saw in Quezada.
“We built a relationship, and that is how I transitioned from McDonald’s and into Hyatt, which was my second experience with American culture,” he said.
While McDonald’s was great at replicating success, Hyatt was phenomenal at delivering excellent customer service, Quezada said.
The person who recruited Quezada gave him the chance to enter a program where he was trained in a variety of areas related to hotel management.
That opportunity further opened Quezada’s eyes, as he had the chance to mingle with chefs from France, food and beverage directors from Italy and other high achievers from all over the world.
“There was a cultural explosion of things that I had never been exposed to in my life,” he said, noting that this helped create inside him “ambition that I didn’t have before.” He explained, “I wanted to learn what they knew and have what they had.”
Most of them also spoke three or four languages, he noticed.
“I worked really hard to improve myself in learning languages and being able to position myself for success,” Quezada said, who taught himself English.
The chance to see different cultures in action and meet new people also ingrained in Quezada a newfound appreciation for his own heritage.
“When you think about culture, it is so important … especially in our business,” he said. “All of those intricacies within your heritage influence how you build relationships and how you approach people.”
There is also, however, a drawback to having been born in Mexico, said Quezada, who has lived in the United States and been an American citizen for many years now.
“It always felt … not anymore, but for maybe the first 15 years of my career or a little more, I always felt I needed to prove more than other people just because of being Hispanic, and it was odd. But you do it,” he said.
Quezada took advantage of other opportunities in the hotel and restaurant industry before starting his own company that advised hotels and restaurants how to improve processes and procedures and leverage the potential of franchising.
“It was a phenomenal opportunity for me,” he said. “By then, I was able to put everything into play, and I knew how to replicate success.”
But make no mistake about it: starting his own company was hard work.
“When you are used to working for someone, and even if you are in a leadership position, the resources are already there and available for you,” he said. “When you are creating something from scratch, it is your own, and you can create anything the way you want it.” He continued, “But you have to find the funding and the right partners … that was really a great learning experience for me.”
It took a couple of years, however, to turn the venture into a true success. His calling card was helping hotels and restaurants succeed.
“There are a tremendous number of people in Mexico and really South America for the most part who own hotels and restaurants, but they don’t have the processes and procedures in place to make everything consistent first and foremost and to replicate that success,” he said.
He continued, “So, let’s say you own a hotel with 30 rooms, and you are making some money, but you have no clue how to make it a brand and set up a franchise.”
The solution would be to hire Quezada, who then transferred all his experiential knowledge into a plan to standardize processes and procedures so they could be replicated and sold as a franchise.
“Then you would have a franchise you could sell,” he explained. “If you want to own a second hotel, it would be $5 million or $10 million more. But going through the franchise process allows you to get a share of profits from someone else’s investment over time. You can grow to 10 hotels in two years through the franchise system, and it would be equivalent to the profits you would get from one hotel but without investing any money into it.”
Looking back at his career trajectory, even Quezada seemed to marvel at the fact that after his first job at McDonald’s to the time he was about 37, he never applied or asked for a job.
“Somehow, things worked out because of my work ethic and the quality of the work,” he said, noting that he had begun – and still does – voraciously read three to four books every month.
The truth of the matter was he had become addicted to continually improving himself, whether it was in a corporate setting, in an accounting role or whatever post he held at a given time. “I will learn it and learn it better than most just because I want to be better than everyone else,” he said. “Why not? … not to compete against others but because I was competing against myself. I always want to fulfill my potential – whatever that is.”
During this time of growth, he shuttled back and forth between Mexico and the United States on a variety of occasions, getting trained in various aspects of business and further broadening his horizons.
After he sold his consulting business in Mexico, he fielded a phone call that he was not expecting. It was a recruiter from a company called Service Corporation International – and it changed everything.
Entering the World of Death Care
The call came in 2009 as Quezada was plotting his next move.
“They were looking for someone to develop their Hispana division,” Quezada explained, noting that the company flew him to Houston before sending him to Los Angeles to meet with a managing director.
“And basically, they hired me on the spot,” he said.
When the recruiter asked him if he had ever thought about working in the funeral or cemetery profession, Quezada was honest and said no.
“Never in my life had I thought of it as a career,” he said, noting that wasn’t for lack of exposure: He had a friend whose family was in the death-care business.
“It was interesting, but I had never thought much about it,” he said.
But after learning of the opportunity, Quezada realized that his background in hospitality would allow him to promote changes that would pave the way to serve families in a way they had never been served before. That opportunity still exists, he said.
“That was really the catalyst,” he said. “It gave me an opportunity to make a name for myself and to transform a business that was so traditional – and still is to a significant degree in many cases.”
Quezada also found himself applying the lessons he learned at McDonald’s, even though he had thrown himself into an entirely new business.
At McDonald’s, he explained, there is an evolutionary process of ingraining employees into all levels of the business. “For example, you would work on just putting dressing on buns and making the burger – dressing the burger and putting meat and cheese on it and wrapping it,” he said. “As you evolve, you work the grill and then the drive-thru and being the cashier.”
That attention to detail allows a McDonald’s employee to “understand the 360 of the business,” Quezada said. “I knew that was critical – I needed to understand the 360 of funeral homes and cemeteries … I had to do it all.”
Although he’s not a licensed embalmer, it included witnessing embalming, he said. “I even worked with the maintenance crew to see what they do on a daily basis,” he said. “I did a lot of extra work to understand holistically what it is we do.”
He knew intuitively – always has known – that if he can understand that 360-view, he can exert more influence, help more people and drive more successful outcomes for everyone – whether they be shareholders, grieving families or team members.
Within three months of joining SCI, Quezada was promoted, and he spent the next five years creating a best-in-class organization.
Eventually, a mentor pulled him aside and candidly told him that if he wanted to advance further, he needed to move out of sales and into operations. That was where he could make the most impact by changing the way the company served families.
At the time, SCI had a very specific way it wanted to operate, but Quezada was lucky in the sense that he had “a little wiggle room” to do things differently in the Hispana division.
“That wiggle room allowed me to transform service into what I wanted to make it better,” he shared.
In a bid to raise the bar, he introduced “10 wows” that highlighted 10 specific moments on the customer journey where SCI staff could help families. “It was so popular that SCI instituted it nationwide across the company,” he said.
That focus on 10 wows revealed a disconnect in the profession that is still evident today, according to Quezada.
The discrepancy lies in the fact that so many funeral professionals have an overwhelming desire to serve families, but a good number of them simply don’t know what those families want or how to deliver great customer service.
That means many times, funeral homes fail to satisfy expectations, but when you can align purpose, passion and fulfilling expectations, “it’s almost like magic happens,” he said.
“My goal was how can I create an attitude of service and create a journey for the families that is very specific, intentional and driven by learning what is it they need,” he said.
A goal that large meant spending a year interviewing families, asking them what they expect on the first call, what they want to have when they leave the arrangement office, and so on – at every step in the process.
That attention to detail was what allowed Quezada and his team to make meaningful changes that were often instituted throughout the organization.
The Move to Carriage Services
Quezada’s next big move did not involve him submitting his resume somewhere in a bid to take on a new position. As usual, someone came to him.
“In February of 2020, I got a call from a recruiter at Carriage Services,” he said.
Since he’d been working at SCI for over 10 years, Quezada obviously knew about Carriage Services but not at an intimate level.
“I am a very focused individual and when I am working on something, if I am not in direct competition, I don’t even look at it,” he said. “I don’t want to get distracted with stuff not in my purview. So, when I was doing work at SCI, I of course knew who Carriage was … but I wasn’t really tracking them, because I had opportunities to pursue in front of me, and that was not really my focus.”
The phone call, however, piqued his interest.
“It was the right time to receive that call,” he said. “I had at the time satisfied my curiosity related to the role I was driving” – and he’d achieved most of his goals.
He’d also slowly come to the realization that even though he’d transitioned from being the director of sales to being the managing director of strategic operations improvement, there was not much room to further advance.
“I understood my possibility for growth in career progression was limited,” he said, noting that most of the executives at the top of SCI – at the time at least – were his age or a little older. “They were going to be there for a long time,” he said. “And so … when I received that call, I was curious about what the opportunity was.”
Quezada had a conversation with the former CEO and co-founder of Carriage Services, Mel Payne at the company’s headquarters, but shortly thereafter, the COVID-19 pandemic erupted, and everyone started working from home. Quezada began to think that nothing was going to come out of the meeting.
“I went back to work and focused on what was in front of me,” he said, which largely consisted of helping his team navigate a very difficult time.
A few months later, however, Carriage Services called him back, and this time, Quezada met with the entire executive team. An offer to join the company as vice president of sales and marketing quickly followed.
“If you want to know why I came to Carriage, it was because the same opportunity I saw at SCI … and that is still true at SCI … I saw here,” he said.
That opportunity consisted of being able to make a positive impact.
The path to make that impact, however, was perhaps a bit clearer and more immediate at Carriage, as Quezada noted that he saw a public company that was significant in size with no marketing department and no one driving information technology functions.
Even more notable was the fact that he did not see a cohesive preneed cemetery strategy. In its place were outdated sales compensation plans.
“I saw all of that really quick,” he said.
What he also saw was an opportunity to be a top executive, albeit at a much smaller company.
“I saw I could create a positive impact,” he said. “To me, it is about how can you influence people in a way to create a positive impact for every stakeholder.”
In short order, Quezada was named Carriage’s president and chief operating officer, and in June 2023, he was promoted to vice chairman and CEO, with Payne becoming executive chairman.
Quezada has the utmost respect for Payne, who he called “a fabulous, one-of-a-kind individual.” He added, “He has such a wealth of experience, not just in this industry, but in banking and finance and life in general.”
The two men have gotten to know each other well over the past few years, meeting together on Mondays for two-hour meetings in which they talk about the company, life, psychology and all manner of things, Quezada said.
“He assigned me a curriculum of books to read, and I did, and I applied those learnings to questions he would ask me over time,” he said. “He is truly a fascinating man and my biggest mentor.”
Payne, now 80, suffered a stroke in February, but his recovery “has been remarkable to witness,” Quezada said. “He’s not coming to the office as much, but mainly because he wants to be respectful of the succession and transition,” he said.
As to what he’s most proud about achieving at Carriage Services, Quezada is quick to pinpoint the growth in preneed cemetery sales, which was one of the main reasons the company hired him, he said.
“Every cemetery had its own compensation plan,” he said, and none of them correctly focused on growing cemetery sales. “And there was no consistency to planning cemetery development,” he said, observing that a business can invest $1 million into improving a cemetery, and the design can be perfect, but if you don’t effectively market the improvements, then you don’t realize the full potential of your investment.
In other words, “It’s not just making the cemetery beautiful, but how do you accelerate cemetery inventory sales velocity?” he said.
Getting the right compensation plans in place and hiring the right people have been critical to success, he said. “From the baseline of 2019 to where we are today, we have more than doubled preneed cemetery sales,” he said.
The company also has a marketing team now – something it never had before, which Quezada called “a big problem.”
There is also more emphasis on information technology, with the department shifting from being reactive in solving problems to proactive in avoiding them. Moreover, systems have been developed that allow families to interact with and engage with technology in a “seamless and friendly” way, he said.
Challenges, however, remain, including the fact that the company is still in the midst of recovering from having bought back too many shares of its own stock in 2021 and 2022 – and at too high a price, he said.
The problem, he explained, is that the shares were bought under a revolving credit facility, and now with the rapid increase in rates, the company is paying higher levels of interest. That has made it harder to pursue acquisitions as aggressively as it would like, he said.
“But we have a plan,” he said, noting that the company is paying down debt as aggressively as it can, so it can renew its focus on acquisitions.
Payne addressed the issue of the stock in detail in a Dec. 12, 2022, news release. He said, “I have taken sole responsibility for too aggressively repurchasing our shares after our eight year $400 million 4.25% Senior Notes refinancing on May 13, 2021 (3.6 million shares for approximately $175 million equal to almost 20% of shares outstanding at $49.06 per share). Given our record performance throughout FYE 2021 and the first quarter of FYE 2022, combined with the historically low inflation and interest rate environment at the time, I believed we were repurchasing these shares at well below Carriage’s Intrinsic Value Per Share.”
Payne continued, “The “Big Picture Goal” of HPCPRP (High Performance and Credit Profile Restoration Plan) is to substantially increase our consolidated and per share performance metrics during 2023 and 2024 (20% less common shares) to levels approaching our record performance metrics in 2021, while simultaneously rapidly paying down our debt under our $250 million Credit Facility to substantially deleverage our balance sheet, much like we achieved from the beginning of 2020 at 6.0 times Debt to EBITDA proforma four large acquisitions to 3.8 times by March 31, 2021 just prior to our Senior Notes refinancing.”
He added, “We believe the successful execution of HPCPRP through 2023 and 2024 will create Intrinsic Value Per Share that exceeds the $49.06 per share average price of the 3.6 million shares repurchased since May 13, 2021. Moreover, notwithstanding the external macroeconomic environment, we believe that the valuation multiples applied to our increasing consolidated and per share performance metrics during this period by equity investors (Mr. Market Price Per Share) will expand in direct correlation to the success of our balance sheet deleveraging program under HPCPRP.”
Fears, Hopes and Lessons
Asked about concerns he has about the profession at large, Quezada noted that what the Federal Trade Commission rules in terms of pricing transparency is not one of them.
Pricing transparency for renting a car, for instance, has been around for many years, but it doesn’t translate into someone always choosing the cheapest rental car, he observed. The key is for the consumer to believe that what they are spending and the value they get for their money is in alignment, he said.
He does think that the profession’s own focus on direct cremation often drives consumers to consider price than they would otherwise.
“They are creating an awareness that was not there before, which is making it more challenging,” he said. “We think it is the customer asking us for it, but the reason the customer is asking for it is because of the advertisements that are out there now.”
The biggest threat with direct cremation, however, is it often leaves families feeling shortchanged when they hear about all the options they could have chosen when it’s too late.
“Our job as an industry is to really educate families on what is possible – and what is possible is expanding more and more with technology,” he said.
If the profession fails to provide such an education, Quezada’s “biggest fear” may be realized, which relates to the hospitality industry taking a bite of death care’s market share.
“You can have an incredible life celebration at any event center,” he said. “They have a ballroom and space to do anything you want. They will deliver service better than we can because that is what they do – deliver service. They are event planners and can plan something better than we can today, but we can do better than they do tomorrow – at least for funeral service.”
If the people who love the profession don’t do their part to transform death care, then eventually “you will find funeral directors working for hotels and other companies, which can take a little bit of our share,” he said.
As to some lessons that he lives by, Quezada ticked off a short but meaningful list.
“I hate procrastination,” he said. “Try not to leave something you can do today until tomorrow.”
He also is an ardent believer in telling the truth, even if it might be embarrassing or means owning up to a mistake.
“The freedom that exists when you tell the truth is very significant,” he said. “Sometimes, I see people who go through life and struggle with this, and they can never be truly themselves because they are in a bubble. Honesty and integrity are big things in my life.”
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