Death Care Services

Industry Profile Report

Dive Deep into the industry with a 25+ page industry report (pdf format) including the following chapters

Industry Overview Current Conditions, Industry Structure, How Firms Operate, Industry Trends, Credit Underwriting & Risks, and Industry Forecast.

Call Preparation Call Prep Questions, Industry Terms, and Weblinks.

Financial Insights Working Capital, Capital Financing, Business Valuation, and Financial Benchmarks.

Industry Profile Excerpts

Industry Overview

The 15,000 death care service providers in the US prepare the dead for burial or interment, conduct funerals, and operate sites or facilities reserved for the interment of human or animal remains. Death care service providers include funeral homes, cemeteries, and crematories. Funeral homes account for about 74% of firms, while cemeteries and crematories account for the remainder. Some companies operate facilities that provide funeral services and cemeteries at the same location.

Pre-need Sales Dependent on Financial Markets

Because the proceeds from pre-need sales are typically invested in stocks, bonds and other instruments, death care service providers are vulnerable to declines in financial markets.

Government Regulation

Because the purchase of death care services occurs when families are especially vulnerable, sales are regulated at the federal, state, and local level.

Industry size & Structure

The average death care services provider operates out of a single location, employs 8-9 workers, and generates over $1 million annually.

    • The death care services industry consists of about 15,000 companies that employ 131,600 workers and generate about $18.6 billion annually.
    • Funeral homes account for about 74% of firms, while cemeteries and crematories account for the remainder.
    • The funeral home industry is fragmented; the top 50 firms account for about 22% of industry sales. The cemetery industry is less fragmented; the top 50 firms account for about 53% of industry revenue.
    • Traditionally, death care service providers have been small, family-owned businesses that are passed down for generations.
    • Large companies include Service Corporation International and Carriage Services.
                          Industry Forecast
                          Death Care Services Industry Growth
                          Source: Vertical IQ and Inforum

                          Recent Developments

                          Oct 28, 2022 - Pet Death Care Industry Growing
                          • The pet death care industry is growing exponentially in line with pet ownership and pet expenditures. The national pet industry exceeded $123.6 billion in sales in 2021, the highest in history, the second consecutive record-setting year for the industry, following a banner year in 2020, which for the first time exceeded $100 billion in sales, according to the American Pet Products Association (APPA). Spending increased across every category including death care and grief supplies. Dedicated pet cemeteries and funeral homes are growing in number as are services for pets provided by traditional funeral homes. A new pet funeral home, Dulaney Valley Pet Loss Center, dedicated to pet services and funerals opened in Baltimore in September 2022. “The Pet Loss Center is where people can come to grieve and have the ability to say goodbye to their beloved pets or witness their cremation,” said general manager Amy Shimp.
                          • The Federal Trade Commission (FTC) in October 2022 issued an Advance Notice of Proposed Rulemaking seeking comment on potential updates to modernize the Funeral Industry Practices Rule, including making improvements to public accessibility of funeral home price information. Areas of concern expressed by the industry at a meeting with FTC commissioners included the funeral rule’s trigger for presenting a general price list (GPL) to families, which the National Funeral Directors Association (NFDA) says is vague and imprecise and, as written, stifles competition and keeps prices artificially high for consumers. NFDA also contends the rule doesn’t adequately address the challenges that may be imposed by language or cultural barriers when a funeral director presents a GPL to a family. As for whether pricing is posted online or not, the industry says it should be an individual business decision.
                          • As COVID-19 deaths have fallen, funeral directors are taking stock after one of the busiest and most emotionally trying periods in the industry’s history, according to recent reporting by The Wall Street Journal. While the pandemic and resulting spike in deaths often led to increased sales and profits, it also took its toll on funeral home operators and their staff. About 40% of National Funeral Directors Association members reported higher profits in 2021. Industry-wide revenue increased about 8% in 2021 to $21.7 billion, according to a Marketdata estimate. However, some funeral homes were challenged by higher costs and sparser services that hurt the bottom line. Service Corp. International, which operates 20,000 funeral homes nationwide, has said that the pandemic could drive more business for years due to knock-on effects on health and mortality.
                          • Cremations were gaining market share before the pandemic and grew even more as the health crisis wore on, according to the 2022 Cremation and Burial Report released in August by the National Funeral Directors Association (NFDA). There are expected to be about 1.91 million cremations in 2022, which will grow to 2.26 million by 2030, and 2.94 million by 2040. Amid the growth, more funeral homes are operating their own crematoriums. Nearly 40% of funeral homes currently operate crematoriums, and another 12% plan to add them in the next five years. About 40% offer cremation arrangements online, and more than 28% plan to add the service in the next five years. The NFDA said lower cost relative to burial is driving cremation demand, as well as fewer people identifying with a religion.
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