Landscape Shifting in Funeral Home Industry
It would seem that a pandemic might help the big deathcare businesses. The nation’s largest provider averaged $10,000 in revenue for each of its more than 300,000 cases last year, according to Forbes. But without the ability to “upsell” families and to sell “pre-need” plots, the big guys are hurting.
Contrast their experience to online funeral businesses, like Solace Cremation. The Wall Street Journal recently noted how companies like ours and those that provide digital planning, and virtual funeral services are taking off.
These tech-powered companies, created before the pandemic, have been able to better meet the needs of families seeking digital solutions.
The pandemic comes amidst a trend already well underway as families increasingly have been adopting low-cost cremation to avoid rising funeral prices. The National Funeral Directors Association expects that by 2040, the U.S. will have an 80 percent cremation rate (above 50 percent now). The cost of cremation is a big factor. The median cremation cost in 2019 was $6,645, according to The Ascent, compared to $7,640 for a more traditional burial. That price tops $9,000 when you add a burial vault. (Solace Cremations’s flat price for direct cremation is $895).
In the U.S. and U.K., consumers have been turning to less expensive options and opting increasingly for no-frills (direct) cremations. U.K. company Dignity reported an 11 percent loss in revenue in the first three months of the year as more and more families chose low-cost funerals, according to the BBC.
So on either side of the “pond,” families are choosing new options. It is a difficult time for many, but at the same time, a spark accelerating the changes that were long overdue.
Photo by Quentin Dr