Funeral Services Industry Overview

Excerpt from Funeral Services Report

Companies in this industry conduct funerals and provide burial-related services. Major companies include Service Corporation International (SCI), Stewart Enterprises, and StoneMor Partners (all based in the US), along with Arbor Memorial Services (Canada), Dignity (UK), and Funespaña (Spain).

Competitive Landscape

Demand for services is driven mainly by local mortality rates and the population of aging people. The profitability of individual companies depends on sales and marketing and efficient operations, because local demand is relatively fixed. The main advantage of large companies is their ability to share resources (limos and hearses, embalmers, and marketing costs) among clusters of funeral homes. Small operators can compete successfully with national companies because the funeral business is intensely local. The industry is fragmented: the 50 largest companies account for about 25 percent of industry revenue.

Products, Operations & Technology

Pre-burial services, which include embalming and cosmetic preparation, transportation, facility rental for wakes and memorial services, account for about 50 percent of revenue. Sales of caskets and other funeral goods (urns, wreaths, etc.) make up about 45 percent of revenue. Other sources of revenue include burial rights. Funeral homes typically conduct about 120 funerals a year, so physical assets requiring large investment (facilities, hearses, limos) are often idle.