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Funeral Operations Industry Profile Excerpt
| SIC Codes: 7261 NAICS Codes: 8122 Page Length: 10-12 Last Quarterly Update: 12/22/2008 View Sample Industry Profile |
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The US funeral industry includes 15,000 companies that generate about $15 billion of annual revenue from the operation of 16,000 funeral homes and 7,000 crematoriums and cemeteries. Large companies include Service Corporation International and Stewart Enterprises. The industry remains highly fragmented, despite strong consolidation in the 1990s. The top 50 companies hold only about 30 percent of the market. Most companies operate a single funeral home, with annual revenue close to $1 million.
COMPETITIVE LANDSCAPE
Demand for services is driven mainly by the number of older Americans. The profitability of individual companies depends on good marketing and efficient operations because local demand is relatively fixed. The main advantage of large companies is their ability to share resources (like cars, personnel, 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 fairly labor-intensive: annual revenue per employee is $100,000.
PRODUCTS, OPERATIONS & TECHNOLOGY
Companies in the industry sell products like caskets, burial vaults, burial garments, flowers, burial rights, memorial stones, and cremation urns. Services include body preparation, transportation, facility rental for wakes and memorial services, opening and closing burial plots, and cremation. Caskets are the largest cost item for most funerals. National suppliers include Batesville Casket, Aurora Casket, and Matthews International. Most funeral homes conduct fewer than 100 funerals a year and have a large investment in physical assets that are often idle. ...
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