The funeral and cemetery industry is undergoing profound change. Traditional revenue streams are eroding even as new opportunities emerge for those willing to adapt.
Funeral homes are losing their traditional casket revenues due to competition from specialty casket shops or big-box retailers like Walmart and Costco. Funeral homes attempt to recoup some of those profits by offering cremation services, banquet hall rentals, and similar amenities. Even larger hotel chains are getting into the business of offering reception services after funerals.
As an alternate strategy, many funeral homes are choosing to add glass or granite niches for cremated remains located on their current property — subject to legal restrictions — or on separately purchased plots of land. Funeral homes benefit by having early access to family members making arrangements, and they can package memorial and inurnment services together, thus replacing the lost casket revenue. In contrast to the historical separation of roles, operators are getting into adjacent lines of business hoping to gain market share and sales volume.
Cemeteries face a similar crisis affecting their long-term financial sustainability. Based on projections, U.S. cremation rates were expected to exceed 50% by 2018, and have continued to rise since then. Another factor affecting profits are default accounts or 'no shows' for cremated remains. Up to 80% of cremains do not find their way to cemeteries, meaning many families retain urns at home indefinitely.
Glass-Fronted Niche
The rising costs of burial expenses force customers to look for new methods of memorialization. Stonemasons that produced headstones and memorials faced increased competition and low price margins, and many shifted their focus to being a dealer rather than a manufacturer. This shift provided opportunity for both small-batch manufacturers and overseas production facilities to compete in global markets.
At Global Bronze, our goal is to forge a strong partnership with our customers to help them sell more, at higher profit levels. In our re-branding efforts, we launched a new media division to sync with our customers' needs and assist them with growing their businesses and offering additional products. We also focus on areas of new product development, new patents (like the E-Z Plaques™), contemporary product designs, seamless ordering, and economical shipping.
This still begs the question: How will traditional companies win in the modern funeral industry? The profitability of the funeral market is still secure, but its relevance in the long run depends on the education of the public via marketing channels such as social media. Companies that embrace innovation, build strong partnerships, and adapt to changing consumer preferences will be the ones that thrive.
