Profits Are Stagnant. But the Funeral Industry Is Not Dead Yet.

New York Times

15-05-2025

'Making It Work' is a series about small-business owners striving to endure hard times.
When a young hunter died, Lanae Strovers didn't plan a funeral service with organ music and the Lord's Prayer. After Ms. Strovers, a director at Hamilton's Funeral Home in Des Moines, Iowa, heard the man's family wish for one last hunt with him, she asked a gunsmith to put his cremated remains into some shotgun shells. Then she helped the family plan a hunt in his honor.
For a beloved Little League coach, Ms. Strovers turned her funeral home into a mock baseball field, with bases, a popcorn machine and hot dogs. She created a circus — bouncy house, snow cones and all — to commemorate a child taken too soon. She hosted a cocktail hour for a woman who had been a model and fashion designer, building a runway and dressing mannequins in her clothing.
In recent decades, the national cremation rate has skyrocketed. That's led profits from funeral services to drop. At the same time, the costs of gasoline, embalming chemicals and staffing have risen. With the steadfast industry on uncertain footing, funeral directors have been forced to innovate.
' I don't want to say that we're going to become party planners,' said Ms. Strovers, who is a spokeswoman and trainer for the National Funeral Directors Association. 'But I think that those two lines are crossing over and we just need to open up our thought process and be there to help the families.'
According to a 2024 N.F.D.A. report, more than half of the industry's revenue comes from funeral planning services and the sale of items like caskets. When customers elect cremation, that revenue can be significantly lower: The median cost of a direct cremation, which doesn't include a viewing or service, is $2,750, about a third of that of a traditional package with a casket, viewing, ceremony and burial, which is $8,300.
The N.F.D.A. cites numerous reasons behind the popularity of cremations, including cost; environmental concerns; and consumers who are less religious, more transient and increasingly averse to heavily ritualized ceremonies.
Similar to other industries, funeral homes have also had to contend with rising costs, the biggest of which is staffing. A serious shortage of licensed funeral professionals has forced some funeral homes to raise wages or expand benefits.
'You're bringing less funds in, but you're also short staffed,' Ms. Strovers said. 'So you're trying to hire people and offer a salary that is acceptable. It's a balance, right?'
While some industries could seek out new customers, that's not easy in this line of work. The rising number of deaths from baby boomers, the oldest now in their late 70s, will be offset by the cremation rate in the United States, which is expected to hit 82 percent by 2045. An analysis from IBISWorld, a research firm, predicts that industry growth will be slow, increasing at an average rate of just 1.2 percent annually over the next four years.
Walker Posey's family has been running Posey Funeral Directors in North Augusta, S.C., for over 140 years. Though he's in a relatively traditional and religious part of the country, Mr. Posey said the percentage of customers picking cremation is five times what it was a decade ago.
'When people choose cremation and don't choose to have a service attached to it, then the revenue could be drastically lower,' he said. 'But our operational costs remain the same.' His business still needs to maintain its building, vehicles, staff and more.
Mr. Posey's solution has been education: informing families that, even if they opt for cremation, they can still add traditional elements such as a viewing or service. He's also been looking into purchasing nearby funeral homes as a way to expand his customer base.
And, like Ms. Strovers, he's been defying convention when it comes to services. One of his directors hired a group of costumed superheroes to be the greeters at a young boy's memorial. When a popular local bartender and musician died, Mr. Posey invited several of the man's favorite bands to play at a theater downtown. Nearly 800 people came.
Mr. Posey, an N.F.D.A. spokesman, said that his great-grandfather might be surprised by the direction the family business has taken.
'We're no longer just a funeral company who does events,' he said. 'We're an event company who does funerals.' He believes that funerals share many similarities with weddings — and that it's time for funeral homes to start embracing it.
Some already have a running start in that direction. More than a decade ago, Einan's at Sunset Funeral Home in Richland, Wash., built an airy 6,000-square-foot event center with a patio and a catering menu that includes a brisket buffet and chardonnay.
It's so unlike a traditional funeral parlor, in fact, that 10 to 20 couples hold their weddings there each year. It's even hosted multiple proms. The events center proved so popular that Einan's later spent $2.5 million remodeling its main funeral home — which had the dark and stuffy look of yore — in the same fashion.
The Pacific Northwest has long had some of the highest cremation rates in the country, in part because its residents tend to be less religious and more transient.
'These people that we're serving are not wanting what we were offering 40 years ago,' said Sarah Smith, a funeral director at Einan's. 'It's not the same people, it's not the same wants, it's not the same likes and tastes.'
Einan's has adapted its approach in other ways, too. After hearing that some families couldn't afford its full-service offerings, it created two offshoot businesses centered on low-cost cremations.
Faith Haug thinks more funeral homes should consider revamping their business models. She is the chair of the mortuary science department at Arapahoe Community College in Littleton, Colo.
Savvy funeral homes, she said, will find ways to satisfy changing tastes and tight budgets. She also sees a future in alternative arrangements, such as human composting or green burials. Companies that offer these services, she said, have 'truly changed how they operate as a business to give people what they want — and it's not a $10,000 funeral in a metal casket.'
If funeral homes fail to adapt, Ms. Haug fears that some will end up closing their doors. Others could sell out to corporations: At the moment, roughly three-quarters of funeral homes are family- or privately owned.
The one thing she's not concerned about? That the industry will go extinct.
'Funeral service will exist until there are no people,' Ms. Haug said. 'I mean, animals care for their dead — the profession is not going away. But it does look different than it used to, and it is going to continue to evolve.'