10-15 years until Canada runs out of space to bury the dead. (CTV News, 2017)
74.2% projected cremation rate in Canada by 2020. (CANA, 2016)
The death care services industry needs to be brought into the 21st century by reinventing itself in order to remain relevant and profitable.
one. The first big shift came in 2012 with the passing into law of Ontario’s Funeral, Burial and Cremation Services Act. This created new opportunities and triggered an increase in consolidation in the industry. The obvious benefit of the 2012 Act was the ability for operators to offer a full suite of services such as a funeral home, a cemetery and crematorium in a single location if they so desired. Since 2012, Park Lawn Corporation has been acquiring 50 percent stakes in funeral homes and crematoriums across much of central and eastern Canada. Service Corporation International (SCI) has also been busy buying up smaller privately run companies and now has almost 200 sites Canada-wide.
two. The second significant shift came with changing consumer attitudes. The rising costs of traditional funerals, scarcity of burial space, the move to cremation combined with evolving consumer attitudes and the need to keep pace with technology are rapidly altering the industry. Over the past few years the trend is markedly towards tailored services when it comes to our final wishes. Many people plan or pay in advance; either to protect their loved ones from the financial burden or to be certain that they’ll have the funeral they want, down to the last detail.
As a result, there has been a marked increase in the number of funeral cooperatives and ‘no-frills’ funeral service arrangers in the past few years. These providers offer basic services at $4000 or less, which is at least half of the typical cost for a standard funeral package.
While online services in the sector are not new, how you use your website and what you offer your customers could be the differentiator. A user-friendly, interactive online experience will streamline the process, for you and your customers. Consumers want to see all the services available and have total price transparency for decision making.
An area capturing an increasing level of mindshare is what we do with our digital presence after we die. Social media is a part of most people’s daily lives which makes incorporating the management of an individual’s ‘digital legacy’ into your service offering a logical value-add.
These services are currently offered by a number of start-ups and entrepreneurs who sign people up to manage their digital footprints after death, including their libraries of emails, music, books and photos, not just social media history.
We are becoming more environmentally conscious and as we do, the demand for green funerals - devoid of chemicals and other toxic products – will be increasingly common. Alkaline Hydrolysis* (or resomation) will see greater popularity over time because of its significantly smaller carbon footprint compared to a traditional cremation.
Eco alternatives are more environmentally friendly and will become competitive substitutes to cremation and traditional burials. This in turn will drive the need for resomation facilities and “green cemeteries” within easy reach of major cities.
*Alkaline Hydrolysis is currently only legal in Ontario, Quebec and Saskatchewan.
Transforming your business
While death is a certainty for all of us, our funerals can be as individual as we are. To respond to changing demands, death care companies need to be increasingly innovative, offering greater customized and personalized services.
Smaller companies will need to be agile to survive. Consolidation is creating fewer but bigger ‘all-service’ players who are taking full advantage of the changes the 2012 Act brought to the industry combining funeral homes, crematoriums and cemeteries under one banner. Offering non-traditional services will help smaller companies evolve and adapt in order to respond to shifting consumer demands in a world where technology is now all pervasive.
Growth (buy) strategy:
Confidence from the start.
Begin due diligence early. Be confident you’ve derisked the transaction as much as possible and eliminated surprises. Integration of the new entity into your existing business will be smoother.
What’s your property worth?
Undertaking a highest and bestuse analysis of your real estate could identify capital you could unlock to fund your growth strategy.
Plan for disruption.
Recognize which trends, tools and value-added services will extend your reach to attract new customers, and complement your growth strategy. Make technology work for you.
Continue the legacy.
Facilitating a smooth transition to a new leader is vital so that your business will continue in the right hands and make it easier to let go when the time comes.
Exit (sell) strategy:
Know your true value.
A strong exit strategy requires you to fully understand what you’re worth and prepare early to get the highest value for your enterprise.