Five Challenges Facing Funeral Homes

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To work well with funeral service professionals, we think it’s essential to understand their working worlds. Here are some of the challenges we’ve been learning about through original research, publications,  and conference presentations.

Losses to traditional sources of revenue

Funeral homes are facing losses in revenue per client due to increasing rates of cremation & reduced demand for embalming, public services, and merchandise. The American cremation rate was 55.9% in 2020 and is expected to reach 78.4% by 2040.[1] The Canadian cremation rate was 74.8% in 2020 and is expected to grow to 87.9% by 2040.[2] Likewise,  it is also now easier than ever for consumers to compare pricing and shop online for merchandise traditionally sold by funeral homes (e.g., caskets, urns). Decreases in ancillary product sales (which makes up a significant share of funeral home revenue) has further reduced revenue per client. The Canadian funeral home industry saw an overall profit loss of 1.3% from 2015 to 2020.[3] Whereas the American funeral home industry saw a marginal profit gain of 0.3% and a revenue loss of 0.8% from 2016 to 2021.[4]

Staffing shortages and burn-out

The funeral profession is facing staffing shortages, resulting in over-commitment and burn-out among employees. More people are retiring from the workforce than entering it.[5] Much like in other industries, COVID-19 has served to further worsen staff shortages.[6] Combined with rising death rates and increasing training requirements, these staffing shortages leave funeral service professionals stretched thin.[7] This is having a disproportionate impact on women in the profession, who show higher levels of anxiety, depression and job stress compared to men.[8] Continuing education courses on overcommitment, stress management, and self-care evidence institutional aims to protect the well-being of funeral service professionals.[9][10]

A need to stand out

High competition means funeral homes need to work hard to stand out. Heightened competition with low cost funeral providers, independent crematories and online retailers has negatively impacted funeral home profitability.[11][12] From funeral home to funeral home, competition is largely based on reputation, price and location.[13] Maintaining competitive pricing and a positive reputation is especially critical in communities that host more than one funeral home. In light of rising competition and revenue pressures, marketing has become more important over the past five years.[14]

Increasing wage costs in a labor-intensive profession

The funeral profession is labor-intensive, with wages making up the largest expense for the industry, absorbing about 29.5% of total revenue.[15] Whereas capital expenses have stabilized over the past few years, wage costs have risen.[16] In this environment, funeral home owners are finding it difficult to increase staffing levels.[17] Dealing with an excessive number of estate-related questions takes up precious staff time. To ensure profitability, funeral homes must have effective controls on these labor-related costs.[18]

Families requesting help that exceeds their professional scope

Funeral service providers receive requests for support that transcend the scope of the profession. Previous literature has found that funeral professionals are prone to feeling a lack of control in their work environments, especially given their unpredictable and demanding schedules.[19][20] This is especially common in smaller firms.[21] In our interviews, funeral service providers described the importance of setting boundaries on their professional responsibilities while doing what they could to support the family, whether that meant referring clients to other professionals or admitting instances where they didn't have an answer to a legal, financial, or grief-related question. In essence, setting boundaries was described as an adaptive strategy for coping with a fluid work schedule and role.

How can Cadence help?

Cadence pairs an online platform with compassion, expert support to help families navigate the logistical challenges they face after losing a loved one. The service compliments funeral home aftercare programs by ensuring families have the information, tools and support they need to take care of the steps that come next. Cadence offers assistance with: government notifications and benefits, subscription and account closures, insurance and pension claims, identity theft protection, and probate and tax guidance.

How it works: During an optional phone intake, an advisor explains the Cadence process and determines the level of support the client requires. After answering a short questionnaire, the client gets access to the auto-populated forms, important resources and a customized, "how-to" guide on the Cadence platform. Clients move through the guide at their own pace and if they need extra help, they can reach out to a Cadence advisor at any time.

This solution supports seamless client handoff, easy case management and on-demand support for funeral service professionals. For busy funeral homes that are struggling with staffing shortages, Cadence’s automated process can reduce staff time spent on aftercare, paperwork, and estate-related questions. By automating the paperwork and providing ongoing, personalized guidance, Cadence gives providers back time to focus on supporting their families. Families who use Cadence thank their funeral homes for the robust, personalized and ongoing support by becoming lifelong clients and leaving positive reviews. Cadence educates clients about the value of pre-arrangements and links them back to your team when they are ready, helping you increase pre-need sales.

To learn more about Cadence’s services for funeral homes, click here.

References [1][2][3][10]National Funeral Directors Association [NFDA]. (2021). 2021 NFDA cremation & burial report. [3][12][14][15][16][18]Koronios, E. (2020). IBISWorld Industry Report 81221CA. Funeral Homes in the Canada. IBISWorld Database. [4][13]Ristoff, J. (2021). IBISWorld industry report 81221: Funeral homes in the US. IBISWorld Database. [5][7]Krause (2021). Addressing the challenges of funeral home staffing. The, 6(1), 3-4 [6]Bicknell, B. (2022, January 11). Funeral services call on students and retirees to alleviate staff shortages. CTV News. [8]Durand-Moreau, Q., & Galarneau, J. M. (2021). Mental health status of Canadian funeral service workers at the beginning of the COVID-19 pandemic. Journal of Occupational and Environmental Medicine, 63(6), e330–e334. [9]Canadian Funeral College. (2022). Continuing Education. [11]Crabtree, L. S. (2010). The changing discourse of death : a study of the evolution of the contemporary funeral industry (Publication number: 286). [Master’s thesis, University of Louisville]. ThinkIR. [17]Funeral Director Daily. (2022, January 30). Throwback Thursday - the staffing shortage. [19]Bailey, M. E. (2019). How funeral directors experience burnout: A phenomenological study (Publication number: 13813579). [Doctoral dissertation, Grand Canyon University]. ProQuest. [20]Carr, M. R. (2019). The Influence of emotional intelligence on occupational stress among funeral directors: An interpretative phenomenological study (Publication number: 13862951). [Doctoral dissertation, Grand Canyon University]. ProQuest. [21]Funeral Service Insider. (2020, August 24). Pay levels for owners and directors are largely unchanged, but enthusiasm for the profession remains vibrant and strong. Kates-Boylston Publications.