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Funeral Business Changing

Leader in Low Cost Funeral and Cremation Services

Funeral business changing; large companies continue to acquire family-owned facilities.

The death care or “funeral” industry is changing. Cremations, less expensive than burials, are rising, and some people choose to have a less elaborate but more personalized funeral, while others opt for no funeral.

Despite those trends, the industry is projected to grow through 2017, according to research firm IbisWorld. As the population ages and the U.S. death rate continues to increase, the industry’s revenues are expected to increase from $13.4 billion in 2012 to $14.1 billion in 2017.

 

Northwood Funeral Home owner Ernie Gagnon. (Allen Eyestone)

Family-owned, independent funeral homes continue to be snatched up by such large publicly held corporations as Service Corporation International (NYSE: SCI) of Houston, the nation’s largest funeral home owner and operator.

In July, SCI announced it had acquired Quattlebaum Funeral Home, which had been family-owned and operated in West Palm Beach since 1955. The building and property are being sold to Palm Beach Atlantic University, and SCI will be using the Quattlebaum name on one of its other local facilities.

Greg Quattlebaum said the decision made sense because none of the family’s younger generation was interested in taking over the business, and PBAU has wanted to purchase the property for years.


“SCI already has a network of funeral homes in the area. Instead of being a single-point location, we will be serving the community in a more broad and convenient way,” said Quattlebaum, who along with his brother Gary Quattlebaum and sister Gale Schiffman, is now an SCI employee.


Acquisitions by large firms began in Palm Beach County in 1974 with SCI’s purchase of Mizell-Faville-Zern in West Palm Beach.


Jessica Koth, spokeswoman for National Funeral Directors Association, Brookfield, Wis., said, “Currently about 14 percent of funeral homes are owned by a publicly-traded corporation; and 86 percent are privately owned by families, individuals or small, privately-held corporations.”

But in Palm Beach County, a much higher percentage, about 40 percent, are owned by corporations such as SCI, Stewart Enterprises, Northstar Group and StoneMor. Approximately 60 percent of the 40 or so funeral homes are independently-owned. “In a metropolitan areas like ours, a lot of people are getting acquired,” said Brad Zahn, owner and funeral director, Tillman Funeral Home in suburban West Palm Beach. “Most of the corporations have a presence in Palm Beach County, with SCI the largest.” SCI owns and operates 1,437 funeral homes and 374 cemeteries in 43 states, eight Canadian provinces and the District of Columbia. It has 11 funeral homes and three cemeteries in Palm Beach County, said SCI spokeswoman Jessica McDunn. SCI’s proposed $1.4 billion acquisition of Stewart Enterprises, the nation’s second largest funeral service provider, is pending. If it closes as expected by early 2014, the company will become even larger.

Independent funeral homes say there are major differences between the facilities owned by SCI and those owned by families or local partners.

“We answer to our families and look to please our families, and the corporations look to please shareholders,” said Vince Sharkey III, general manager and the owner’s son at All County Funeral Home & Crematory, Lake Worth. For starters, the independents say some consumers are not aware that the SCI-owned funeral homes, which carry the Dignity Memorial brand, are no longer owned by the family or families whose names are still on the signs. When possible, SCI continues to employ some of the former owners. Bigger isn’t better, the family businesses say, and in fact, prices at SCI funeral homes in Palm Beach County are considerably higher than at the independents, the Palm Beach Post found in a price survey. “With each sale of these independent funeral homes, you lose the personal touch that goes along with serving these families,” said John Lloyd, an employee of Northwood Funeral Home & Crematory in West Palm Beach, owned by Ernie Gagnon since 1969.

Lloyd wants people to know that while independent operators handle a loved one’s remains at their locations, SCI’s operations are centralized.


Left-right: Gary, Greg, Phyllis Quattlebaum and Gale Q. Schiffman of Quattlebaum Funeral & Cremation Services acquired by SCI. (Thomas Cordy)

When SCI-owned funeral homes from Howard-Price in North Palm Beach to Babione in Boca Raton are contacted about a death, they transport the deceased to a centralized facility in Lake Worth. There, bodies are embalmed, dressed, cosmetized and casketed. They are then put in a van and delivered to the funeral home that is handling the arrangements. No matter which SCI-owned funeral home a family chooses in Miami-Dade, Broward or Palm Beach counties, all SCI cremations are done in Fort Lauderdale. McDunn confirmed that SCI’s operations are consolidated. “We have central care centers. It helps us consolidate some of our services, therefore, it helps us save money and helps pass on those savings to our client families. If each facility had to operate independently, then it would be more costly,” McDunn said.

Despite the centralization, SCI’s prices for cremation are the highest of those surveyed, at $995. In fact, in a comparison of price lists obtained from four independently owned-funeral homes and two SCI-owned facilities, its fees were the highest in almost every category. McDunn said SCI’s prices are higher due to number of benefits it provides, such as national transferability of pre-arranged services, bereavement travel assistance and access to a 24-hour grief counseling help line. Price is just one of many factors that should be considered. “If you make your prearrangements with one location, then say you move to Houston, for example, you are able to transfer your prearranged services to that funeral home,” McDunn said. SCI customers who have pre-paid are provided with the same level of funeral or other services free for any of their children or grandchildren who die under the age of 21 and unmarried, McDunn said. “The best way to get the best price for funeral and cemetery services is to pre-arrange. It gives you the opportunity to shop around,” McDunn said. “Find a facility you feel comfortable with.”

SCI has introduced certified funeral celebrants in some of its other markets and hopes to offer the service in Florida soon. The celebrants tend to work with those who want a non-traditional service, although it can include religious elements, McDunn said. “They plan a service that is not cookie cutter. The spend a lot more time with the family and find out what they family wants or needs and what they are interested in. It is a way of personalizing something,” McDunn said. Julian Almeida, who co-owns Palms West Funeral Home with Wallace Hickman Jr. and Wallace Hickman Sr., worked as a general manager for SCI for 11 years. Hickman Sr. was a co-founder of Dorsey Funeral Home, acquired by SCI in 1994 and merged with E. Earl Smith & Son after SCI acquired it in 2000. “I decided to go into business myself with Mr. Hickman. We opened Palms West in 1996. Mr. Hickman and myself formed this place. We want to keep it that way. We have been offered to be bought several times by SCI,” Almeida said.

“I would like to say I provide better service. I am here at my location. I make sure things go the way they should go. At SCI they switch their staffing around to economize. Here people see the same faces,” Almeida said. Michael Bowden, president, Scobee-Combs-Bowden, Boynton Beach, said of SCI, “They have good people who work for them. It is not the same as dealing with people who own it and are part of the community. Wall Street runs those places. My wife and I run this one.”

 

 

The Funeral Rule

The Funeral Rule, enforced by the Federal Trade Commission, requires funeral directors to give you an itemized price list in person, and if you ask, over the phone.

The Funeral Rule says:

  • You have the right to choose the funeral goods and services you want (with some exceptions).

  • Funeral providers are allowed to charge a basic services fee that customers cannot decline to pay.

  • The funeral provider may not refuse, or charge a fee, to handle a casket you bought elsewhere.

  • A funeral providre that offers cremations must make alternative containers available.

  • The FTC advises shoping around in advance. Compare prices from at least two funeral homes. Remember you can supply your own casket or urn.

  • Resist pressure to buy goods and services you don’t really want or need.

  • Avoid emotional overspending. The fanciest casket or most elaborate funeral is not necessary.

  • Plan Ahead. It allows you to comparison shop without time constraints, creates an opportunity for family discussion, and lifts some of the burden from your family.

 

 


Source: ftc.gov


The Florida Division of Funeral, Cemetery and Consumer Services can assist consumers with questions or complaints. You can contact the division at 850-413-3039, or Toll Free in Florida at 800-323-2627.


To file a complaint online, go to myfloridacfo.com/FuneralCemetery.


The average cost of a funeral in 2012 was $7,045, not including a burial vault, cemetery or crematory charges, flowers or obituaries. Including a vault, the average was $8,343. Over the last decade, the average cost has increased 35 percent. Cremations are climbing at the rate almost 2 percent a year. In 2012, 175,849 people died in Florida, and 61 percent were cremated. In 2007, 53 percent were cremated. In the U.S. in 2012, 43 percent of people were cremated. The U.S. death rate stood at eight per 1,000 population in 2011, and rose to 8.3 in 2012. By 2035 it is projected at 9.3.


Sources: Cremation Association of North America, National Funeral Directors Association

View the original article here.

By Susan Salisbury - Palm Beach Post Staff Writer

 

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