OLR Research Report

October 7, 2003 98-R-0480

FROM: Chelsea Turner, Legislative Fellow

RE: Corporate Growth in Funeral Home Industry

You requested information on the growth of corporate ownership in the funeral home industry and the cost of funeral home prices.


Chain funeral home corporations have existed since the 1960s; only in recent years has their presence grown substantially. Three large corporations now own 15% of the 23,000 homes in the funeral home industry. Service Corporation International (SCI), based in Houston, is the largest of the three, followed by Loewen Group Inc., based in Vancouver, Canada and Philadelphia, and Stewart Enterprises Inc., based in New Orleans. Approximately 1 of every 5 funerals in the U.S. is conducted by one of the three.

In 1996, the average cost of a single funeral service was $4,782. This is based on information acquired from General Price Lists. A General Price List is a list of funeral services and items that each funeral home provides. Under the Federal Trade Commission's Funeral Rule, adopted in 1984, funeral homes are required to provide consumers with these lists.

The corporate acquisition cost for an actual funeral home depends on many factors, such as size and location.


Chain funeral homes do not change the name after buyout. As a result, presence of chains in the industry is somewhat veiled. In addition to purchasing funeral homes, chains are also buying cemeteries and crematoriums. In some areas, a chain may own all or the majority of death care services which gives the chain the advantage of “clustering” their services. “Clustering” maximizes operational efficiency since limousine services, embalming services, support staff, and building expenses may be shared.

Shareholder gains appear to be climbing alongside profit gains. Stocks appear attractive. There is a fund, the Pauze Tombstone Fund, which is comprised solely of funeral home industry stocks. Table 1 provides a snapshot look at the five largest funeral home industry companies.

Table 1: Five Largest Funeral Home Companies



Gross Profit







Service Corp Intl:


604 million

2.3 billion




Loewen Group Inc:


337 million

908 million




Stewart Enterprises Inc:


157 million

533 million




Equity Corp Intl:


26 million

92 million




Carriage Services Inc:


7 million

55 million




Source: annual reports.

A feel for the significant growth in the industry can be attained from looking at the annual reports. Statements include:

● “From the end of 1992 through 1996, our annual revenues grew from $772.5 million to . . . 2.3 billion, and the number of SCI funeral service locations, cemeteries, and crematoria grew from 925 to 3,377” (SCI, 1996 Annual Report).

● “In the 10 years since its initial public offering, the company has grown from owning 47 funeral homes and one cemetery to its position today of owning and operating over 1,000 funeral homes, 500 cemeteries and 50 crematoria. The Company has experienced a compounded growth rate over nine years of 49% in revenues and 43% in earnings before interest and taxes” (Loewen Group Inc., 1996 Annual Report).

● Earnings per common share rose from $1.11 in 1996 to $1.46 in 1997 (Stewart Enterprise Inc., 1997 Annual Report).

● “The company's net revenues increased by 43.7% to $92.0 million from $64.0 million in 1995” (Equity Corp. Intl., 1996 Annual Report).

● “The company formed in 1991 in order to take advantage of the attractive fundamentals and significant opportunities to consolidate the death care industry . . . The Company significantly expanded its corporate development and acquisition activities in 1996 and early 1997” (Carriage Services Inc., 1996 Annual Report).


In 1995 and 1996, the average cost of a single funeral service rose proportionately with inflation. Over the last five years, the total price has increased by 12%. In 1996, the average cost of a single funeral service was $4,782. Table 2 provides a breakdown of the cost of an individual funeral home service.

Table 2: Funeral Price Information for 1996

Most Commonly Selected Items
Average Cost

1. Non-declinable professional service charges


2. Embalming

$ 369.51

3. Other preparation (cosmetology, hair, etc.)

$ 132.92

4. Visitation/viewing

$ 304.84

5. Funeral at funeral home

$ 325.73

6. Transfer of remains to funeral home

$ 134.17

7. Hearse (local)

$ 161.24

8. Service Car/Van

$ 80.76

9. Acknowledgement cards

$ 18.74



10. Casket, 18 gauge steel, sealer, velvet interior


Total with Casket:


11. Vault, asphalt coated concrete, sealer

$ 760.79

Total with Casket & Vault:


Source: National Funeral Directors Association's General 1997 Price List Survey.

Recent news articles highlight the corporate presence and increasing costs of their funeral services (March 23, 1998, U.S. News and World Report; August 29, 1997, Washington Post). The Post article made an analogy of the corporate growth in funeral homes to the corporate growth of pharmaceutical companies but explained that the difference in the funeral home industry is that consumers are not benefiting from a reduction in cost. The chains' response is that the level of professionalism within the industry has been enhanced by their presence, and if there is a significant price difference between one of their homes and an independently owned home, it is an isolated incidence.

The cost to a corporation for buying an actual funeral home depends on many factors such as size and location of the home.