There are four types of funeral business:
Long established, independent family firms.
Members of small or medium-size groups of funeral directors, including regional Co-operative societies.
Members of big conglomerates, eg, Dignity Caring Funerals and Co-operative Funeralcare.
First generation sole traders.
Presently, 60% of funeral homes (1 and 4) are independent ‘boutique’ businesses and 40% are consolidated: they belong to a group or chain. The funerals business is unusual in that so much of it remains in the hands of sole traders. In most businesses consolidation leads to operational efficiencies and economies of scale yielding lower costs and a cheaper product. This enables a consolidated business to undercut its competitors and drive them out of business – hey Tesco.
This has not happened in the funeral industry, whether through greed or incompetence. The consolidated businesses are among the most expensive and they compete badly on customer service. This doesn’t bother them especially because there is very little consumer scrutiny of the funeral industry and most people buy a funeral with fogged brains and low expectations. They don’t know any better.
A funeral home, however good, cannot stimulate an appetite for its product, neither can it inspire repeat business—it cannot encourage more people to die, nor can it encourage them to die more than once. It can only get bigger by ceaselessly devouring its rivals. A good small business remains small because it wants to.