Funeral homes unhurt by recession, but more people are economizing

Local funeral home operators say they expect business to grow in coming years despite the recession, but people are cutting back on some funeral spending.

Three local operators said they have not had to lay off employees. The three are Gary Morgan, owner of Rivers-Morgan Funeral Home in New Bern, Patrick Bryant, owner of Bryant Funeral Home and Crematory in Alliance, and Sam Altman, manager of Cotton Funeral Home in New Bern. Altman is also regional manager of Keystone Corporation, which has two funeral homes in Onslow County-one in Jacksonville and one in Richlands.

According to the national Funeral Directors Association, funeral services are an $11 billion industry in the United States, and if projections stay on track, the business will only grow.

The association projects that the U.S. death rate will increase from eight people per thousand in 2008 to 9.3 per thousand in 2020 and 10.9 per thousand in 2040, as baby boomers die in growing numbers.

Altman said a recent study suggests that 2012 will be a big year for the funeral business. "Korean and Vietnam war veterans' deaths are expected to grow," he said, while the number of deaths of World War II veterans will dwindle from the current rate of about 2,000 a day.

While there is a customer base for the funeral industry, customers are cutting back in some ways.

A cremation is the less expensive way to go. The average price of a cremation without attendant rites or ceremonies is $1,200.

Bryant said cremations now account for at least one-third of his business. "Pamlico County has a growing population of retirees from the North," he said. "It is a more common practice from that part of the country to be cremated."

Altman said cremation requests have risen at Cotten Funeral Home. He also said some customers are buying less-expensive merchandise instead of the top-end offerings.

Morgan said his business has had a slight increase in cremations "but more people are asking about it."

The three all said that some people are cutting back on extras, such as flowers, family cars and printed programs. Some people are holding visitations at their homes instead of the funeral chapel.

Altman said some people are opting for a graveside service instead of the traditional chapel and graveside service.

All funeral businesses are required to give customers a price list of services.

Bryant said the hearse is a $95,000 investment. "Some families are cutting back on family cars, but the hearse is a necessary part of the funeral service," he said.

"Funeral directors have to be penny-wise," Bryant said.

Embalming is not required by state law. The price tag for embalming is about $500. However, if the person had a communicable disease and a viewing by the public is desired by the family, the body is embalmed because of the danger of spreading the disease, according to Bryant. He said people can forgo embalming if there is no viewing by other than family members or if families request an immediate burial with no public viewing.

Funeral prices vary, but in this area, a complete funeral can range from $3,500 to $6,500 and up.

The funeral homes have packages for the family to select or packages that people can select for themselves in advance.

The three said making arrangements in advance goes a long way to prevent financial anguish for those left behind.

The packages offer certain services for a fixed price. Those who plan and prepay for the type of burial they want get prices locked in.

Altman said that if the state or county increases fees, for documents such as death certificates or sales tax increases, the family pays only that increase.

He said the money is put in a trust within five days and the funeral home cannot touch it..

The men said that customer service is the key to staying in business.

Morgan said he is straightforward with families who come to his business and he wants them to be sure that they understand what services they are getting and paying for.

Many people use a life insurance policy, often called a "burial policy." Morgan said that if the policy is for $5,000 he provides a dignified and professional service. "We will not eat the entire policy up and try to give some money back," he said.

All three operators said customer service is important.

"Children are devastated and often buy more because of guilt," Bryant said. "I consulted with them. That is why it is so important for the person to plan their own burial. No one knows more what they want than the person for whom the service is for."

Part of Bryant's marketing is speaking with school, civic, church and retirement centers.

"I hug the ladies when they leave; I tell them, don't call the secretary, call me," he said.

"Remember, we are talking to people who could be spending $5,000 to $10,000 in 30 minutes. They need to be educated and prepared," Bryant said.

"The recession doesn't affect the funeral business," Bryant said. "The death bell is going to ring whether it is Sunday or a holiday."