Cost and Profitability of Funeral Homes
The median cost of a funeral is $7,360. As of 2018, there were over 19,000 funeral homes. A funeral home must have staff and facilities for planning services. The main revenue is from services and products for families. The average profit for a funeral home is between 6 and 7 percent. Profitability varies by location, competition, and services. The average margin is 20-25 percent.
Factors Affecting Profitability
A funeral home in the right area can potentially make thousands per year. It may take years to reach this level. Since the population is aging, demand is increasing. Factors affecting profitability include management style and business structure.
Startup Costs and Success Factors
Startup costs range from $150,000 to $300,000 for a small business. Ongoing success requires empathy, listening skills, and creativity from staff. With good business practices, owning a funeral home can be profitable. You need an appropriate location, quality service, and efficiency. Adding profit as a line item is the first step in pricing.