Funeral Home Business Plan Template
If you want to start a traditional funeral home or expand your current funeral home business, you need a well-crafted business plan.
The following funeral home business plan gives you the key elements for writing your own comprehensive business plan.
Sample Funeral Home Business Plan
I. Executive Summary
Business Overview
[Company Name] is a full-service funeral home based in [location], offering funeral, cremation, and burial services to people of all faiths.
Services
[Company Name] offers a full range of funeral services, including:
- Cremation services
- Funeral arrangements
- Memorial services
- Body preparation and interment
- Transportation
- Selling funeral merchandise (e.g., caskets, flowers, and memorial stationery)
Customer Focus
[Company Name] will serve the community of [location], offering both pre-need and current need clients. The demographics of the target customer profile is as follows:
- 52,313 residents
- Average income of $65,000
- Median age: 38 years
Management Team
[Company Name] is led by [Founder’s Name] who has worked as a mortician since his graduation from university. He has worked in increasingly responsible roles with some of the largest traditional funeral homes in the state. As a result, [Founder] has an in-depth knowledge of both morgue operation, as well as client-facing service, bringing a working knowledge of both the technical (e.g., running day-to-day operations) and the business management side (e.g., staffing, marketing, etc.) of funeral homes.
Success Factors
[Company Name] is qualified to succeed due to the following reasons:
- The company will fill a market need in the diverse community we serve. The market need we aim to meet is offering funeral services at a range of price points. The company has surveyed the local population and received highly positive feedback, with residents expressing high interest in having more options for personalized services.
- The Company is centrally located, with an elegant and functional facility, and park-like grounds.
- [Founder’s Name] has lived in [company location] all his life and has raised his family in the same community as the target market. He has many connections with the locals.
- The management team has a track record of success in the funeral home business.
Financial Highlights
[Company Name] is currently seeking $240,000 to start the company. Specifically, these funds will be used as follows:
- Facility design/buildout: $150,000
- Working capital: $90,000 to pay for marketing, salaries, equipment and lease costs until [Company Name] reaches break-even
Top line projections over the next five years are as follows:
| Financial Summary | FY 1 | FY 2 | FY 3 | FY 4 | FY 5 |
|---|---|---|---|---|---|
| Revenue | $560,401 | $782,152 | $1,069,331 | $1,379,434 | $1,699,644 |
| Total Expenses | $328,233 | $391,429 | $552,149 | $696,577 | $776,687 |
| EBITDA | $232,168 | $390,722 | $517,182 | $682,858 | $922,956 |
| Depreciation | $7,000 | $7,000 | $7,000 | $7,000 | $7,000 |
| EBIT | $225,168 | $383,722 | $510,182 | $675,858 | $915,956 |
| Interest | $6,016 | $5,264 | $4,512 | $3,760 | $3,008 |
| Pre Tax Income | $219,152 | $378,458 | $505,670 | $672,098 | $912,948 |
| Income Tax Expense | $76,703 | $132,460 | $176,985 | $235,234 | $319,532 |
| Net Income | $142,449 | $245,998 | $328,686 | $436,864 | $593,416 |
| Net Profit Margin | 25% | 31% | 31% | 32% | 35% |
II. Company Overview
Who is [Company Name]?
[Company Name], located at [insert location here], is a new, independent funeral home focusing on providing high-quality services to its clients.
[Company Name] is a family-owned and operated business that specializes in providing professional and compassionate services for clients of all financial means. While our founder, [Founder’s Name], has worked as a funeral director for some time, it was in [month, year] that he decided to launch [Company Name]. Specifically, during this time, [Founder] himself suffered the loss of his Father-in-Law, who lived in another state. The funeral home used for his Father-in-Law’s final celebration offered ingenious ways for bereaved families to honor their deceased, no matter their financial situation. After this dignified and comforting experience, and discussing the business at length with the owner, [Founder’s Name] clearly understood that a similar business would enjoy significant success in his hometown.
Specifically, the customer demographics were so similar to her hometown that he knew it would work. Furthermore, after surveying local residents, this theory was proven.
[Company Name]’s History
Upon returning from his Father-in-Law’s funeral, surveying the local customer base, and finding an ideal property, [Founder’s Name] incorporated [Company Name] as an S-Corporation on [date of incorporation].
Once the property and license has been acquired, and the facility construction is complete, all operations will be run from the property.
Since incorporation, the company has achieved the following milestones:
- Developed the company’s name, logo, and website
- Created the list of services to be offered
- Determined equipment and inventory requirements
- Began recruiting key employees with experience in the funeral home industry
[Company Name]’s Products
[Company Name] will be able to provide customers with high-quality services, which includes:
- Cremation services
- Funeral arrangements
- Memorial services
- Body preparation and interment
- Transportation
- Selling funeral merchandise (e.g., caskets, flowers, and memorial stationery)
III. Industry Analysis
[Company Name] directly or indirectly competes with other funeral homes. There are nearly 29,000 funeral homes in the United States. According to a report by the National Funeral Directors Association, the overall funeral service industry is extremely fragmented. It reports the majority of funeral home operators are small, locally owned, independent operations serving customers that live within 10.0 to 15.0 miles of the property’s location.. The total funeral homes market is estimated to grow to over $16 billion in the next five years. This growth bodes well for [Company Name]; since there are few elegantly affordable options in [location], and a local start-up can expect to have the advantage in the local market. There is plenty of room in the industry, provided the funeral home maintains a good reputation, and ensures effective cost controls.
Demand for the funeral industry has been steady because industry services are nondiscretionary. Despite trends toward lower-cost cremations, this industry remains the default option for end of life preferences.
IV. Customer Analysis
Demographic Profile of Target Market
[Company Name] will serve the local community of [company location] and its surrounding areas. It will offer its services to the family members of the deceased. It is safe to say that the target market for funeral home services cuts across people of all classes, races, religions, and cultures.
The precise demographics of the town in which the business is located is as follows:
| Wilmette | Winnetka | |
|---|---|---|
| Total Population | 26,097 | 10,725 |
| Square Miles | 6.89 | 3.96 |
| Population Density | 3,789.20 | 2,710.80 |
| Population Male | 48.04% | 48.84% |
| Population Female | 51.96% | 51.16% |
| Target Population by Age Group | ||
| Age 18-24 | 3.68% | 3.52% |
| Age 25-34 | 5.22% | 4.50% |
| Age 35-44 | 13.80% | 13.91% |
| Age 45-54 | 18.09% | 18.22% |
| Target Population by Income | ||
| Income $50,000 to $74,999 | 11.16% | 6.00% |
| Income $75,000 to $99,999 | 10.91% | 4.41% |
| Income $100,000 to $124,999 | 9.07% | 6.40% |
| Income $125,000 to $149,999 | 9.95% | 8.02% |
| Income $150,000 to $199,999 | 12.20% | 11.11% |
| Income $200,000 and Over | 32.48% | 54.99% |
Customer Segmentation
The Company will primarily target the following customer segments:
- Individuals aged 45 to 64 – This cohort accounts for approximately 20% of revenue for the industry. The mortality rate begins to rise significantly at this age, with cancer and heart disease the leading causes of death.
- Individuals aged 65 to 84 – This is by far the largest customer segment, due to the fact that the average life expectancy in the US of 78.6 years old.
- Individuals aged 85 and older – This segment accounts for over 31% of industry revenue.
V. Competitive Analysis
Direct & Indirect Competitors
Ridge Funeral Home
Ridge Funeral Home was established in 1963 to provide a first class African American funeral operation. From the beginning, first class facilities and professional service have been cornerstone philosophies of this business. Since the establishment of the Funeral Home, the company has been committed to innovations such as maintaining a Metropolitan Flower Car as part of its rolling stock, and introducing the first six-door limousine to the area. This second-generation family-owned and -operated business works to provide unique, meaningful, and fully affordable services from its three locations.
Brighton Funeral Home
Brighton Funeral Home is a family-owned and -operated funeral home offering a variety of different funeral, cremation, and burial services. The company serves people of all faiths, and offers services to fit all financial abilities. Brighton Funeral Home is a much smaller funeral home compared to the other homes in the area.
Perkins & Sons
Perkins & Sons is a family-owned and -operated funeral home providing a range of personalized funeral services for families in the area. It offers small and large chapels that provide privacy in comfortable surroundings. Further, the staff’s attention to detail ensures the best traditional or contemporary funeral services, all at a fair price.
Competitive Advantage
[Company Name] enjoys several advantages over its competitors. These advantages include:
- Management: The Company’s management team has xx years of business and marketing experience that allows them to market and serve customers in an improved and sophisticated manner than the competitors.
- Relationships: Having lived in the community for xx years, [Founder’s Name] knows all of the local leaders, media, and other influencers. As such, it will be relatively easy for [Company Name] to build brand awareness and an initial customer base.
- Quality products at affordable pricing: The Company will provide quality services at affordable pricing, as it has high-quality equipment and uses the latest techniques.
- Location: [Company Name] will be able to service the entire metropolitan area of [company location] and its surrounding areas.
VI. Marketing Plan
The [Company Name] Brand
[Company name] seeks to position itself as a responsive, compassionate competitor in the funeral home business. Customers can expect high-quality services in elegant surroundings with affordable prices.
The [Company Name] brand will focus on the Company’s unique value proposition:
- Providing dignified and professional services with compassion
- Good quality products (casket, flowers etc.)
- Quality services at affordable pricing
Promotions Strategy
[Company Name] expects its target market to be the family members of the deceased. The Company’s targeted marketing campaigns include:
Advertisement
Advertisements in print publications like newspapers, magazines, etc., are an excellent way for businesses to connect with their audience. The Company will advertise its company offerings in popular magazines and news dailies. Obtaining relevant placements in industry magazines and journals will also help in increasing brand visibility.
Social Media Marketing
Social media is one of the most cost-effective and practical marketing methods for improving brand visibility. The Company will use social media to disseminate announcements and to provide an outlet for expressions of sympathy for the bereaved.
Yellow Page Marketing
The Company shall announce details about its presence and services in the yellow pages and other local directories to keep readers informed about the company’s various products.
Pricing Strategy
[Company Name]’s pricing will be moderate, so customers feel they receive great value when engaging the services it offers. The customer can expect to receive exceptional services at a far more affordable price than what they pay at the typical funeral home.
VII. Operations Plan
Functional Roles
To execute on [Company Name]’s business model, the company needs to perform several functions, including the following:
Service and Administrative Functions
Milestones
[Company Name] expects to achieve the following milestones in the following [] months:
| Date | Milestone |
|---|---|
| [Date 1] | Finalize lease agreement |
| [Date 2] | Design and build out [Company Name] |
| [Date 3] | Hire and train initial staff |
| [Date 4] | Kickoff of promotional campaign |
| [Date 5] | Launch [Company Name] |
| [Date 6] | Reach break-even |
VIII. Management Team
Management Team Members
[Company Name]’s most valuable asset is the expertise and experience of its founder, [Founder’s Name]. [Founder’s Name] has worked as a mortician since his graduation from university. He has worked in increasingly responsible roles with some of the largest funeral homes in the state. As a result, [Founder] has an in-depth knowledge of both morgue operation, as well as client-facing service, bringing a working knowledge of both the technical (e.g., running day-to-day operations) and the business management side (e.g., staffing, marketing, etc.) of funeral homes.
Hiring Plan
[Founder] will serve as the CEO. To launch the funeral home, the company will need to hire the following personnel:
- Funeral Director
- Administrative Manager
- Bookkeeper
- Undertaker
IX. Financial Plan
Revenue and Cost Drivers
[Company Name]’s revenues will come from the funeral products and services offered to the customers. The major costs for the company will be the cost of the equipment. The staff will earn competitive salaries allowing [Company Name] to hire experienced workers. In the initial years, the company’s marketing spend will be high, as it establishes itself in the market. Moreover, rent for the prime location is also one of the notable cost drivers for the [Company Name].
Capital Requirements and Use of Funds
[Company Name] is currently seeking $240,000 to launch its company. The capital will be used for funding capital expenditures and location build-out, hiring initial employees, marketing expenses, and working capital.
Specifically, these funds will be used as follows:
- Facility design/buildout: $150,000
- Working capital: $90,000 to pay for marketing, salaries, equipment and lease costs until [Company Name] reaches break-even
Financial Statements
5 Year Annual Income Statement
| Year 1 | Year 2 | Year 3 | Year 4 | Year 5 | ||
|---|---|---|---|---|---|---|
| Revenues | ||||||
| Product/Service A | $151,200 | $333,396 | $367,569 | $405,245 | $446,783 | |
| Product/Service B | $100,800 | $222,264 | $245,046 | $270,163 | $297,855 | |
| Total Revenues | $252,000 | $555,660 | $612,615 | $675,408 | $744,638 | |
| Expenses & Costs | ||||||
| Cost of goods sold | $57,960 | $122,245 | $122,523 | $128,328 | $134,035 | |
| Lease | $60,000 | $61,500 | $63,038 | $64,613 | $66,229 | |
| Marketing | $20,000 | $25,000 | $25,000 | $25,000 | $25,000 | |
| Salaries | $133,890 | $204,030 | $224,943 | $236,190 | $248,000 | |
| Other Expenses | $3,500 | $4,000 | $4,500 | $5,000 | $5,500 | |
| Total Expenses & Costs | $271,850 | $412,775 | $435,504 | $454,131 | $473,263 | |
| EBITDA | ($19,850) | $142,885 | $177,112 | $221,277 | $271,374 | |
| Depreciation | $36,960 | $36,960 | $36,960 | $36,960 | $36,960 | |
| EBIT | ($56,810) | $105,925 | $140,152 | $184,317 | $234,414 | |
| Interest | $23,621 | $20,668 | $17,716 | $14,763 | $11,810 | |
| PRETAX INCOME | ($80,431) | $85,257 | $122,436 | $169,554 | $222,604 | |
| Net Operating Loss | ($80,431) | ($80,431) | $0 | $0 | $0 | |
| Income Tax Expense | $0 | $1,689 | $42,853 | $59,344 | $77,911 | |
| NET INCOME | ($80,431) | $83,568 | $79,583 | $110,210 | $144,693 | |
| Net Profit Margin (%) | - | 15.00% | 13.00% | 16.30% | 19.40% |
5 Year Annual Balance Sheet
| Year 1 | Year 2 | Year 3 | Year 4 | Year 5 | ||
|---|---|---|---|---|---|---|
| ASSETS | ||||||
| Cash | $16,710 | $90,188 | $158,957 | $258,570 | $392,389 | |
| Accounts receivable | $0 | $0 | $0 | $0 | $0 | |
| Inventory | $21,000 | $23,153 | $25,526 | $28,142 | $31,027 | |
| Total Current Assets | $37,710 | $113,340 | $184,482 | $286,712 | $423,416 | |
| Fixed assets | $246,450 | $246,450 | $246,450 | $246,450 | $246,450 | |
| Depreciation | $36,960 | $73,920 | $110,880 | $147,840 | $184,800 | |
| Net fixed assets | $209,490 | $172,530 | $135,570 | $98,610 | $61,650 | |
| TOTAL ASSETS | $247,200 | $285,870 | $320,052 | $385,322 | $485,066 | |
| LIABILITIES & EQUITY | ||||||
| Debt | $317,971 | $272,546 | $227,122 | $181,698 | $136,273 | |
| Accounts payable | $9,660 | $10,187 | $10,210 | $10,694 | $11,170 | |
| Total Liabilities | $327,631 | $282,733 | $237,332 | $192,391 | $147,443 | |
| Share Capital | $0 | $0 | $0 | $0 | $0 | |
| Retained earnings | ($80,431) | $3,137 | $82,720 | $192,930 | $337,623 | |
| Total Equity | ($80,431) | $3,137 | $82,720 | $192,930 | $337,623 | |
| TOTAL LIABILITIES & EQUITY | $247,200 | $285,870 | $320,052 | $385,322 | $485,066 |
5 Year Annual Cash Flow Statement
| Year 1 | Year 2 | Year 3 | Year 4 | Year 5 | |
|---|---|---|---|---|---|
| CASH FLOW FROM OPERATIONS | |||||
| Net Income (Loss) | ($80,431) | $83,568 | $79,583 | $110,210 | $144,693 |
| Change in working capital | ($11,340) | ($1,625) | ($2,350) | ($2,133) | ($2,409) |
| Depreciation | $36,960 | $36,960 | $36,960 | $36,960 | $36,960 |
| Net Cash Flow from Operations | ($54,811) | $118,902 | $114,193 | $145,037 | $179,244 |
| CASH FLOW FROM INVESTMENTS | |||||
| Investment | ($246,450) | $0 | $0 | $0 | $0 |
| Net Cash Flow from Investments | ($246,450) | $0 | $0 | $0 | $0 |
| CASH FLOW FROM FINANCING | |||||
| Cash from equity | $0 | $0 | $0 | $0 | $0 |
| Cash from debt | $317,971 | ($45,424) | ($45,424) | ($45,424) | ($45,424) |
| Net Cash Flow from Financing | $317,971 | ($45,424) | ($45,424) | ($45,424) | ($45,424) |
| SUMMARY | |||||
| Net Cash Flow | $16,710 | $73,478 | $68,769 | $99,613 | $133,819 |
| Cash at Beginning of Period | $0 | $16,710 | $90,188 | $158,957 | $258,570 |
| Cash at End of Period | $16,710 | $90,188 | $158,957 | $258,570 | $392,389 |
