Five Reasons Why 2025 is the Year to Sell Your Funeral Home
With many changes coming to both the funeral industry and the US economy, 2025 is shaping up to be a positive year for funeral home sales and succession planning. Of these changes, five stand out as the biggest reasons why 2025 is the year to sell your funeral home:
1. Post-Pandemic Recovery and Economic Stabilization
The pandemic impacted many professions, but now most of them, including funeral services, are returning to some normalcy. There are still challenges that might be with us to stay, but most have learned from the last few years and been able to adapt. With the economy recovering and easier access to financing, you may find that buyers are more willing and able to invest in funeral homes. This stability and growth should lead to an increase in buyer’s interest this year and can allow you to benefit from a favorable market in 2025.
2. Lower-Cost Alternatives Are on the Rise
The funeral industry is evolving, with families increasingly opting for lower-cost alternatives or less services. These trends could impact your market share and reduce the value of the business you’ve worked hard to build.
- Cremation Services: According to the National Funeral Directors Association (NFDA), the US cremation rate is expected to top 80% by 2045. As cremation rates continue to rise, higher-priced traditional burial services are seeing a decrease in demand across the nation.
- Discount Providers and Online Services: The rise of online services and discount funeral providers could increasingly challenge traditional funeral homes. Buyers monitoring these trends can see your business’s strong financials now and act before these changes begin to take a more significant toll on your market share.
As a succession planning company exclusively working in the funeral industry, we’ve seen valuations for the same business decline over the last 10 years. Selling your funeral home now allows you to secure the full value of your business today, protecting your financial future and ensuring a comfortable retirement, regardless of market changes.
3. More Funeral Home Owners Are Reaching Retirement Age
According to a 2023 survey of NFDA members, nearly half of funeral home owners plan to retire within the next five years; however, less than a quarter say they have a succession plan in place. If you’re nearing retirement age, you might be wondering when the ideal time to sell your funeral home is.
In our experience, when an owner is ready to hand in the keys and head to the beach, it’s too late to get full value for the business. Most buyers value a business for its standing in the community, and a lot of that is due to the owner’s relationships and drive. When a funeral home owner leaves suddenly, the value from their relationships with their community is lost.
Considering this, the ideal time to sell is two to three years before retirement. From there, owners can work a reduced schedule and eventually retire with a well-prepared team to take over. Furthermore, with the likely increase in the number of sellers over the next 5 years, it will be advantageous to consider selling now to reduce the risk of the over supply of sellers negatively impacting values.
4. New Buyers Entering the Profession
With the post-pandemic economic recovery, the funeral industry has seen interest from new buyers and investors who are eager to enter the profession. Our team is in contact with these prospective buyers who are seeking to purchase established businesses like yours. These buyers often bring fresh perspectives, capital, and resources, which can make them more motivated to close deals quickly and on favorable terms. The influx of new buyers could drive up demand, allowing you to secure full value for your funeral home.
However, as funeral succession planning advisors for over 20 years, we’ve seen some new buyers enter the market, only to have lost value and destroyed businesses. It’s important to work with an advisor like NewBridge to make sure that you’re aware of the potential risks of any newer buyers out there.
5. A Growing National Focus on Work/Life Balance
Owning a funeral home is a demanding and emotional responsibility. Many funeral home owners have dedicated decades of hard work—sacrificing personal time, nights, and weekends to grow and sustain their businesses. While this dedication is crucial to the success of the business, it’s equally important to recognize when it’s time to step back and focus on what matters most. To improve their work/life balance, many sellers stay on after a sale and let the buyer handle legal, accounting, recruiting, or employee management, while focusing on providing the best services to their community and working a reduced schedule. As funeral home owners join other professions in striving for a better work life balance, the NewBridge group is here to help you navigate your options to achieving this.
Transition Planning with NewBridge
NewBridge Group will work with you and a prospective buyer to develop a comprehensive transition plan that outlines the timeline, responsibilities, and milestones for the transfer of ownership. Clear communication and collaboration between the seller and buyer are essential to ensure a seamless transition and minimize disruptions to business operations.
Preparing your funeral home for sale requires careful planning, expertise, and collaboration with experienced professionals like NewBridge Group. With our industry knowledge and specialized services, we can help you navigate the complexities of selling your funeral home and achieve a successful outcome. We believe we know all of the active national and regional funeral home buyers (public and private) in the market today. Contact us today to learn more about how we can assist you in preparing your funeral home for sale.