Just the tip:
I’m sure I have said it a couple times now, but I’m a nurse and have worked in healthcare for the last 15 years or so. About a decade, I’m working as a nurse and we were trying to figure out what to do with a dead body at the hospital. The family didn’t have the money and refused to do anything with the body. That lead us down a rabbit hole of looking into cremation services and other low cost options. Well, in case you’re wondering the lowest cost dead body solution is forcing the city do deal with it, or donating the body to science.
Why I wouldn’t donate my body to science. Back in a high school forensics class, we learned about a place called a “body farm” who does all sorts of science experiments on dead bodies. They put a dead body in the trunk of a car and leave it out in the sun for a week. Then they would check on its decomposition over time. They do the same but with a body wrapped in plastic in a trunk and see its decomposition over time. This kind of crap is probably useful to humanity somehow…but its not for me. The other thing that happens with donated bodies is stuff like companies sell off body parts for practicing surgeries. I remember an orthopedic surgeon that asked me to open up the morgue for him so he could put a leg in there. A leg? Yep, he bought a donated leg and then practiced a new surgery technique to expand his skills. Probably a good thing…but its not for me.
So where the hell am I going with this? Cremation is the answer. Cremation is the most affordable service you can pay for to dispose of a body. Back when we were looking into this for work (not for business) the best price we could find in the Dallas area was about $750 to cremate a body. This is a direct to crematory service, where the crematorium drives their VW van and picks up the body directly from the hospital or coroners office, and straight to the incinerator. Go directly to the fire box, do not pass go, do not collect $200. With the baby boomer generation getting to the end of life, this business is going to be booming! haha…you get it? Ok, jokes aside, this industry really will pick up. Check out the chart below. Expensive burials are becoming less and less popular (as it should be..its insane to spend $20k to put someone in the ground). With cremation expected to be 70% by 2030, and the US Census Bureau is expecting 3 million deaths per year by 2030. There is ample opportunity for this industry. It’s kinda creepy, but if you’re in healthcare, a dead body is a dead body. Just another day.
Quick Thoughts:
Cost to get started: [$$$]This is a THREE $ ($$$,000) business to get started. Its going to cost a couple hundred thousand to get started but it will be in the very low hundreds to get started. A crematory is about $40k. Outside of that, you need real estate and a used van.
Ease of business: [2] – I really don’t feel this is that complicated. The hardest part of this all is probably the licensing involved which will vary by state. But realistically, this is a needed service so outside of some good old boy system of licensing, it shouldn’t be hard.
How big can this grow: [4] I think this could easily be a million or two a year in revenue with minimal labor costs.
Resource level: [2] It shouldn’t really take too much to get this up and going. Some real estate in a zoned area (or do something in the country so city zoning and nonsense doesn’t stop you) and a crematory license. Texas license doesn’t seem difficult outside being certified by some reputable organization.
Can I pull it off: [5]: I think this is one that should be fairly easy to pull off, so I give it a 5. Easy.
Why This and Where is It Going?
So we kind of discussed this in the beginning. I think this business is going to grow rapidly for years to come. With our society going to hell, less people caring about expensive funerals, people are broke and cant save for any emergency…affordable burial/cremation services are going to be needed. The largest generation is getting to the end of the road and we will be faced with exorbitant healthcare costs and nursing home bills, followed by post mortem expenses. This business has to grow exponentially over the next few years.
Lets Talk Financials:
So the most expensive part of this will be any sort of real estate to get started. I have a feeling lots of existing landlords aren’t going to be that keen on running a dead people business out of their rented buildings. I feel (but could be wrong) that this would likely need to be on an owner occupied building. With direct to burial services only, you don’t need anything fancy. I think for $150-200k you can get a small space. A temperature controlled walk in cooler is a good idea as well and will add to the cost.
So how much does it cost? Well, it seems like most crematories are in the $40-50k range unless you want the XL version (which may be smart as people are getting bigger and bigger). The cost of the actual cremation is cheap. According to some funeral equipment site I found it said the average person takes 20-30 therm of natural gas to completely cremate. In Texas dollars is about $2 per therm (which is way up…used to be $1.1 in 2020) so its about $40-60 to cremate a body (used to be $25-30). Labor rates should be cheap as there is no special training really needed. Anyone can move a body. You need a particulate grinder which seems to run $10k ish. A used van and conversion to hold a stretcher? $20k?
So how much do you make? While I stated in the beginning it was $750 for the lowest cost cremation I could find…this was 7-8 years ago. Average is about $1500 now a days. Accord to this random website, there are 3400 crematoriums in the US. According to to the Census bureau from the link above, my eyeball estimate says we should expect about 2.6 million deaths in 2024. According to the chart above we will estimate it at 60% cremation. Divide that by 3400 registered crematoriums and you get about 468 cremations per place or an average of about $700k per place. You can be in the black in 1 year. Being in more densely populated areas and you should see more business.
How to Get Started:
I’d go down the licensing part first. Check the local laws. Here in Texas, the laws seem pretty easy. Joining some recognized association may be a little more difficult as I have a feeling this is a good old boy network. After that, purchase a property and some equipment. This is a pretty straight forward business. Distribution like every business is important, so plan ahead. I think contacting local funeral home and offering better pricing would be a start. I don’t think funeral homes will see you as a threat if you are only in the cremation service business. I’d also use a DBA name for the funeral homes and another name for the public site. I’d also hit up every nursing home, ltac, senior citizens center and hospital in the area. People love donuts. Also, don’t forget about pets. Pets are like children and people (like me) have paid to have pets cremated. According to some random twitter post I saw, Texas only has 3 crematoriums large enough to cremate a horse and it has the largest horse population in the US.
Final Thoughts
Looking over the business, I think there is a lot of opportunity. This seems like getting into the black year one is totally possible depending on your real estate costs. I don’t think many people would even expect to factor in their real estate as part of the numbers to get into the black to begin with. Distribution is the hardest part and I think there could be some creative ways like using social media. Its kinda morbid but if you can get the millennials to realize they are going to have to pay for their parents after they die, they might listen up. Hammer on about how expensive funerals are. Advertise all of these cremation diamonds and what not for keepsakes rather than a burial plot. Looking at SEMrush, the cremation keywords are not terribly hard with KDs in the 30-40s. I think this business is an old school business run by older people who have not embraced technology fully. I think simple SEO can bring a lot of business. Dominating local SEO should be much easier than the national keywords with KD in the 30-40s. This business will only grow. Imagine in 2030 when we have 3 millions deaths per year at a 70%. That’s 618/crematorium or about $1,000,000 in revenue. Labor costs and natural gas costs will knock you down to a clean $850k a year profit. Seems pretty solid to me. And by 2030, its pure profit. If you didn’t pay off your real estates, you’d be crazy. 2035 looks like a good year for the business. The average place should make $1.2million or so with inflation. And don’t forget..these are considered low to mid price cremations.
Come on baby light my fire.
The Doors
