Is Pet Death Care in your future?
Morgan Stanley equity analyst Simeon Gutman recently made this comment in this white paper from Morgan Stanley, “Americans are increasingly attached to their pets, which is clearly shown in survey results, and thus pet spending is a priority. Consumers are less willing to cut pet spending even when real personal disposable income declines.”
And, just last month in the state of Georgia, Wal-Mart, according to this article, opened “. . the first-ever Walmart Pet Services center.” According to the article, WalMart Pet Services will offer, “low, transparent pricing for key pet services in a central location with a dedicated store front.”
It’s also interesting to know that, according to the Morgan Stanley article, the expected spending on pet care over the next decade will increase by 134% from national spending in 2019 of $118 billion to approximately $277 billion by 2030.
Funeral Director Daily take: While not specifically brought up in these articles I think that there is a question here for those that operate human death care facilities. That question is “Do I use my expertise in death care to enter the pet death care market?”
From my point of view, I think that is a question worth considering as you move forward with your operations. You can simply look at the numbers — Death Care in the United States is said to do somewhere between $22 and $25 billion in total revenues in a year. Service Corporation International (SCI) is the largest death care provider in the country and by death volumes appears to have about a 12% market share in the country — SCI services about one out of every eight U.S. deaths. Their total revenues, which are transparent because they are a public company, are slightly over $4 billion. Using that number and the 12% market share extrapolates to a total death care revenue volume in the United States of about $32 billion. . . . more than other estimates but that is still much less than pet care revenues of $277 billion.
So, I think the opportunity in spending from the American consumer is there for pet death care and memorialization in larger numbers than is being done today. Take a look in Australia where the largest death care provider, InvoCare, has made a concerted effort to also capture the pet death care market. According to their 2022 Annual Report, which you can access here, their “Pet Cremation” revenue for 2022 was about $AUS 35.1 ($US 22.3 Million) million as compared to 2021’s revenue number of $AUS 29.6 million ($US 18.9) . . . a yearly increase of 18.7%.
Again, from the InvoCare report, it appears they derived that revenue from 16 facilities located over five Australian states. On a per location basis that works out to $US 1.4 million in revenue per location. My guess is that most American funeral homes do less than $1.4 million per location.
It’s also interesting that one of InvoCare’s Four Strategic Pillars mentioned in their annual report is “Expanding the addressable market thru adjacencies”. They specifically recognize that pet death care is “adjacent” to their human death care operations.
It’s also apparent that the idea of operating a Pet Death Care Center of some type may very well depend on the demographics of your area. The volume numbers you might need for profitability would seem to me to be there in the large urban markets much more so than in the rural markets.
In either case, however, a pet services operation, even if not highly profitable may be able to serve as a “Customer Acquisition” channel in many cases. It’s highly likely that a family has multiple pet deaths before needing a funeral home to help them for a human death. If they have been treated right and fair for a pet’s death, it is also highly likely that they would turn to that same funeral home for a human death.
This is all good information. The more facts you have the better prepared you will be to make a decision on this point going forward. Like all decisions, a funeral home owner or manager needs to look at the opportunities from all sides before making a decision on what to do.
Good luck with your planning.
More news from the world of Death Care:
- This is what funerals and the afterlife will be like in 2050. The Daily Mail (Great Britain)
- The option of natural organic reduction for burial. Olean Times Herald (NY)
- Speaking candidly to loved ones about funeral planning — five tips. The Money Pages (Great Britain)
- Las Vegas pet parents question what remains they have after crematory alerts them to issues. Yahoo News
- Breaking ground on a new funeral home: Crematory, morgue among additions. Oelwein Daily Register (IA)
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