Acquisitions continue to be announced in the death care business. It seems that there are a lot of businesses where the ownership is ready to transition out of the profession and there is an ever growing number of neighbor, regional, and national providers of funeral and cremation care that are intent on getting larger.
In our opinion, not all acquisitions are good or beneficial to the continuing business. We believe that acquisitions can be positive to the bottom line when they:
- Can lower operating costs by combining with a neighbor or competitor
- Are in a demographically growing community
- Can blend in with other company funeral homes in the area to form clusters that can add services, build market share, and reduce cost
Foundation Partners Group announced this week in this press release an acquisition that we believe hits on all three of these notes. They announced that they had purchased the Accent Funeral Home in Meridian, Idaho, and mentioned in the release that the purchase will increase Foundation Partners Group footprint in the western Idaho/eastern Oregon to nine locations.
Accent was started in 1984 and you can view their current website here.
Foundation Partners Group, according to the release, is a leading provider of innovative funeral cemetery experiences and products. They operate funeral homes, cremation centers, and cemeteries in 19 states and announce in the press release that they are actively seeking to expand their presence throughout the United States.
Here is a map of Foundation Partners Group locations.
According to this website, Foundation Partners Group is at least partially owned by Access Holdings of Baltimore, Maryland.
Funeral Director Daily take: We believe that acquisitions like this prove that even the “bigger guys” in the industry are interested in all sizes of funeral homes and crematories, depending on the location. While one regional or national player in the funeral profession may not be interested in your property, that does not mean that the “strategic fit” is not appropriate for another player. If you are looking at transitioning out of the business this is why it makes sense to know your regional area colleagues and/or talk to someone in the mergers and acquisitions business who knows them all.
If you are a one roof shop it would not hurt to know what might be coming available in your area with retirements and other transitions of your colleagues in the area. Adding another location, while being able to use some economies of scale, can really add to the bottom line. And, if the trends continue with less revenue per case being the norm, an acquisition may allow you to stop the slide on margins.