You want to sell your funeral business? Then it is good to know what the takeover market in the field of funeral homes looks like. There are more funerals as more and more people are dying due to an aging population. The increasing pressure as well as the more specific wishes of the customer have been driving growth in the funeral business for years.
More deaths due to the gray wave and most recently COVID-19, but also trends are increasing the opportunities for this industry. The individual is more and more central, and as the taboo of "the last wish" disappears, we are also taking more open positions regarding death and the funeral.
There are many ways to value a business. A common method of expressing the value of a business is "a factor x gross annual profit." This factor is also called multiple and another designation for gross annual profit is EBITDA (Earnings Before Interest Taxes Depreciation and Amortization).
In business services - to which a funeral home belongs - an indicative range of EBITDA multiple of 4.6 to 5.5 is currently used, according to the Brookz Takeover Barometer. The average EBITDA multiple across all SME sectors is 4.90.
The valuation of a business is often the starting point for negotiations between buyer and seller. The outcome of these negotiations is the final sales price. So valuation and price are two different quantities. Besides valuation, the price is also determined by possible scarcity in the market, bargaining power of the parties, the strategic value of the business for the buyer and possible synergy effects for the buyer (cost savings, purchasing advantages).
Do the calculation
There are many start-ups in the industry every year, which also makes many businesses with only one person working visible. In times of crisis or in an aging wave, such as the one in which society is now trying to sustain itself, the demand for funeral homes is high.
In figures, the number of funeral homes in 2024 looked as follows(CBS):
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A number of trends and developments will inevitably cause changes over the next few years, but also offer funeral homes many growth and acquisition opportunities:
Diversity in society means diversity in funeral wishes. Various religious, cultural, as well as personal wishes are implemented in the farewell. Consequently, there are more and more funeral homes that offer room for a customer-worthy farewell, according to ABN Amro.
Whereas previously dying and burial were rather shunned, today it is fine to talk about them openly. Being a donor, religious beliefs and last wishes can even be recorded in advance in consultation with the funeral home. That death fraternizes was already known, but is something that is becoming increasingly visible in this society.
Not only crematoria are thinking more and more about sustainability, but people also want a natural funeral more often. Getting together with nature is a deep desire of many residents, which is why the number of natural cemeteries is increasing.
In addition to personal wishes and the desire to be one with nature, more and more methods are popping up. Funeral options such as burial and cremation are obsolete, as composting and cryomaking are on the rise. Whereas with composting, nature largely does the work, cryomation requires a specialized crematorium.
