How to Write a Funeral Home Business Plan

If you are looking to write a winning funeral home business plan in the competitive UK funeral sector, you have come to the right place. This guide will provide you with an overview of the different aspects of the sector as well as explore the requirements of business planning. 

A business plan is essential due to the highly competitive nature of the industry. You need a plan that takes these competitors into account but also outlines ways you will do things differently – how you’ll grow your idea into a profitable business even in the midst of market competition. This, in turn, can be used to find lenders who will finance your project with funeral home business loans. 

The funeral sector in the UK is worth around £2 billion and is made up of several different businesses, from funeral directors to crematoria and cemeteries. The sector is highly regulated and there are a number of different organisations that oversee the industry, such as the National Association of Funeral Directors (NAFD) and the Funeral Planning Authority (FPA).

When it comes to arranging a funeral, there are a number of different options available and the type of service that your customers choose will depend on personal preferences and budget. As someone planning their business, you need to consider whether you’ll offer burial, cremation or both. 

The most common option in the UK is a traditional funeral, which includes a coffin, a funeral service and a burial. However, there are also a number of alternative options available, such as cremation, green funerals and humanist funerals.

With around 600,000 deaths each year in the UK, there’s always work to be had for good funeral care services – but you’ll need to stand out from the crowd with good marketing, excellent customer service and empathy-driven services. 

Some funeral directors offer discounts if you pre-pay for your funeral or if you take out a funeral plan. All of these things must be considered and included in your business plan. 

Overview of a business plan

The finished plan will be the template you present to lenders and other interested parties, essentially using it to justify your ideas and show there’s a tangible business need for your new funeral home. Whether you’re buying an existing home and taking it over, or intend to start one from scratch, you’ll need a business plan that covers the main considerations of funeral care. These are, broadly speaking: 

• Executive Summary

The first section of your funeral home business plan should be the executive summary. This section should provide a brief overview of your business, including your business goals and objectives. It should also include a brief description of your target market and your competitive advantage.

Although the summary comes first, almost everyone writes it last because it relies on the findings in other parts of the plan. It is crucial, however, because many lenders will only review the summary and lose interest if it isn’t eye-catching. 

• Corporate history and experience

The next section of your funeral home business plan should be the company description. In this section, you will provide a more detailed description of your business, including your history in the funeral sector and how you’ll structure the business going forward. 

• Customers and market

You’ll need to highlight the landscape your business will be launched in – is it a crowded market, or are you going to offer something new to local people? If the nearest competitor is a car journey away, you may win new customers by simply being the most accessible funeral home. 

• Products and services

In a generic business plan, your products/services are broad. In funeral care, you’ll be mainly identifying what type of services you will offer in burial and cremation, as well as any added products like coffins, luxury car hire etc. You could also explore new trends such as eco-friendly burials. 

• Financial plan

This section of your funeral home business plan is crucial. It is, of course, the financial plan that projects costs and profits. We’d recommend working with an accountant to forecast a detailed description of your funeral home’s financial projections. 

• Marketing plan

The next section should be your marketing plan. In this section, you will need to detail your marketing strategy, including your target market, your marketing mix, and your marketing budget. Funeral home directors may think they don’t need to market as business ‘comes to them’ but in this competitive sector, you need to stand out. 

Why do I need a business plan for a funeral home?

Business plans are crucial for anyone buying a funeral home or starting one, as they outline the goals and methodology of the business. In essence, a well-crafted business plan is a template for how your business will progress. Most lenders in the market will only offer finance after they have scrutinised the plan – which is why it’s so important to get it right.

Here at Rangewell, our team of professional service experts are on hand to help you craft a better business plan. We will talk to you about your finance goals for the business, survey the lender’s market and then negotiate on your behalf to win the loan you need to get started. 

As we do that, we’ll also help you strengthen your application and general business planning. Get your funeral home business underway today with Rangewell’s finance experts. Get in touch below to start. 

Section-by-section guide to funeral home business planning

Click the links to jump to each section. 

1. Executive summary
2. Corporate history
3. Customers & market
4. Products & services
5. SWOT analysis
6. Financial objectives
7. Marketing plan

Executive summary

The executive summary is always read first but finished last. It is a recap of the other parts of your plan and is designed to summarise the contents and distil it to key points that have appeal to the reader. For most businesses, the executive summary is all that a lender or stakeholder will read – so you need to get it right and make sure it is compelling. 

A great way to make your summary compelling is to split it into a ‘problem, solution’ structure that clearly illustrates the gaps or challenges in the market and how your funeral business can overcome or fill them. 

Corporate history 

You’ll need to outline your corporate or employment history here to show why you’re choosing a funeral home business. In reality, you’re likely either already an employee at a home, or you’re already an owner and looking to buy another funeral director out. You should also list any plans you have for how the business will be structured once you have it, including any shareholders or partners. 

Customers & market

Your customers are almost always the family or friends of the deceased, though some funeral owners work in pre-paid plans with people who are planning their own deaths. In this part of your business plan you must discuss your customers and target market. 

You should also look at local competitors and split these down by independent funeral homes and corporate groups. Note how you’ll differ from them and what you may do to stand out and win customers against the larger competitors. 

What services do your competitors offer? How can you get ahead? If your closest local competitor is a small-scale independent funeral home specialising in low-cost funerals, would you be able to add value by creating a more luxurious service? By looking at the market itself, your local audience and your competitors you can begin to outline ways to grow. 

Products & services

Here you’ll list all of the products and services your funeral home business will provide. These are typically combined as a full funeral ceremony with car hire, casket and burial included in the cost – though this will vary depending on your offering and your customer’s preferences. 

Cremation is typically cheaper for the customer and is easier to arrange, but burials can soar in cost and be lucrative for you as a business owner. Deciding on how you want to concentrate your funeral offering is about blending burial and cremation into your services in a way that best complements your resources and financial goals. 

The more staff you have, the better standard of burial service you can provide – whilst smaller businesses may opt to solely cremate to best serve customers at scale. 

Additionally, you can also outline potential services or products you plan to launch, provided you can secure finance. As long as these costs are included in your financial projections, you will essentially demonstrate the need for an asset finance loan and the profitability it will generate. 

For example, if you were to show how adding an eco-friendly burial service would benefit the business and cost X amount, a lender is more likely to offer what you need. 

SWOT analysis

A Strengths, Weaknesses, Opportunities and Threats (SWOT) analysis is an optional inclusion but one that will help lenders believe in your brand. It shows that you’ve considered the various angles that will impact your business’ chances of success. These are: 

• Strengths of the business, such as your expertise as a funeral director, geographic location relative to churches or crematorium, fleet, staff etc. 
• Weaknesses such as equipment challenges, costs, affordability of funerals etc. 
• Opportunities to improve such as investing in new equipment, arranging collaborations with other businesses such as florists etc. 
• Threats to the business such as rival businesses, new developments nearby, changing customer preferences etc.  

Financial targets

Use an expert for this section – it will pay off. The financial projections part of a business plan is designed to showcase the potential profits of your business and to show you’ve considered the costs. An accountant or business planning professional can help with this – but essential you’ll map out the costs and approximate targets for earnings across the next few financial years. The main thing lenders want to see is that you’ve accommodated for repayments and will be able to make them on schedule. 

Marketing plan

Funeral homes need marketing as much as any other business. While you would expect steady demand due to death rates in the UK, competition is fierce and you’ll need to actively reach out to customers to win business. 

Most funeral homes invest in traditional marketing techniques such as advertisements on public transport, branding on all company vehicles, print advertising etc. In the new age of digital advertising, there’s a wealth of new marketing software and approaches to try – so allot some budget to digital or even consider using an agency. 

Securing investment with a business plan

Funeral home owners can access many different financial products, from standard business loans to development finance for new construction. Deciding which product is right for you is just one step in the journey – you’ll also need to assess the lender’s market, find the right provider who is offering suitable terms and rates and then apply for finance. 

The business plan is so crucial to your application that you simply cannot afford to take risks with it. Make sure you have shown it to other business professionals and have full confidence in it before you apply. Here at Rangewell, our professional service sector finance experts will help you by reviewing the plan, suggesting improvements and then negotiating with lenders on your behalf. 

Get your business off to the right start with Rangewell’s support. Contact us today for a no-obligation discussion around your funeral home and requirements. Click to learn more.