The novel coronavirus has already killed 200 people in Texas, hospital and ICU admissions are grimly ticking higher—but the Service Corporation International, America’s largest funeral home proprietor, is quieter than usual
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But rather than boost SCI’s revenues, Ryan insists that the pandemic will actually hurt business. “Our ability to get in front of the consumer is limited,” says Ryan. Death is not a one-size-fits-all business. A simple cremation with a plain-Jane urn and no reception costs around $3,000. But an elaborate funeral with a big crowd, a mahogany casket, lavish flowers and an ornate tombstone could run $20,000 or more. And the pandemic severely limits SCI’s ability to upsell the bereaved.
Also affected—so called pre-need sales, which are typically arranged by people well in advance of their actual death, most of which occur face-to-face with SCI’s salespeople. According to Raymond James analyst John Ransom, “pre-need” cemetery plot sales are expected to decline to $158 million in the second quarter of 2020, from $226 million a year ago, down 30%. Death may be on people’s minds right now, according to Ryan, but not many are in the mood to tour cemetery plots or select a headstone.
Ryan, a C.P.A. by training, joined SCI 24 years ago as an accountant and became president in 2003. He spent his early tenure cleaning up the balance-sheet mess left behind by founder Robert Waltrip, who began rolling up mom-and-pop funeral parlors in the 1960s before embarking on an ill-advised round of international acquisitions. Ryan made his own round of domestic acquisitions, including the San Francisco-based Neptune Society in 2011 and Stewart Enterprises of Louisiana .
Despite Ryan’s complaints about SCI’s revenue woes, there may be a silver lining. Many people who were denied an expensive, well-attended funeral may choose to have a pricey memorial service once the pandemic passes and SCI is angling for that business. “There’s real pent-up want and need to provide that closure, by having your loved ones around you at this time,”says Ryan.
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