This article was written by our expert who is surveying the industry and constantly updating the business plan for a funeral home.
This guide gives clear, current numbers on average revenue, profit, and margins for a U.S. funeral home in 2025.
It distills industry benchmarks into straightforward targets you can use for pricing, staffing, and budgeting a new funeral home. Figures below reflect single-location operations unless noted and are based on recent U.S. data and trade sources.
If you want to dig deeper and learn more, you can download our business plan for a funeral home. Also, before launching, get all the profit, revenue, and cost breakdowns you need for complete clarity with our funeral home financial forecast.
Most single-location funeral homes in 2025 generate about $1.09M in annual revenue, with typical net margins of 10–15% and top performers reaching 20%. Cremation now drives the majority of dispositions, compressing revenue per case versus burials, but smart service packaging and merchandise can protect margins.
Payroll usually runs 25–35% of revenue and total operating expenses 80–90% of revenue. Healthy EBITDA margins land around 15–22%, and recent sale valuations commonly trade near 6–8x EBITDA, higher with strong location, growth, or included real estate.
| Metric | 2025 Benchmark | What this means for a new funeral home |
|---|---|---|
| Average annual revenue (single location) | $1.09M | Plan near $900k–$1.2M depending on market size and call volume (113–200 families/year). |
| Industry size (U.S.) | $16B+ | Stable, resilient sector with moderate growth and rising cremation share. |
| Net profit margin | 10–15% (up to 20%) | Set pricing and cost control to land above 12% net by Year 2. |
| Net profit (dollars) | $109k–$218k | At $1.09M revenue, this is a realistic annual take-home for an efficient operator. |
| Revenue mix (burial vs. cremation) | 65–70% vs. 30–35% | Expect lower average ticket with more cremation; offset via service bundles and memorial add-ons. |
| Gross margin – services | Burial: 45–65%; Cremation: 30–50% | Higher service intensity and facility usage increase service margin on burials. |
| Gross margin – merchandise | 40–50% | Applies to caskets, urns, vaults; upsell premium products responsibly. |
| Payroll (of revenue) | 25–35% | Right-size staffing and scheduling to protect margin during demand swings. |
| Total operating expenses | 80–90% of revenue | Aim for <85% by Year 2 through vendor negotiation and process discipline. |
| Revenue per burial | $7,000–$10,000 | Full-service burials lift ticket size via viewing, ceremony, and merchandise. |
| Revenue per cremation | $2,000–$5,000 | Direct cremation often ~$2,000–$2,500; add value with memorial options. |
| EBITDA valuation multiple | 6–8x | Premiums for strong brand, real estate included, and consistent call volume. |
What is the average annual revenue for a U.S. funeral home in 2025?
The average single-location funeral home generates about $1.09 million in annual revenue.
This level typically corresponds to 113–200 calls per year depending on market density and pricing. Urban or affluent markets may exceed $1.2 million with similar case counts due to service mix and merchandise uptake.
Plan your first-year forecast around $900,000–$1.1 million unless you have clear evidence of higher call volume or pricing power in your trade area. Tie your capacity (staffing, vehicles, chapel) to this realistic call assumption to avoid overfixed costs.
We cover volume-to-revenue modeling in our templates and show how small price changes shift revenue materially for a funeral home.
You’ll find detailed market insights in our funeral home business plan, updated every quarter.
What profit margins do funeral homes usually achieve today?
Typical net margins are 10–15%, with top performers reaching 20%.
Margin outperformance usually comes from disciplined payroll management, strong prepaid/preneed pipelines, and effective merchandise strategy. Underperformance often tracks to underpricing, excess labor, or low average ticket from commoditized cremation.
Target a net margin above 12% by Year 2 and maintain an EBITDA margin between 15% and 22% through pricing discipline and cost control. Monitor revenue per call monthly to spot slippage early.
Set minimum price floors aligned to your cost structure and review discounting rules quarterly.
This is one of the strategies explained in our funeral home business plan.
What is the average net profit (in dollars) for a single-location funeral home?
Average annual net profit typically falls between $109,000 and $218,000.
At the $1.09M revenue benchmark and 10–20% net margin, this is a sound planning range for owner-operators. Geography, cremation mix, and merchandise uptake are the main drivers of variance.
Build a monthly P&L that connects call volume, price list, and labor schedule to ensure you protect at least a 12% net. Reforecast quarterly to reflect seasonality and prepaid conversion.
Use a rolling 13-week cash flow to keep debt service and inventory purchasing aligned with collections.
Get expert guidance and actionable steps inside our funeral home business plan.
How much revenue usually comes from funeral services versus cremation services?
Most funeral homes still earn 65–70% of revenue from funeral/burial services and 30–35% from cremation.
Cremation now accounts for roughly 55–58% of dispositions nationwide, but it produces lower revenue per case than burials. Operators counter this by packaging memorial services, viewings, and premium urns to raise the cremation ticket.
Track mix monthly because a two-point shift toward direct cremation can reduce revenue per call enough to shave net margin. Price your packages so memorial-focused cremations deliver adequate service margin.
Design at least one “value cremation with memorial” bundle to capture price-sensitive families without eroding profitability.
What are the average gross margins on casket/merchandise versus services?
Gross margins on casket and related merchandise average 40–50%, while services range from 45–65% for burials and 30–50% for cremations.
Premium caskets, vaults, and memorial items can exceed 50% gross margin if priced responsibly and aligned with local expectations. Service margins hinge on staffing efficiency, facility utilization, and package design.
Maintain transparent price lists and train arrangers to present options that fit families’ needs without discounting. Review vendor terms annually to protect merchandise margin.
Use contribution margin by package to decide which offerings to promote during peak periods.
How do labor costs affect a funeral home’s profitability?
- Payroll is usually 25–35% of revenue; small overruns quickly erode net margin.
- On-call/overtime management is critical during seasonal spikes and weekend services.
- Cross-training (arrangements, directing, admin) reduces staffing peaks and idle time.
- Scheduling aligned to service times and removals lowers paid but unproductive hours.
- Outsourcing trade services for embalming or removals can stabilize costs at low volumes.
What are typical operating expenses as a percentage of revenue?
Total operating expenses usually fall between 80% and 90% of revenue, including payroll.
Newer operators should target <85% by Year 2 through vendor consolidation, energy savings, and inventory turns. Insurance and vehicle costs are material line items that require annual bidding.
Adopt a zero-based budget for each cost center (vehicles, facilities, admin) and re-justify spending every six months. Track fixed versus variable components to protect cash in slower months.
Negotiate casket and urn pricing based on annual volume and prompt payment terms.
We cover this exact topic in the funeral home business plan.
How do operating costs break down across key line items?
Here is a practical expense benchmark breakdown for a funeral home budget.
Use these ranges to build your first-year forecast and to compare against your monthly actuals.
| Expense Category | Benchmark % of Revenue | Notes for Control |
|---|---|---|
| Payroll & benefits | 25–35% | Optimize scheduling; monitor OT; cross-train to reduce peaks. |
| Facilities (rent, maintenance) | 8–12% | Right-size chapel/embalming space; negotiate renewals early. |
| Vehicles & fuel | 3–6% | Share hearses/limos across locations; consider lease vs. buy analysis. |
| Insurance (GL, professional, vehicles) | 2–4% | Annual market check; raise deductibles thoughtfully. |
| Merchandise COGS | 20–30% | Vendor rebates, SKU rationalization, inventory turns & consignment. |
| Utilities & cleaning | 1–3% | LED retrofits; scheduled HVAC; negotiate janitorial contracts. |
| Marketing & community outreach | 1–3% | Focus on preneed and local partnerships; track lead cost. |
How does profitability differ between independents and chains?
- Independents often enjoy stronger local trust and can tailor services for higher satisfaction and reviews.
- Chains benefit from purchasing power and standardized SOPs, supporting slightly higher EBITDA margins in some markets.
- Independents may face higher per-unit costs for merchandise and insurance without group contracts.
- Chains can centralize admin and call centers, lowering overhead per location.
- Either model can outperform with strong pricing discipline and a robust preneed pipeline.
What fixed costs most affect margins in a funeral home?
- Facility occupancy (rent or mortgage, maintenance, property taxes).
- Salaried staff and management compensation.
- Vehicle leases/financing and required insurance.
- Licensing, professional fees, and compliance costs.
- Equipment depreciation (prep room, refrigeration, IT systems).
How has the shift to cremation changed average revenue and margins?
Cremation now represents the majority of dispositions and lowers average revenue per case compared with burials.
Direct cremation often prices near $2,000–$2,500, while full-service cremation packages and memorials can reach $3,500–$5,000. The decline in casket/vault attachment reduces high-margin merchandise, compressing total gross margin.
Offset this by offering meaningful memorial options, event services, and premium urns that families value. Track contribution margin by package to ensure cremation offerings remain profitable.
Consider partnerships with venues for life celebrations to raise average ticket on cremation families.
It’s a key part of what we outline in the funeral home business plan.
What EBITDA multiples are used to value funeral homes today?
Recent transactions commonly value funeral homes at 6–8x EBITDA.
Multiples skew higher for prime locations, strong brand reputation, consistent call volume, and when real estate is included. Subscale operations with high cremation mix and weak margins tend toward the lower end.
Document stable three-year EBITDA, show signed preneed contracts, and maintain clean compliance records to support the upper range. Present a clear growth plan for call volume and pricing mix.
Engage lenders early to validate valuation expectations and debt service coverage.
This is one of the many elements we break down in the funeral home business plan.
Which KPIs define a financially healthy funeral home?
Focus on a concise KPI set that predicts cash flow and valuation.
Track these monthly with targets tied to your market and price list, and review trends quarterly to adjust staffing and inventory.
| KPI | Healthy Range | How to Use It |
|---|---|---|
| EBITDA margin | 15–22% | Confirms operating efficiency; below 15% triggers cost/pricing review. |
| Net margin | 10–15%+ | Owner take-home; aim for 12%+ by Year 2. |
| Revenue per call | $6k–$8k burial; $2k–$5k cremation | Signal of package and merchandise effectiveness. |
| Payroll % of revenue | 25–35% | Primary lever; align staffing to service schedule. |
| COGS % (merchandise) | 50–60% | Negotiate vendor terms; rationalize SKUs. |
| Calls per FTE | 22–35 | Productivity barometer; informs hiring and cross-training. |
| A/R days (at-need & preneed) | <30 days | Protect cash; implement payment policies and financing options. |
Conclusion
This article is for informational purposes only and should not be considered financial advice. Readers are encouraged to consult with a qualified professional before making any investment decisions. We accept no liability for any actions taken based on the information provided.
Want to go further? Explore more resources tailored for funeral home owners.
From insurance and budgeting to customer segments and monthly income, these deep dives give you practical steps and numbers you can apply immediately.
Sources
- Funeral Director Daily – Average Size Funeral Home
- DojoBusiness – Funeral Home Profit Margins
- National Funeral Directors Association – Statistics
- DojoBusiness – How Much Profit Does a Funeral Home Make?
- Funeral Mavericks – Profit Benchmarks
- End-of-Life Planning – Funeral & Cremation Costs
- Businessplan-templates – Funeral Services Running Costs
- Service Corporation International – Q1 2025 Results
- Funeral Director Daily – SCI Q1 2025 Commentary
- US-Funerals – Industry Overview
-Funeral Home Insurance: What Coverage Do You Need?
-Funeral Home Business Plan: Template & Example
-What Is the Average Monthly Income of a Funeral Home?
-Who Are the Customers of a Funeral Home?
-Budget Tools for Funeral Home Owners
