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Published: Monday, 3/1/2010

Cremation trend pinches cemeteries, monument firms in area

BY LARRY P. VELLEQUETTE
BLADE BUSINESS WRITER

ERNEST L. "Butch" Krueger, who carves his living from large blocks of rock, thought he'd be under his own headstone before he witnessed a downturn in his industry.

But he was wrong.

"I've always said that as long as insurance companies stayed in business, we'd be healthy," said Mr. Krueger, owner of Design Memorial Stone Service in Maumee. "I've had to eat my words on that particular line."

High unemployment, economic uncertainties, and changing consumer preferences toward cremations as a lower-cost alternative have conspired in recent years to bury the idea that death was immune to recession.

Now the funeral industry - including casket and grave-marker manufacturers, funeral homes, and florists - is adjusting to a future without guaranteed profits.

"You're definitely seeing people going for less expensive funerals," said Stephen Gehlert, executive director of the Ohio Funeral Directors Association. "A lot of it depends on the specific area, but I've had members tell me that in their particular area that they have a 70 percent cremation rate."

According to the Casket and Funeral Supply Association of America, casket sales peaked in the United States in 2000, when 1.9 million units were sold.

Since then, sales have declined slowly but steadily. Annualized sales for last year were around 1.7 million.

Jeffery Lannen works on a project at Design Memorial Stone Service in Maumee. The firm's owner says shoppers concerned about finances are taking longer to decide to buy gravestones but when they commit to a purchase, they are spending at levels comparable to  those of earlier years. Jeffery Lannen works on a project at Design Memorial Stone Service in Maumee. The firm's owner says shoppers concerned about finances are taking longer to decide to buy gravestones but when they commit to a purchase, they are spending at levels comparable to those of earlier years.
JETTA FRASER Enlarge

Many of the changes affecting the funeral industry revolve around the increased acceptance and growing popularity of cremation.

About 865,000 remains were cremated in the United States and Canada in 2008, more than 35 percent of the nearly 2.5 million deaths in those two countries during that year, according to the Cremation Association of North America.

The percentage of cremations is more than double what it was 20 years earlier and almost 50 percent higher than it was in 1998.

For an increasingly cost-conscious consumer, there is little question why the cremation rate is rising and casket sales are falling.

Cremation Association officials say the average cost of a traditional burial nationwide is now about $7,200, more than four times the cost of cremation with a memorial service and inexpensive urn. Those costs can vary widely depending on personal choices.

George Reeb, of Reeb Funeral Home in Sylvania, said he has seen the economy affect his clients' decisions, even though the vast majority of them have life insurance coverage to pay funeral expenses.

"You can definitely correlate the bad economy, loss of jobs, people not spending as much, people being more concerned with costs," Mr. Reeb said.

He cited as an example the practice of having a viewing in a funeral home using a "rented" casket, followed by a cremation.

In that instance, a family would pay approximately $650 for the use of the casket instead of several thousand to purchase one and about $1,000 for the cost of cremation instead of several thousand for a burial plot and vault to contain the remains.

"It's certainly made us more aware of the way we direct our business," Mr. Reeb said.

Cremation Association records indicate that the practice was used in about 30 percent of deaths in Ohio in 2008, compared with 42 percent of deaths in neighboring Michigan.

As it has nationally, the percentage of cremations has risen steadily in both states in recent years, and a growing factor in that decision is cost, experts say.

"A lot of the cremation is being done for people who would never have considered it in the past," said Jennifer Baugess, a spokesman for the Ohio Board of Embalmers and Funeral Directors.

"You can get a direct cremation, with no service, you can get that for under $1,000, where even the most basic, direct burial, without a service, you're looking at over $2,500 minimum. If you throw in funeral home services, those are averaging well over $6,000, depending on [locale]."

According to the Ohio board, four crematories are licensed in Lucas County.

Bob Harden, executive director of Historic Woodlawn Cemetery, said the economy has caused sales at the facility "to go down a little bit," but said mostly what he sees are customers who are willing to consider different options.

"You might see circumstances where people opt for less expensive grave space. And people have always looked at cremation as an alternative to earth burial as a cost savings, although sometimes it is, and sometimes it isn't," Mr. Harden said.

Prices for a grave site at the historic park range from $900 to $1,600, depending on the section, Mr. Harden said. Prices for burial plots in other cemeteries around the area can range from as little as $200 to several thousand dollars, local morticians say.

"It's a very difficult time in people's lives, and they want to do what's right, but they often have to do it within the means that they have," he said.

One place they try to save, Mr. Harden said, is on the headstone, both when they buy it and how much they pay. Which is where Mr. Krueger comes in.

In late 2008, facing declining sales as the recession raged, Mr. Krueger had to do something he had never had to do in the 32 years that his business has been making headstones. He laid off three people.

"People come in and get prices, and then they'll come in six months later and buy the stone. People just seem like they don't want to let loose with their money," Mr. Krueger explained. "Once they commit themselves to spending the money, they're buying what they would normally buy."

The monument business has stabilized somewhat since late 2008, he said, enabling him to call back two of the people he laid off, although one is just part time.

But he said he shares his customers' concerns about large purchases right now, and he understands why they might be reluctant to spend several thousand dollars for a grave marker or monument.

"I don't have confidence in the economy right now," Mr. Krueger said, "and it's scary."

Contact Larry P. Vellequette at:

lvellequette@theblade.com

or 419-724-6091.



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