Debt, Demographics, and Disruption | Funeral Director Daily

Are we living in the age of Debt, Demographics, and Disruption?  And, if we are, are there parallels from life and investing that might also move into the Death Care realm?

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I heard the phrase “Debt, Demographics, and Disruption” when I sat down to catch my breath on Wednesday afternoon after returning from an afternoon of working on the lawn at our lake cabin.  It was mid-afternoon and I heard it on the Claman Countdown on Fox Business Channel which is aired one hour prior to markets closing.

The phrase caught my attention because of the word “Demographics” and how I always relate America’s changing demographics with how it will affect the Death Care business.  Turns out the Claman Countdown was interviewing Mike Smith, an investment advisor  with Allspring Global and he mentioned that we were living in a world of Debt, Demographics, and Disruption.  You can see a short video of his explanation and a printed transcript here from Yahoo Finance.

In any regard catching the phrase made me think, as I mentioned, in Death Care terms and here’s some thoughts I have on the phrase and how it relates to Death Care businesses.

Debt — I think it is good for businesses to be nimble  —  to be able to move their resources into categories that will build their businesses.  If you have too big a percentage of your revenue going into the expense category of “Debt or Interest” it is hard to be nimble because it is hard to stop making those payments.

Just yesterday we published an article that Great Britain’s Dignity Funeral Directors sold about 90 of their under-performing funeral homes and used the proceeds to reduce their debt.  On this side of the Atlantic Carriage Service has also been upfront to their stockholders, through their quarterly reports,  that part of their process going forward is to reduce the percentage of debt they are paying.  Paying it off early will make them more nimble.

Take a look at your debt service.  If there is a way to pay some off early, think about doing it. . . . It will give you more flexibility moving forward.

Demographics —  Mr. Smith talked about the aging of America in terms of how health care payments will be dealt with and who will benefit from the coming aging tsunami.

According to him, Baby Boomers start turning 80 next year and we will soon have 70 million of them.  That will be a boom for funeral homes and death care providers if. . . . . . . your locations are in the locations that these Baby Boomers live in and if the services you provide are what they are asking for.

Disruption —  Mr. Smith talked about Disruption in some of the same terms that others do. . . with the focus being on how Artificial Intelligence and technology moves forward in our lives.

Tom Anderson
Funeral Director Daily

I’m pretty certain that there will be some disruption in Death Care. . . . . . What we don’t know is how disruptive things may become or if the disruption is minor over time and does not change the business of Death Care which would include disposition, ceremony, and memorialization that is usually lead by the traditional funeral homes.

There is already some movement away from those traditional retail funeral outlets and time will tell if it is a fad or a long-term social change.

In any regard a good column to end the weekend on. . . . As you’re mowing the yard or sitting at the lake this weekend you can ponder funeral service and how the 3D’s mentioned in this article will intersect with it.

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