Developed in 1998 by the Government and Legal Affairs Task Force of the International Cemetery and Funeral Association
Background
As part of two distinct industries, cemeteries and funeral establishments provide consumers with substantially different products and services. Therefore, the combined operation of a cemetery and funeral home cannot result in monopolistic practices. An overwhelming number of states recognize this fact and do not prohibit the integration of cemetery and funeral home operations.
Some specific advantages to the consumer through use of jointly operated cemeteries and funeral homes are:
- Total arrangement – where the purchaser has the ability and convenience of making all at need or preneed arrangements simultaneously while dealing directly with one person;
- Convenient location – all services are held at one site, thus eliminating costly and possibly hazardous funeral processions, and;
- Potential Savings – by eliminating the duplicative administrative costs of maintaining separate businesses, combined operations run more efficiently and economically, which may also result in cost savings to the purchaser.
These combination operations allow businesses to be more cost-efficient through economies of scale, shared facilities and transportation services, central purchasing power, and joint marketing. Overhead increases, caused by escalating rates of insurance, regulatory compliance, labor and equipment costs, can also be held down through the use of combined operations.
In a few states, ownership and geographic barriers of entry into the business of operating combinations still exist. Restrictions deter the formation and operation of other innovative forms of funeral service businesses that may be more cost-efficient than traditional stand-alone providers.
Restrictions on the common ownership and joint operation of cemeteries and funeral homes serve no legitimate regulatory function and are potentially anti-competitive. Such restrictions work to the detriment of the consumer by stifling the normal competitive forces of a free market economy that are commonplace in virtually all other businesses and professions. In fact, in states where the restrictions have been repealed, there has been no indication of abuses caused by the combination format.
Principles
- Common ownership of cemeteries and funeral establishments should not be restricted.
- Funeral establishments should not be restricted from being located within a cemetery.
