By George Hale • MAR 21, 2017 for 88.9 KTR
In Northeast Texas, the cost of a cremation can be unpredictable.
In Paris, for example, the Peaceful Rest funeral home charges $950. Go two miles east, to Bright Holland funeral home, and it's more than $2,000. Three others in Paris charge somewhere in between.
In comparing cremation costs, one pattern does emerge: Prices at funeral homes owned by Houston-based Service Corporation International are often significantly higher than the others. And not just in Paris.
"The independent funeral homes are significantly cheaper than an SCI funeral home. ... They'll be 40 percent cheaper," says Jim Bates, a funeral consumer advocate.
"SCI traditionally since their inception has always tried to stay in the background. Their whole thing is to buy the independent funeral homes -- the mom and pop-type funeral homes -- but keep that 'Smith & Sons' or whatever it's called, keep that out front."
SCI is the largest owner of funeral homes and cemeteries in the world. It claims around 16 percent of the self-described death care market. Its main brand Dignity Memorial operates over 2,000 locations.
"People have characterized them sometimes as the Walmart of funeral services. But that analogy, that comparison, is not accurate," says Josh Slocum, executive director of the Funeral Consumers Alliance.
"Whatever you may think of a Walmart or a McDonalds, the fact of the matter is their big buying power in economies of scale do translate into lower retail prices for the customer. That's part of their businesses model. It is exactly the opposite at SCI."
"Their economies of scale, their centralized facilities -- where they don't have to duplicate -- these are all smart business moves. But those savings go to SCI's real customer. And that's not you, who they call their families; it's their investors."
Earlier this month, the alliance and the Consumer Federation of America released the results of a survey showing that SCI charged 47-72 percent higher prices than others in their markets.
Wholesale business
Bates, who directs the alliance's North Texas chapter, says many people don't realize that cremation services from different funeral homes are often performed at the same facility.
"There's about 3,000 or something like that funeral establishments. But only about 100 crematories. So, you'll get pricing from $700 to $6,000 for a direct cremation. Both of those being exactly the same thing. Body A at the $700 cremation price will be cremated in the exact same crematory as the $6,000 one."
Federal trade regulations require funeral homes to provide in-person consumers with a price list. They must also disclose prices by phone. But they don't have to put that information on the internet.
Bates is hoping that when the rule is updated, the Federal Trade Commission will require online pricing when it next updates the regulations.
"That Funeral Rule was written in 1984. ... And then the internet really didn't start kicking in until the late 1990s. So we're just trying to get up to speed," he says.
KETR reviewed the website of dozens of funeral homes in cities across northeast Texas. Few independent homes, and none owned by SCI, disclosed prices online.
Slocum says the lack of transparency is partly a result of consumer behavior.
"How are you going to have competition if you don't have consumers putting pressure on them to moderate prices? That's one reason," he says.
"They don't have to because we consumers are delivering ourselves up as a voluntarily captive market. We don't have to do that, and we shouldn't do that. But that is what we do."
KETR reached out to SCI-owned funeral homes in Paris, Terrell, Rowlett, Canton, Plano, Denison, Kaufman, Frisco and Dallas. Six of them referred inquiries to SCI's corporate headquarters, and two of them did not respond to inquiries.
SCI declined to make anyone available for interview. However, a spokeswoman provided the following statement by email:
“We take the rights of client families, the Funeral Rule, and other industry regulations and requirements seriously. We provide our associates with a comprehensive training program as well as continuing education to ensure all industry requirements and guidelines, including those related to sharing pricing information, are met or exceeded.
We continuously look for ways to improve the customer experience and online resources are one way to do that. However, we strongly believe having a personal conversation to understand how families envision honoring their loved ones goes far beyond simply using an online resource and is the best way to help families during a very difficult time.
We believe every family is unique, and it’s our job to understand their situation and preferences for celebrating a loved one’s life – from simplified arrangements to unique, personalized memorials. Taking the time to pre-plan is a good way to comparison shop to find the level of service and price that is right for you.
Our Dignity Memorial providers consistently earn high scores in customer satisfaction through JD Power customer satisfaction surveys. In January 2016, we were awarded the J.D. Power President’s Award in recognition of an ongoing dedication to service excellence including quality improvement, customer satisfaction and the development of enduring client relationships. SCI and its family of brands, including Dignity Memorial, join an exclusive group of only twelve other companies to receive this esteemed award in J.D. Power’s 47-year history.”