Blog Publisher’s comments:
Sorry, this one has nothing to do with reprographics!
But, I couldn’t help myself; I just had to “say
something” about this news!
First, growth in demand has nothing to do with two
companies in the same business merging together. Mergers of this sort are all about one thing
– increasing profits. Those increased
profits come from doing two things – a) economies of scale serve to reduce
manufacturing and operating costs, and b) Increased market-share strength leads
to “pricing power.” I don’t think any of
us will be surprised, if, over the next few years, prices for funeral services
and for coffins go up, not down. As that
saying goes, “the only certain things in life are …. death and taxes.” Demand for funeral services or coffins have
never been cyclical in nature (i.e., they are not affected by recessions);
demand grows as deaths grow. (That’s a
horrible thought, huh?)
And, now for a brilliant idea for
reprographers. Last night on
NBC Nightly News there was a segment about a craftsman, an artist, who creates
one-of-a-kind coffins, coffins that are art!
One of the examples shown was a coffin that looked like a Lion. It was beautiful …. and quite unique. When there’s a 3D printer that’s large enough
to “print” a coffin, that would allow designers to come up with incredible
ideas for “containers” to serve as coffins.
After they are designed, print them “on-demand”, one by one. Will probably require a 3D printer that
prints hard plastic objects. My grandson
likes the yellow rubber ducks I bought for his bath-time. It might please him, when my time is up, if I
was buried in a giant yellow duck coffin.
At least that would give him some reason to smile.
Okay, here’s the press release:
Top two U.S. funeral companies merge as baby boomers boost
demand
Wed May 29, 2013 12:42pm EDT
(Reuters) - Service Corp
International (SCI.N) agreed to buy Stewart Enterprises Inc (STEI.O) for $1.13 billion, merging the two largest U.S. funeral home
operators as the industry gears up to offer more services to aging baby
boomers.
Large-scale consolidation in the
highly fragmented funeral business has long
been on the cards, with the industry looking to sell more pre-planned funeral
contracts to the 76 million baby boomers in the United States.
Service Corp, which failed in a bid
to take over Stewart in 2008, said on Wednesday the combined company would have
a backlog of future revenue exceeding $9 billion from pre-planned bookings.
The group would own 1,653 funeral
homes and 515 cemeteries in 48 states, eight Canadian provinces and in Puerto
Rico, and have proforma revenue of nearly $3 billion.
Shares of Service Corp, which had
revenue of $2.4 billion in 2012, rose as much as 11 percent, suggesting
investors were happy with the deal, which was priced at 24.5 times Stewart's
forward earnings.
The number of funeral homes and
crematories owned by both the companies would be about 20 percent or less of
the total in the United States, said Barbara Kemmis, Executive Director of
Cremation Association of North America.
"I see this as evidence that
there is room in this industry for economies of scale and consolidation,"
she said.
Just under 25 percent of the U.S.
population was over the age of 55 in 2011, up from 20.4 percent in 2000,
according to the Census Bureau.
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