Funerals giant Dignity braces for volatile market

Funeral provider Dignity has said it expects trading in 2018 to be volatile due the relationship between funeral price, service and volume that would “take time to settle down”.

Dignity is the UK’s largest provider, owning more than 500 funeral directors and operating 22 crematoriums.

Ahead of its AGM today, the company said that although 2017 was another successful year for the group, it took action earlier this year to modify its pricing strategy and market positioning to protect market share in the face of increased competition.

The Sutton Coldfield-based group has introduced a “simple service” price in response to competition.

It said analysis has shown a step change in the number of simple funerals conducted by the group, at a run rate of approximately 15% of all funerals, lower than the 20% originally anticipated by the board.

In its first quarter trading update announced in April, Dignity said that the death rate trend was running at approximately eight percent ahead of last year for the first quarter.

“Based on this, the board confirmed that it believed that results for the full year would be ahead of market expectations. The group has seen full year market expectations subsequently increase.”

Dignity also said it welcomed the Competition and Markets Authority’s launch of a review into the £2bn funerals market to ensure people aren’t getting a bad deal.

“We look forward to sharing the work we have already collated to support the calls for regulation we have been making for some time,” the company said.

Shares in Dignity fell 14% to £10.43 earlier this month as investors worried about the potential risks from greater regulation.