Ottawa - Non-profit co-operative aims to undercut traditional and no-frills funeral providers

Bereavement shouldn't be a profit-driven industry, says Mark Goldblatt, the man who hopes to chase traditional funeral homes out of the Ottawa mortuary business.

On Wednesday, Goldblatt opened the doors of The Funeral Co-operative of Ottawa, a not-for-profit organization he says will charge considerably less than the established parlours to make final arrangements for the dearly departed.

There is already fierce competition for the 5,000 to 6,000 business opportunities available each year to the Ottawa bereavement industry, with other recent entries into the market, including price-cutting, no-frills cremation services.

But Goldblatt, a 61-year-old lifelong devotee of the co-op movement, thinks his organization will be able to use its built-in advantage to undercut the competitors, and in the process give grieving relatives a break from profit-seeking salespeople.

"We don't have to worry about maximizing returns to shareholders," he said. "At the time of distress, where you're making decisions within a 40-minute period, I think people would find it advantageous to go to a provider that operates on a not-for-profit basis."

The strongest proof of the venture's potential is the Coopérative Funéraire de l'Outaouais. Founded in 1979, it now handles more than 70 per cent of all funerals on the other side of the Ottawa River.

Goldblatt eagerly relates the story of a multinational funeral home chain that quit the Outaouais in frustration a couple of years ago.

"They weren't making enough return on their investment there, so rather than stay around they just sold their assets to the funeral co-op and left the Outaouais region," he said.

The Outaouais co-op has been assisting the Ottawa co-op by providing startup financing. It will also provide access to its cremation facility.

Goldblatt said his co-op will also be able to get a 30-per-cent discount off caskets through the Quebec Federation of Funeral Co-operatives, bringing down that part of the bill. Yet services and facilities — the heart of the traditional funeral home business model — will provide the most savings. Goldblatt estimates the co-op will charge about 50 per cent less on that front.

Instead of buying large buildings with oak-panelled rooms, the co-op will rent spaces by the hour in different venues around town. The suggested space, for those who don't have anywhere else in mind, will be the First Unitarian building on Cleary Avenue. And instead of long black Cadillacs, they are going with a Chevy Suburban, which can carry as many as eight mourners and double as a hearse.

Scott Miller, president of the Ontario Funeral Service Association, said he thinks the co-op will probably start off trying to compete against other new market entrants for low-end, basic work but in time could start to compete directly against the traditional funeral homes.

Miller, who is also funeral director with Hulse, Playfair & McGarry, said competition in the industry has been getting tougher over time. McGarry is one of the only family-owned businesses left in the Ottawa market, after most have been bought by large chains. This week, Ottawa's Tubman Funeral Homes sold a 50-per-cent share to a Toronto company.

The business has seen fundamental change in recent years, said Miller, who estimates that the cremation rate in Ottawa is now about 65 per cent.

"Casket sales are not what they used to be," Miller says. "These big, fancy, elaborate caskets that we used to see in the '80s and early '90s that families were buying have all but gone the way of the dinosaur."

For Goldblatt, the idea of even trying to sell upgraded products and services rankles. He said he's heard too many stories of "upselling" the grieving relatives.

"They go in with something in mind and find that they walk out with something else," he said. "It's not really a time you can bargain."

At the same time, Goldblatt, the funeral industry rebel, is still learning that even cheap funerals are still pretty expensive. Asked how much it would cost to rent a casket (for a family that is choosing cremation but wants a casket just for the visitation), Goldblatt has to check with his funeral director. He comes back with a price of $1,700. While still quite a bit cheaper than the $2,600 quote provided by Miller for such a rental, Goldblatt said, it's still a lot more than he expected.

"I think it's really too high."

By Zev Singer
Ottawa Citizen

Tagged in: News from our network Posted by: Fédération des Coopératives Funéraires du Québec Date: October 10, 2013

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