Axel Jean-Francois
on
Funeral service is still one of the most economically durable businesses in America.
Dealmaking around funeral service is a different story.
I get some version of the same question in nearly every conversation I have with an owner thinking about an exit: Is now still a good time to sell?
The honest answer starts with separating two things people usually treat as one. The business is fine. The transaction market around it has gotten harder.
Confusing those two facts is how owners get blindsided halfway through a process, when a lender they were counting on steps back, financing takes longer than expected, or the assumptions behind a buyer’s offer change because the cost of capital changed.
That’s the market we’re dealing with in 2026.
Recession-Resistant Doesn’t Mean Perfectly Predictable
Funeral service has earned its reputation as one of the most recession-resistant industries in the country, and that reputation is deserved.
But recession-resistant is not the same thing as perfectly predictable.
The last year has been a useful reminder of that. National death volume moved around in 2025, and even the largest, best-capitalized operator in the profession has had to manage through periods of softer funeral volume. The long-term demand story can remain intact while a given year, quarter, or local market comes in softer than expected.
That distinction matters when you’re selling a business.
A buyer isn’t underwriting a twenty-year demographic trend. They’re underwriting the earnings of one specific business. They want to know what happened last year, what is happening now, and how much confidence they should have that the same earnings will still be there after closing.
The profession’s durability is a major advantage.
It just isn’t a guarantee that every year will be better than the last.
The Cost of Capital Is Moving the Wrong Way
The more immediate issue is financing.
The Federal Reserve raised interest rates again in September, its first increase since 2023. And the expectation among many economists and market participants is that another increase could follow.
I’m less interested in predicting exactly where the Fed goes from here than I am in what that direction means for a funeral-home transaction.
Money is getting more expensive.
When a buyer finances an acquisition, higher rates mean higher debt service. Higher debt service affects how much debt a business can support, how much equity a buyer has to contribute, and ultimately how much a buyer can afford to pay.
The buyer’s business may be exactly the same business it was twelve months ago. The financing math isn’t.
And when financing gets tighter, it doesn’t take much for a transaction that worked on paper to require a different capital structure, a different price, or simply more time to close.
That’s the part owners don’t always see coming.
What This Means If You’re Thinking About Selling
None of this means don’t sell.
It also doesn’t mean your business is worth less simply because financing has gotten harder.
What has changed is the environment around turning the value of that business into a closed transaction.
Buyers are looking harder at leverage. Lenders are looking harder at cash flow. Financing can take longer to arrange. Deals that depend on aggressive leverage or thin buyer equity have less room for error than they did when capital was cheaper and more plentiful.
That’s why preparation matters more right now, not less.
Before a business ever goes to market, there is a tremendous amount that can be done to make the eventual financing process easier.
The financials need to tell a clean story. Normalized EBITDA needs to be defensible. Real estate, preneed, related-party expenses, owner compensation and the other pieces of the business need to be understood before a buyer or lender starts pulling them apart.
The buyer universe matters too. If the deal is dependent on one type of buyer, one financing structure, or one lender, you’ve built very little room for something to go wrong.
And perhaps most importantly, the owner needs to understand what the market is actually going to ask before those questions show up in the middle of a live transaction.
This Is Where Foresight Matters
This is a harder market to navigate than it was a few years ago.
That doesn’t mean owners should sit on the sidelines. It means the difference between having a valuable business and successfully completing a transaction matters more than it used to.
That’s where Foresight comes in.
Our job isn’t to make interest rates lower or convince a lender to loosen its underwriting. We spend our time on the things an owner can actually control: understanding the financial story behind the business, getting the numbers into a form a buyer can underwrite, identifying the issues that are likely to come up in diligence, building the right buyer universe, and managing the process once those buyers are at the table.
We also spend a lot of time understanding the market on the other side of the transaction. What buyers are actually looking for. What lenders are willing to finance. Where deals are getting stuck. What makes a buyer comfortable enough to move forward, and what makes them slow down.
That matters more when the market gets harder.
An owner shouldn’t have to learn how today’s capital markets work by putting a business on the market and finding out halfway through the process that the financing assumptions no longer work.
That preparation is part of the value of having Foresight involved before the process ever starts.
We can’t control interest rates. We can’t decide which lenders stay in the market. We can’t make capital cheaper.
What we can do is make sure an owner enters the market prepared for the conditions that actually exist.
Funeral service hasn’t gotten less durable.
Getting a deal done has gotten harder.
Knowing the difference, and preparing for it before you go to market, is the whole game right now.