Big Question!! How much should the value of a funeral home be discounted if the facility is being sold for other use?

A funeral home in your area has accepted an offer for their real estate that is much greater than the business is worth. How much would you discount the value of the business if you were able to buy the name, phone number and files as well as any other equipment?

Let’s say the business WITH the real estate is valued at $1,500,000. Their business is steady and the owner is willing to help in transition but plans on retiring as soon as possible.  What would you be willing to pay?

Hint:

  • Assuming a market with average competition I believe closing a facility and transitioning to new ownership could impact 30% to 50% of volume
    • If it is in a two competitor small town I would lean toward 50% if it wasn’t sold to the competitor

I know “IT DEPENDS” but let’s get some collective opinion going here. Give me your ideas in the comments section. I will answer all questions and publish my “mathematical” approach (if someone else doesn’t” in two weeks.

War Stories welcome!