Ex-Wilbert CEO Colson Shares Big Picture of New Venture

November 1, 2010
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imageDetroit ? When Tony Colson resigned as president and chief executive officer of Wilbert Funeral Services October

1, it took many industry observers by surprise. Compounding the surprise was learning of Colson?s next enterprise ? becoming

president and CEO for a new company called Genesis Casket Company. The company is a subsidiary of Gestamp

North America, which is primarily involved in the automotive arena. Gestamp is a global enterprise, operating in

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23 countries.

?[Genesis] is an entirely new venture dedicated to providing caskets of world-class quality and service,? said Colson,

whose background includes extensive experience in the casket field. He served as director of sales for Batesville Casket

Company from 1988-04 and joined Wilbert in April 2008 after two years as vice president and general manager of Pella

Window & Door Corporation. Colson had also been a consultant for Legacy Management Partners in 2005-06.

With cremation seen as the steady growth segment within funeral service, basing a new enterprise on caskets, where

competition is intense and growth is flat, seems a mighty challenge. ?We see the market like most people do. I don?t see it

as flat to declining, I see it as stable for the coming time period, at least looking out over the next 20 to 30 years,? Colson

said, citing the recent work by Kenneth Gronbach, president of KGC Direct, Haddam, Conn.

Some background: At last spring?s International Cemetery, Cremation and Funeral Association Convention in San Antonio, where Gronbach was a keynote presenter, he charted the impact of the various generations over the past 100 years. The GI Generation was the baby boomers? parent. With 56.6 million births in the United States, the GI Generation was huge and made even larger by immigration, with more than 1 million additional people were coming to America every year. The majority of funerals being held today are of the Silent Generation, which Gronbach noted was the smallest generation of the last 100 years and accounts for the smaller death rate statistics.

To Colson?s point, as the mortality line inches its way into the baby boomers? demographic, funeral service volume is going to increase naturally, and, according to Gronbach, it is going to double over the next 20 years. ?I have not seen an industry that has had so much opportunity as yours going forward, where clearly the numbers are going to work in your favor,? Gronbach said in March. ?What I would do is grow your business for the next 15 years and then sell it. You will be selling it at a peak time. This is census data, just do the math.?

Said Colson: ?While the cremation rate will continue to ascend, so will the projected number of deaths. It?s just a matter of timing. There has been a declining death rate for several years now. But if you look at the time period between 1945 and 1965, I believe there was an excess of 70 million people born, and they will begin to die at some point.?

those deaths will result in cremation. The latest statistics by the Cremation Association of North America (CANA) predicts that cremation numbers will increase steadily. In 2015, the association projects a cremation rate of 46.04 percent based on 2.7 million deaths and 1.3 million cremations, which is an increase of nearly 350,000 cremation cases, while the number of actual deaths increase by 271,564. The number of non-cremations is expected to decrease about 5 percent ? from the 1,542,787 estimated for 2009 to 1,465,034 estimated for 2015.

Extending the projections to 2025, CANA forecasts 3.1 million deaths and 1.8 million cremations, for a rate of 58.85 percent. Of note: CANA is projecting that the actual number of cremations will double over the next 15 years, while the number of deaths will increase by 608,996 or 24.8 percent. Non-cremations are forecast to decrease by more than 18 percent, to 1,260,795.

Using data from Gronbach, CANA and the U.S. Census Bureau, Colson said there is reason for optimism. ?When you look at the extrapolations through 2025, the non-cremations are relatively flat,? he said. ?A slight change in the rate of mortality in any given year can make the difference very quickly, and predicting when those inflections will occur is difficult. When you look at the market from 2025 through 2050, I see a growth opportunity ? not in the rate as a percentage of deaths but the actual number of non-cremations themselves making the casket market stable and attractive for some time to come.?

It all comes back to timing, and Colson believes the timing is right for such an enterprise. ?If [the timing] wasn?t right, we would not be seeing consumers seeking alternatives to the current proposition, which is Asia,? he said. ?When you have an escalating number of people turning to that resource as an answer, it indicates they are dissatisfied to some extent with the current offering, and we see an opportunity there. Is the dissatisfaction price driven? I can?t speculate.

?Having said that, what was compelling to me about this was the opportunity to partner with a company with the deep resources, both intellectual and financial, that Gestamp brings to this proposition and truly bringing about a new product and a new service offering that we believe will be the highest quality product in the industry, provide fantastic service and great value for our customers,? Colson said.

Genesis is a ground-up enterprise, and Colson is currently concerning himself with securing facilities and equipment, as well as product development ? basically putting together the entire puzzle.

When asked about the specifics of the rollout, Colson said he wished to keep the specifics private because of the ultra-competitive nature of the industry but did say the plan is to enter the market in June 2011 and that the line would comprise primarily metal caskets, as well as some wood offerings. He expects the products to be marketed through traditional channels ? licensed funeral directors and cemeterians. ?I am reluctant to get into those specific details at this point simply because of the competitiveness of the market,? he said. ?We have a well-articulated, thought-out plan, and we are moving accordingly and are on time with our plan. But as to getting into the details, I would prefer to keep that to myself.?

As he immerses himself in his new position, Colson said it is an exciting time in funeral service as well as for his career. ?As I reflect back on my career, I guess I can look at it this way,? he said. ?During my career at Batesville, I was asked to transform an under-performing region and make it better. And we did. We went from basically the last position in the company to third (out of 14) in a year.

?When I went to Pella, I was asked to take an under-performing business unit and make that successful,? he added. ?And

I did. In the space in two years, we turned around that operation dramatically. At Wilbert, I was asked to take a company

that was not under-performing in a traditional sense [but] was not performing up to its potential and transform that, and

we did,? Colson said. ?Wilbert is in great shape financially and from a marketing point of view.?

?This is the chance to make an impact on an industry,? he added. And I think the timing is right, and that is what excites

me about this. We?re optimistic about it. I wouldn?t have taken it on if I didn?t have a great belief in this company?s

commitment to it and belief that the timing is right. There?s a legitimate need in the industry for it, and we think we understand

that need and are going to do our best to fulfill it.?

Article originally appeared in the October 28, 2010 edition of the Memorial Business Journal and was re-posted with permission from the MBJ.

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