Japanese Funeral - Japanese Funeral Industry

Japanese Funeral Industry

The average cost of a Japanese funeral is about 2.31 million yen (USD 25,000) according to a 2008 study by the Japan Consumer's Association. This cost includes services such as 401,000 yen for catering to attendants and 549,000 yen for services of the priest. Overall, the industry has a revenue of about 1.5 trillion yen with about 45,000 funeral homes. In 2004, 1.1 million Japanese died (2003: 1.0 million), a number that is expected to rise in the future due to the increase of the average age in Japan; see demographics of Japan. Funeral Business Monthly estimates that there will be 1.7 million deaths by 2035, and revenue of 2 trillion yen in 2040.

There are a number of reasons for the high cost of funerals. First, prices in Japan are generally among the highest in the world. A bigger reason, however, is that the relatives of the deceased are very hesitant to negotiate prices of a funeral service, and also do not compare prices, as they do not want to give the opinion that they are cheap about their relative. This situation is abused by funeral companies, which sell rather expensive and often-unspecific packages, matched more to the funds of the deceased family than to the actual services provided. Often, aggressive sales tactics push the relatives towards expensive contracts. In many cases, there is not even the mentioning of a price until the funeral is over. A 2005 Fair Trade Commission study found that 36% of the customers did not receive a quote before being charged and 96% felt that the free selection of services was inadequate, and many decisions were made for them. 54.4% of the funeral services offered price lists and catalogs to choose between different options.

Recently there have been some changes in the funeral industry, and some funeral homes offer more competitive and transparent pricing than a standard funeral provider. These offer funerals starting at about 200,000 yen, a fraction of the regular overpriced services, and lists the different options and prices to choose from a la carte. Many of these new funeral homes are started by non-Japanese nationals. Also, recently hotels with a decreasing income due to a decrease in weddings have started to offer funeral services. Overall, the level of competition is increasing. To stay competitive, the prices of regular funeral homes are also decreasing over time. Another recent introduction are services where a person can choose his or her funeral service before death, and pays a monthly fee (e.g. 10,000 yen) to cover all costs of the funeral.