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Summary of our market study
Since 2020, the global undertaker market has seen notable growth, largely attributed to an increase in mortality rates due to the COVID-19 pandemic. In particular, industry sales rose by 6.1% worldwide in 2020. Germany has undergone a demographic shift with an aging population, the mortality rate having risen from 10.6 to 11.9 per 1,000 inhabitants in 2020, which has stimulated the funeral market. The German funeral industry is highly fragmented and dominated by small businesses; 97.4% of funeral companies will have fewer than 20 employees by 2020. Geographical price disparities exist in Germany, withservice costsvarying according to region and type of funeral.
An upward trend in the preference for cremation over traditional burial has been observed, with cremations accounting for 77% of funerals in 2021. The funeral market is expected to continue to grow, with the global market set to rise from a value of $62.5 billion in 2023 to $113 billion in 2033. The German funeral market is also expected to grow in correlation with the increasing number of deaths, as evidenced by the market's 10% growth between 2014 and 2018, and the continuation of this trend is expected as the number of deaths increases.
Trends and analysis of the German funeral services market The German funeral services market is experiencing several definitive trends that reflect broader demographic and social changes.
With a significant increase in demand fuelled by the recent coronavirus pandemic, the industry sawoverall revenue growthof 6.1% in 2020, demonstrating the market's responsiveness to unprecedented events. In addition, as Germany mirrors the global trend with an aging baby-boomer population, demand for funeral services has seen a stable incline. The country's average mortality rate rose from around 10 to 12 deaths per 1,000 inhabitants between 2011 and 2020, as reported by the World Bank. The total number of deaths in Germany rose by almost 27%, from just over 800,000 to between 1 and 1.1 million over the period 2000-2023, underlining the expansion of the funeral market. This growth is a direct consequence of an ageing population - the median age in Germany is rising, with a staggering 22% of the population expected to be over 65 in the early 2020s, and this figure could rise to around 25% in the 2030s. These structural demographic changes are not the only factors shaping the funeral market in Germany. There is a shift towards cremation, with almost 77% of funerals in 2021 opting for this method rather than traditional burial.
Consumers have become more expressive in their funeral wishes, with a notable increase in preference for tree burials and low-maintenance resting places, challenging the more conventional modes of burial. In addition, the funeral services market is taking account of the changing religious and cultural landscape, with more and more offerings tailored to Islamic burials. This trend corresponds to theincrease in the Muslim population, estimated at between 4.4 and 5.5 million in the country, which is leading to a rise in the number of funeral directors catering to Islamic rites and practices. The market is mainly made up of small players, with around 97% of undertakers employing fewer than 20 people, and around 64% of these being sole proprietorships. Despite the predominance of small entities, there is an upward trend in the number of companies providing funeral services, which increased by 18% between 1998 and 2018. Geographically, the market shows variations, with the highest average prices for direct services observed in Saxony-Anhalt, while Mecklenburg-Western Pomerania offers the most affordable options...
Profile of the main players in the German funeral market
In the diverse and evolving landscape of the German funeral market, several outstanding players have established themselves as leading figures, offering a variety of services to meet the growing demands shaped by demographic and cultural change.
- As an online comparator, BESTATTUNGEN.DE plays an essential role in offering transparency and choice to consumers looking to compare different funeral service offerings. By bringing together information from different providers, it enables individuals to make informed decisions about funeral arrangements that match their preferences and financial constraints.
- The Federal Association of German Funeral Directors represents the interests of funeral directors throughout Germany. As an industry body, it sets professional standards, offers advice and helps member organizations navigate the regulatory framework governing funeral services. The association's role is crucial in guaranteeing quality and ethical practices in the market, and thus maintaining consumer confidence in the industry's players.
These players, along with the many local and regional funeral companies, create a market structure that offers consumers a wide range of choices. From traditional burials to modern, environmentally-friendly alternatives such as tree burials, the German funeral market is characterized by its ability to respond to the diverse cultural, religious and personal preferences of people faced with the sensitive and important issue of burying their loved ones.
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Summary and extracts
1 Market overview
1.1 Scope of the study
The funeral market includes all services that can be used at the time of death of a person. These are:
- direct services of the funeral director: these services include the provision of the coffin or urn (depending on the choice of cremation or burial), the transfer of the body and the hygienic care of the deceased. Funeral homes can also handle administrative procedures such as applying for a death certificate or deregistration with health insurance companies, etc. can be taken over.
- outside services such as the florist or placement of the obituary. Cemetery fees are also included in funeral expenses.
Due to the increase in deaths as a result of the coronavirus pandemic and price increases by industry participants due to cost, industry revenue grew by 6.1% globally in 2020.
As baby boom generations continue to age, the average mortality rate in developed countries is rising. Germany is no exception, with the average mortality rate rising from 10.6 to 11.9 per 1,000 population between 2011 and 2020[World Bank], contributing to the development of the funeral market. Demographic change is a positive effect for the funeral market.
The German market shows large differences depending on the provider, type of funeral, choice of ceremony or region. The industry is highly fragmented, with a large number of companies offering funeral services. These range from small, local businesses to larger companies that operate nationwide. The largest companies in Germany are mostly organized as franchises, which gives them a competitive advantage.
According to the nomenclature from the Federal Statistical Office in Germany, the sector 'Funeral services' is identified by the sector code'S9603'.
1.2 The global funeral market
In ****, the global funeral market is worth $**.* billion and is expected to grow at an average annual rate of *.* percent for ten years until it reaches $*** billion in ****. Projected sales growth in the funeral industry Worldwide, ****-****, in billions of US dollars Source: Factmr The funeral market is very uneven around the world, as spending on burials varies according to religious practices and customs. Cremation is always cheaper than burial. For example, in the Indian religion, cremation is common, while in the Muslim religion it is forbidden and burial is only in a white cloth.
Funeral industry revenue World, *****, $ billion Source: ****
1.3 The development of the German funeral market
In recent years, the funeral market has steadily increased and there are several reasons for this. One of the main reasons is the COVID-** pandemic, which has claimed many lives worldwide, including Germany. The high number of deaths has led to a higher demand for funerals and thus an increase in the funeral market. Another important factor is demographic change. The aging population is leading to a higher demand for funeral services. older people are increasingly thinking about their own funeral wishes and want to ensure that these are met.
Sales of German funeral homes Germany, **** - ****, In € billion Source: ****
If the German funeral market follows the trend of deaths, based on the increase in the number of deaths by **% in the period ****-****, it can be assumed that the funeral market has also grown by **% in this period, generating €*,*** million in ****. Between **** and ****, an increasing number of deaths can be seen. in the first quarter of ****, almost a third of the number of deaths in the previous year has already been reached.
Deaths in Germany Germany, **** - ****, total number Source: ****
2 Needs analysis
2.1 A structural demographic development
Germany is one of the leading countries in Europe in terms of the proportion of the population over **. In ****, only **% of the total German population was over **, while this figure reached almost **% in **** and is expected to reach **.*% by the end of the next decade. ****: **.* million people aged **+ - **% of the total population ****: **.* million people aged **+ years - about **% of the total population Age Man Woman Man % Woman % **-** *.***.*** *.***.*** ** ** **-** *.***.*** *.***.*** ** ** **-** *.***.*** *.***.*** ** ** **-** *.***.*** *.***.*** ** ** **-** ***.*** *.***.*** ** ** **-** ***.*** ***.*** ** ** **-** **.*** ***.*** ** ** ***+ *.*** **.*** ** **
The recent trend seems to be favorable for the market; there is a trend increase in the number of deaths in the period ****-****, with the total number of deaths increasing from ***,*** to *,***,***, an increase of **.**% in this period.
In addition to the cyclical factors that can affect the mortality rate, Germany faces a structural evolution of its demography that favors the funeral market: the aging of the population . The median age continues to increase.
Assuming a high birth rate (***), the population development could be influenced accordingly and a population projection could be determined, resulting in the following proportion of persons over ** years of age in Germany:
Development of the proportion of people aged ** and over in Germany, from **** to *****, % of population Source: ****
Since ****, the proportion ...
2.2 German expectations are changing
The ratio of coffin and urn burials Germany, **** to ****, in % Source: ****
There are basically only two alternatives: While burial in the ground was the classic form, cremation has recently become the most common. In ****, **% of all funerals involved cremation and **% involved burial.
The choice between burial and cremation then leads to several options: Row burial for a casket or urn or a communal grave, anonymous burial, tree burial in a cemetery, burial at sea, air burial, diamond burial, burial in a burial church, or tree burial.
Funeral Wishes Germany, ****, % Source: ****
According to thesurvey conducted by theconsumer initiative Bestattungskultur, there is a high demand for tree burial. The share accounts for **% of the preferred forms of burial. The classic grave makes up only **% in **** and a classic urn burial preferred **% of respondents.
In response to the question "What form of burial would you want once regardless of all legal requirements?", **% of respondents said they would like a low-maintenance burial.
However, burials in Germany are still carried out in a very traditional way, partly due to quite rigid regulations. An article in the Tagesspiegel contrasts traditional German practices with the more extravagant practices of the French, Spanish, Swiss or English: the use of ...
2.3 Factors determining the market
Many factors can influence the funeral market in Germany, among the recurring factors we can maintain:
The number of deaths in Germany : the evolution of the number of deaths is the main determinant of the volume of activity of the funeral service in Germany.
The use of alternatives to traditional funerals : More and more the use of cremation is increasing, which was not considered before. The type of burial has a great influence on the mark since, depending on the type of burial, different costs and services are requested.
The role of insurance companies. since health insurance companies no longer pay death benefits since ****, relatives are also increasingly opting for cheaper solutions.[***]
3 Market structure
3.1 A market dominated by small structures
Legal form of funeral homes Germany, ****, number of institutes Source: ****
Breakdown of funeral homes by number of employees Germany, ****, % Source: ****
In ****, of the **** businesses, there was a majority of small funeral homes. **.*% of the funeral homes had less than ** employees and **.*% have less than ** employees. According to the same study, there was a majority of sole proprietorships: in ****, **.*% of all funeral homes were sole proprietorships.
Distribution of funeral homes by turnover Germany, ****, % Source: ****
The vast majority of businesses have a turnover of less than * million euros. **.*% have a turnover between ***,*** and ***,*** euros and just under **% have a turnover between ***,*** and ***,*** euros.
3.2 Geographical differences between the federal states
Source: ****
This map of Germany shows a range of prices for the services of funeral homes listed on the Bestattungen.de website by region. We have used the average price. It can be seen that the prices of services in Saxony-Anhalt are higher on average than in the rest of Germany. Conversely, Mecklenburg Vorpommern is the region with the lowest prices.
There are also regional differences in the type of burial: In the southwest, burial is preferred, while in the north and east cremation is more common, according to an article in the Tagesspiegel.
By type of burial, prices vary between regions and the services used. The comparison portal Bestattungsvergleich.de has determined the following price range:
Source: ****
4 Offer analysis
4.1 An increasingly diversified offering
The increase in the number of "discount" services
We are seeing more and more discount services being offered. In recent years, many discount funeral homes have entered the market.
For example, there are about **** funeral homes in North Rhine-Westphalia (***). According to the association, the "discount" funeral homes account for about **-**% of the national total, according to an article in the Rheinische Post .
The offer is extended to other practices
For a long time, Muslims had their dead buried in their countries of origin. In fact, according to Muslim custom, the deceased had to be wrapped in a shroud for burial. However, this practice was generally not permitted under German laws. In fact, in Germany, the practice of scarification applies to both burial and cremation in cemeteries.
Some cities, such as Hanover, had already made practical arrangements to allow burial of Muslims. But the country is becoming more open to these practices: More and more states are allowing burials according to the Islamic rite (***)
The number of funeral homes in Germany offering Islamic burials is on the rise.[***]
This trend is particularly true in large cities, where the proportion of the Muslim population is higher. Especially in Berlin, the number of ...
4.2 Variable costs depending on the selected service
An average funeral costs about *,*** euros. However, costs vary considerably depending on the region and type of funeral. The main cost items with the usual price ranges are listed below. Stiftung Warentest has classified prices according to the type of service.
direct services, which are traditionally considered by funeral homes indirect services, which have to do with the organization of funerals, and can be carried out by the funeral home cemetery fees, which are incurred when choosing a conventional burial.
Source: ****
Stiftung Warentest, a German consumer organization that conducts comparative tests of products and services on the market, has listed all the costs that can be charged to funeral services for a conventional burial in a cemetery. It should be noted that this is an estimate and that there are cheaper offers that do not include all these services.
4.3 A growing number of players
Number of funeral homes Germany, from **** to **** Source: ****
There are more and more companies offering funeral services. Since ****, the number of companies offering funeral services has increased by **% from *,*** to *,*** companies.
Although the number differs from the number of funeral homes mentioned in Chapter *.*, this may be due to different registrations and legal forms. Nevertheless, an increasing number is discernible.
4.4 An advantageous cost structure
Ratio of expenses to sales Germany, ****, % Source: ****
On average, the expenses represent **% of the turnover of a funeral home in ****. The most important expenses are generally the personnel costs in the amount of **.*% of the turnover.
5 Rules and regulations
5.1 A highly supervised activity
The funeral laws of the federal states regulate the obligation to bury the deceased, as well as issues relating to rest periods and cemetery obligations.Regulations such as the time of burial, the issuance of a death certificate and the determination of death by a physician and the performance of a post-mortem examination are specified in each state.
Funeral law is the responsibility of the states. Each state passes its own law. The website Bestattungen.de takes upthe burial laws of the individual federal states in detail.
For example, burial times (***) can vary from state to state. This period ranges from ** to ** hours, depending on the state .
Cross-border transfers are excluded from this period. Funerals, on the other hand, may take place no earlier than ** hours after death. Some states also set a deadline by which the burial must take place at the latest.
6 Positioning of the players
6.1 Segmentation
Online comparison company :
BESTATTUNGEN.DE
Actors at national level
Maple Inc
The players are very locally anchored, only very few companies are active on a national level
Association
Federal Association of German Undertakers
- BESTATTUNGEN.DE
- Ahorn AG
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