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Dying In Times Of Crisis - The Rise Of Budget Burials

Article illustrative image Partner logo Homemade funerals

PARIS - The current economic crisis and the Internet might succeed in doing what the law has been unable to do in France for nearly 20 years: bring the cost of funerals down.

The burial market has faced major changes in the past 12 months. New expressions,  imported from the retail industry, are being used for the first time in the funeral business: "Low-cost funeral," "discount," "knockdown price." This was unthinkable just a few years ago.

A growing number of companies have broken into this new sector of the market. Websites now offer price comparisons to families no longer able to spend 3,000 to 3,500 euros on average to pay their last respects to a deceased relative.

It has now been nearly 20 years since France abolished the former monopoly of locally appointed funeral directors (Sueur Act – Jan. 1993) and unlocked the market. Yet prices did not fall. Instead, undertakers charged higher prices, making the same amount of money while working less. Why not? In this singular sector, customers do not complain much. At least until now.

Burial prices have increased by one-third in ten years, reported French consumer association UFC-Que Choisir on All Saints' Day, 2011. The association denounces the lack of transparency in a sector with an annual turnover of two billion euros.  "Funerals are painful events that take place when people are often more vulnerable than usual. Some undertakers take advantage of the situation."

Yet in the past few months, something has changed. Families can no longer keep up with the costs of burials. Michael Kawnik from the Independent Funeral Information Association (AFIF) says he has received a growing number of phone calls from unemployed people living on benefits, whose parents have passed away leaving empty bank accounts. "They are extremely anxious. If they can’t afford the funeral, what is going to happen? Potters' fields?"

Funeral credit on the installment plan

A growing number of undertakers say that it is increasingly difficult to be paid for their services. "We are struggling, even with fair prices," says Sandrine Thiéfine, the President of Roc-Eclerc, a pioneer franchise in the budget burial business, established in 1985. Customers now ask to pay in several installments. Unpaid bills and disputes are increasing. "We just signed a deal with French bank Société Générale to offer an interest-free funeral credit in three or five installments. We also inform our customers that if the deceased had complementary insurance coverage, the insurance company may cover part of the expenses. We then try to help people get their money back."

At Roc-Eclerc, the average cost of a burial is around 3,000 euros, and a cremation is 2,500 euros. The 2,500-euro bottom-of-the-range offer is on promotion at the moment. With 500 stores around France, the number of franchises has doubled in seven years. "Our competitors have finally realized that they were too expensive. About time! There have been so many abuses," the CEO says proudly. But Roc-Eclerc must now compete with new companies that all offer burial services for less than 2,000 euros.

Ecoplus funeral services (“Dying should no longer be a question of luxury”) is a new franchise launched by funeral company Le Choix, which has more than 700 dealers around the country. CEO Philippe Martineau says he had a revelation. “With the on-going crisis and everyone with less money, we have had to rethink our business model.” The company has six new stores in France's largest metropolitan areas. Three more are due to open by the end of this year, and the CEO hopes to launch 100 new stores within the next five years. According to Le Choix, quality remains high but the company offers fewer and simpler deals: 1,250, 1,990 or 2,490 euros. "The demand is strong. The situation is quite similar to what happened in the supermarket sector with the boom of supermarket brands," explains Philippe Martineau.

Parisian company Clair Obsèques, established in 2011, uses the same strategy and charges 1,180 euros for a burial. Founder Nicolas Ritter lost his mother at the age of 24. "My brothers, who were 16 and 22 at the time, and I got ripped off by funeral directors taking advantage of people who are completely distraught. Their profit margins are colossal. I decided to offer a more reasonable price, because I refuse to charge 5,000 euros for something I can sell for 1,180 euros.” Like Ecoplus, his two stores in Paris have websites.

Online and guilt-free

Aside from budget restrictions, the French mentality regarding death has evolved. More people search “funeral” on Google. Taboos are slowly fading away, as shown by the staggering growth in funeral insurance plans. Customers now discuss their own death with their bankers. The funeral business now benefits from the growing popularity of online browsing and shopping. "There are those who simply can’t and those who won’t spend as much," says Ecoplus' CEO. "They have a secular, consumer attitude. They are looking for simplicity.”

Rebillon, which usually offers traditional customized funerals, is now targeting this type of customer. The company launched a website in late 2011 to promote two simple funerals (1,091 euros or 1,250 euros), only in the Paris metropolitan area, that do not include religious services. A few months later, the funeral department of the Paris City Council followed, launching its own website, as well as offering a stunningly cheap "789-euro" funeral, which covers the legal requirements at a fixed rate; the total price is actually closer to 1,400 euros for a cremation and 1,800 for a burial.

François Michaud Nérard, head of Paris’ funeral services, had the idea when he noticed that a large number of 40- and 50-year-olds were planning funerals over the phone, by emails or letter, and "feel very mistrustful when dealing with private morticians. They want to be able to make their choice freely and not have to face someone who will make them feel guilty for not buying the most expensive coffin."

With the Internet, things have changed. For instance, people can now get an estimate without having to make a commitment.

The new funeral price comparison websites can provide four free estimates in an hour. Customized estimates are now mandatory and allow customers to distinguish between mandatory and extra fees. According to customer association UFC-Que Choisir, which surveyed 1000 funeral homes in June 2011, in 20% of the cases, funeral directors did not offer estimates, and the estimates they did offer were not always in conformity with the law.

The Internet is no paradise for customers. Price comparison websites resell their estimates to funeral directors for up to 50 euros apiece. But now that low-cost companies are booming, undertakers are more likely actually to offer the new 1,400 euros deals they all claim to have upon request.  

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