The Funeral Services and Related Activities Industry in South Africa 2022

Introduction

This report focuses on the funeral services industry in South Africa, which generates revenue of about R10bn per annum, and has been growing at around 12% annually.

Statistics show the average death rate from 2009 to 2019 was 9.5 deaths per 1,000 inhabitants. According to the South African Medical Research Council’s website, there were 704,823 deaths in 2021, and the National Population Register shows there were 493,602 deaths in 2020, 441,996 in 2019, and 443,490 in 2018. While the pandemic demonstrated that undertakers and funeral parlours play critical roles in society, it also highlighted the challenges facing small funeral services operators. Department of Health regulations require anyone handling the body of someone who died of COVID-19 to wear personal protective clothing. This resulted in extra financial costs for many small undertakers, who also do not have resources to stock up on coffins to cater for high demand. A challenge in the industry is the growing demand for burial space, which role players say needs to be addressed urgently. South Africa’s population is growing at about 1% per annum and data from the United Nations shows expected growth from just over 60 million in 2021, to between 65 and 67 million people by 2030.

Opportunities

Formalisation of the informal funeral services sector.

Green funerals and eco-cemeteries. The development of alternative methods of body disposal such as aquamation cremation.

Outlook

The funeral services industry is expected to continue growing due to population growth.

However, the increasing cost of living is expected to place further pressure on already financially-strained consumers, who may opt for lower cost funerals. MiWayLife, said that while the pandemic led to changes in how funerals are carried out, it has also introduced a new normal of fewer people attending, and cutting back the time and need for lengthy preparations, that could help grieving families cut back on costs and lengthy funeral preparation. Funeral parlours can benefit by offering live streaming funeral services, funeral pre-planning services, competitively priced packages, digital marketing, and investing in green burials. AVBOB general manager Pieter van der Westhuizen said “We must keep on investing in technology. The pandemic is a disruptor, and businesses that are only dependent on physical infrastructure and distribution channels will find it difficult to compete in the future.

I firmly believe that a hybrid of face-to-face selling and using technology is the future. ”Report Coverage

This report focuses on the funeral services industry and related services in South Africa.

It includes information on the effects of the pandemic on the industry, developments, notable players and key trends. There are profiles of 17 companies including major players such as AVBOB, Doves and Mosaic Funerals, burial societies such as Tshebedisano Burial Society And Calgro M3, which develops memorial parks.

Strengths

Demand is ongoing.

Growing industry. Strong demand at private memorial parks. There is a high level of black ownership.

Threats

Banks, retailers, and other service providers are selling funeral policies.

Increase in number of unregulated informal funeral service providers. Non-compliance with occupational health and safety hazards. The shortage of available burial land.

Weaknesses

Cost of funerals is increasing. Increasing unemployment resulting in fewer people being able to afford funeral policies. Informal market offers low cost funeral services, often without complying with regulations. Many workers have no formal training. Regulations are set by various national departments but implemented at local level. Shortage of burial space. Shortage of materials to make coffins and caskets.