‘Upselling’ a worry in funeral business
New Zealanders may be paying too much for funerals, researchers say.
A University of Sydney Business School study of the industry found that Australian families were paying more than was necessary for funerals offered by providers who used predatory marketing practices to exploit vulnerable customers.
It found that while the average basic funeral in Australia cost about A$6000 (NZ$6389), all regulatory requirements related to the disposal of a body could be met for A$1200.
Professor Sandra van der Laan said costs were inflated by funeral directors who offered total packages rather than itemised quotes. She said one of the biggest players in the Australian market, Invocare, had an expanding presence in New Zealand. It has 19 funeral home brands and two memorial parks here.
‘‘Upselling is also common with funeral directors basically hinting that if you loved the departed, you should consider a more expensive coffin which might be marked up by a thousand per cent,’’ Van der Laan said. ‘‘Upselling also goes on in relation to flowers and a range of other things that you actually don’t need.
‘‘In the end, a lot of what you’re paying for is the funeral director’s fees and all they really do is organise to get the body from the hospital to the funeral service and then to the cemetery or the crematorium as well as ensuring all the paperwork is in order.’’
In New Zealand, the average funeral costs between $8000 and $10,000. Several funeral homes offer ‘‘direct cremation’’ options, where no service is held. These cost just under $2000.
An Invocare spokeswoman said the average professional services fee would about 40 per cent of the funeral’s total cost and would cover arranging and conducting the service, obtaining the necessary certificates, transferring the body and arranging mortuary care.
‘‘We are fully aware of the vulnerability of people when dealing with the loss of a loved one and we go to great lengths to ensure they have a complete understanding of what service they are to receive, whether it’s the most affordable option or a full-service funeral,’’ the spokeswoman said.
Katrina Shanks, chief executive of the Funeral Directors Association, agreed funerals could be as large or as small as mourners wanted.
She said the cost of burial was a concern. It should be possible to put on a simple funeral for $4000, without burial costs, she said. But in big cities, burial can cost $5000 or more.
A Law Commission report noted that in New Zealand, ‘‘few providers are willing to unbundle their services, and access to alternative forms of interment such as eco or natural burials is limited.
‘‘Although there is no legal requirement to engage a funeral director, have a body embalmed, or purchase a coffin, the reality is that very few cemeteries or crematoria deal directly with the families of the deceased.’’