#Japan #Tokyo #funeral services #San Holdings #Kokoro Net

San Holdings and Kokoro Net's Merger Announcement

On October 23, 2025, San Holdings Inc., headquartered in Tokyo and Osaka, announced a strategic merger with Kokoro Net Inc., aiming to provide reliable and quality funeral services nationwide. This significant announcement highlights the changing landscape of the funeral industry and the growing need for trust and reliability among service providers.

Background of the Merger

The decision to merge stems from two main reasons: the evolving business environment and the increasing importance of being a trustworthy company. The funeral industry, particularly in Japan, has seen a surge of new entrants from diverse sectors, leading to significant changes. Factors such as price competition driven by small-scale funeral services, the accelerated establishment of funeral facilities across regions, and shifting customer perceptions of funerals are all reshaping the industry landscape.

Adapting to Changing Business Environment

The emergence of matching companies and the rise in small-scale funeral services have intensified price competition, making it crucial for established firms to adapt. The market also faces an increasing expectation for companies to act as reliable partners, particularly as the senior population's needs continue to grow.

A survey conducted by San Holdings in July revealed that a staggering 45.7% of respondents regretted not knowing the appropriate prices for funerals, highlighting the information asymmetry that exists between providers and consumers. In a sector that is not frequently accessed, adequate information is often lacking, leaving consumers to navigate uncertain waters when making critical life decisions.

Trust and Reliability in Services

The merger is designed not just to expand market presence, but also to enhance consumer trust and ensure high-quality service delivery. As the need for end-of-life services grows, particularly among seniors, it is imperative that companies provide comprehensive, seamless support that is both trustworthy and reliable.

The vision for San Holdings is clear: to broaden the scope of their services and reach as many families as possible. By 2031, they plan to establish 550 funeral homes across Japan, achieved not only through their own expansion efforts but also through mergers and acquisitions, like the current integration with Kokoro Net.

Benefits of the Merger

San Holdings and Kokoro Net both share fundamental values and missions that resonate deeply with their operational philosophy. Kokoro Net’s commitment to delivering satisfaction and tranquility aligns with San Holdings’ vision of being a supportive partner in life endings. This merger not only consolidates resources but also enhances service quality significantly.

Both companies, being publicly listed, ensure governance through compliant business practices, increasing consumer confidence in the combined entity's operations. By pooling their strengths, they aim to tackle industry challenges and set a precedent in the changing landscape of funeral services in Japan.

Moving Forward

The newly formed partnership will focus on three key synergy benefits:

1. Complementary Business Regions: The integration will enhance service coverage without overlapping existing operational areas, significantly boosting the number of funeral homes under San Holdings’ management.
2. Expanding Market Share through M&A: This merger signifies a proactive approach toward shaping the industry through strategic acquisitions and partnerships that will further solidify their market reach and service quality.
3. Addressing Industry Challenges: As the labor market contracts, leveraging technology and shared resources will become vital to maintain service excellence and operational efficiency.

Conclusion

With a solid foundation of values and a shared vision for the future, San Holdings and Kokoro Net are poised to transform the funeral industry landscape in Japan. Their merger is not merely a strategic move for growth but a commitment to elevating the standards of end-of-life services and addressing the evolving needs of Japanese families. As they embark on this new journey, the emphasis will undoubtedly remain on trust, quality, and comprehensive support for their clients during difficult times.